How Long Does an Umpire in an Insurance Appraisal Have to Make a Decision?
Does an umpire in an insurance appraisal have a deadline to get work completed and move the matter along to an award? I have been asked this question twice in two days, so a blog post seems appropriate.
The unfortunate answer is “no.” Unless the policy sets timelines, there are no deadlines for how long appraisers or umpires have to complete their duties.
As a warning to umpires who are certified, you may lose your certification by not diligently finishing your work and moving your appraisals along to an award. The three certifying entities for umpires have “diligence” as an ethical guideline.
The Windstorm Insurance Network Certification states this ethical requirement:
11. Be responsible to proceed diligently to conclude the appraisal proceedings.
The Insurance Appraisal and Umpire Association (IAUA) states this as an umpire’s ethical obligation:
IX. Appraisers and Umpires, upon undertaking an Appraisal, shall act with dispatch and due diligence in achieving a proper disposition of the Appraisal.
The Property Loss Appraisal Network (P.L.A.N.) has the following ethical requirement for umpires:
13. P.L.A.N. Certified Property Loss Umpires (CPLU) shall act in a manner of expedience, due diligence, and fairness in the performance of their duties in the appraisal process.
While all court cases write about the appraisal process as being fast and less expensive than litigation, this is merely an assumption with no data. There are no uniform time periods mandating when the appraisal process must be completed. The appraisal process can vary significantly in duration, potentially taking months or even years. This is because after the appraisers are selected and the umpire is appointed, the appraisers must investigate the claim, determine the amount of loss, and submit their findings. If they disagree on the amount of loss, their different valuations are submitted to the umpire for the final determination. This process can be time-consuming, and there are no specific restrictions on how long it can take. Then, unlike insurance arbitration, the parties in many jurisdictions – with Texas being the best example – can then fight over coverage issues and causation long after the appraisal is concluded.
If an umpire does not complete the appraisal diligently, the hypothetical consequences can vary depending on the specifics of the insurance policy and the jurisdiction. The failure of an umpire to complete duties in a timely manner could potentially be seen as a breach of an implied obligation, subjecting the umpire to possible suit. A party may name the umpire in a suit, requesting a court to intervene and set deadlines. This could potentially lead to the appointment of a new umpire or other measures to move the appraisal process forward.
If an umpire fails to complete their duties timely, it could potentially lead to disputes and delays in the resolution of the insurance claim. This could result in additional costs and complications for all parties involved.
Can the umpire be held accountable? I suggest all umpires read “Does an Umpire Have Immunity From Suit? Is an Appraisal an Arbitration in North Carolina?” and “Should Appraisers and Umpires Be Immune From Suit?”
The specific consequences for an umpire who refuses to move a matter along can vary depending on the insurance policy terms and the jurisdiction’s laws. The vast majority of umpires move their appraisals along, and delays are often attributable to the other appraisers or parties to the appraisal.
Insurance defense attorney Matthew Monson has advocated for the regulation of insurance appraisals. I would be curious if he would set a standard deadline for the appraisal process to be completed. It is not unusual for appraisals greater than one million dollars to take more than a year.
Delayed justice is justice denied, and I am in favor of trying to make insurance litigation and appraisal move along a lot faster than it currently does. Umpires—start your engines and move appraisals to the finish line!
Thought For The Day
I am the least worthy to preach to anybody. With that, I would like to remind everybody that in Matthew 5:25, the phrase “agree with thine adversary quickly” is part of Jesus’ teachings in the Sermon on the Mount. It emphasizes the importance of resolving disputes promptly to avoid the consequences of legal action and, by extension, spiritual judgment.
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