How the Appraisal Process Works—and When It’s Misused in Insurance Claims
Its Purpose, Triggers, and Common Misuse
The insurance appraisal process was designed to resolve disputes about the value of a loss—not arguments about what’s covered.
It helps settle how much a repair or replacement should cost, once both parties agree on what needs fixing.
It’s supposed to be simple and efficient.
But in today’s claims world, it’s often misunderstood—and misused.
What Is the Appraisal Process?
Appraisal is a formal method for settling the cost of damage when an insurer and policyholder disagree—but only after they agree on what needs to be done.
This agreement is known as the scope of work.
If the two sides don’t agree on scope, they shouldn’t be using appraisal at all.
That’s a different kind of dispute—one that may need court, arbitration, or legal negotiation.
What Triggers Appraisal in Ontario?
In Ontario, your right to appraisal is triggered after you file a Proof of Loss.
This document tells the insurer:
- What happened.
- What you’re claiming.
- What you believe the policy covers.
Once you file it, if the insurer agrees on what was damaged but disagrees on the cost, you can use the appraisal process.
But again—there must be agreement on scope before appraisal starts.
No scope agreement? No appraisal.
How the Appraisal Process Should Work
Here’s the step-by-step process when done correctly:
- Both parties agree on the scope of repairs.
- The policyholder files a Proof of Loss with a specific valuation.
- The insurer disagrees on the value, but still agrees on the scope.
- Each side appoints their own independent appraiser.
- If the appraisers disagree, they select a neutral umpire.
- The umpire picks the most accurate valuation.
In this process, both sides are using the same blueprint—just pricing it differently.
This allows the decision to be fast, fair, and final.
Common Misuse of the Appraisal Process
Here’s the problem.
Some insurance companies force appraisal too early, even when no scope has been agreed upon.
This is a misuse of the process.
Why?
Because now the policyholder is being dragged into a fight over price without even agreeing on what needs fixing.
That’s not appraisal.
That’s a strategy to delay, deny, or confuse.
A Smarter Alternative: Dual Scope Pricing
When there’s no agreement on scope, here’s a better approach:
- Each side creates its own scope of work.
- Then each side prices both their own scope and the other side’s scope.
This means that if the matter goes to court:
- The judge only needs to decide which scope is valid.
- The pricing is already done.
- It avoids delays.
- And it saves money.
This method protects policyholders from being dragged into unfair or premature appraisals.
It also prepares both sides for fast resolution if legal action becomes necessary.
What High-Value Policyholders Should Watch For
If you’re a business owner or luxury homeowner, the stakes are high.
Getting pushed into appraisal without clear scope could cost you hundreds of thousands of dollars.
Insurers may:
- Rush the process to lock in low estimates.
- Avoid proper discussion of what needs fixing.
- Try to present appraisal as the only option.
Don’t fall for it.
Here’s what you should always do:
✅ Get the scope agreed to in writing.
✅ Never agree to appraisal if the insurer won’t confirm scope.
✅ Consult a public adjuster or legal expert if you’re feeling pressured.
✅ Remember: Appraisal is about price—not policy coverage.
Why Anderson Bettencourt Protects Clients from Appraisal Abuse
At Anderson Bettencourt, we’ve seen appraisal used as a tool to pressure and wear down clients.
We’ve taken over claims where the process was abused to reduce payouts.
And we’ve helped clients fight back with legally sound strategies—including dual-scope pricing and proper documentation.
Our team knows how to:
- Push back when appraisal is misused.
- Align your claim with legal precedent.
Maximize your final payout.
Final Thoughts
Used correctly, the appraisal process is a helpful tool.
Used incorrectly, it’s a trap.
Make sure you understand your rights, get expert help, and never agree to price negotiations without agreeing on what’s being priced.
If your insurer is pushing for an appraisal without clarity, it’s time to bring in professionals who understand the system—and how to use it to your advantage.
Anderson Bettencourt is here to protect your interests, your rights, and your settlement.