Arbitration, Mediation, Appraisal
ALTERNATIVE DISPUTE RESOLUTION
California Insurance Code 2071 APPRAISALS
All insurance policies issued in California that provide fire insurance coverage must, at a minimum, include an "Appraisal" provision to provide a means of resolution of dispute. An insurer cannot change the language required under the Insurance Code in an attempt to limit the rights and protections provided to an insured. An insurer can modify the mandatory language to expand the protections. They may add an "arbitration" clause, for example.
Insurance Code section 2071, under the heading "Appraisal," states that:
In case the insured and this company shall fail to agree as to the actual cash value or the amount of loss, then, on the written demand of either, each shall select a competent and disinterested appraiser and notify the other of the appraiser selected within 20 days of such demand. The appraisers shall first select a competent and disinterested umpire; and failing for 15 days to agree upon such umpire, then, on request of the insured or this company, such umpire shall be selected by a judge of a court of record in the state in which the property covered is located. The appraisers shall then appraise the loss, stating separately actual cash value and loss to each item; and, failing to agree, shall submit their differences, only, to the umpire. An award in writing, so itemized, of any two when filed with this company shall determine the amount of actual cash value and loss. Each appraiser shall be paid by the party selecting him, and the expenses of the appraisal and umpire shall be paid by the parties equally.
This method of resolution may be used to resolve first party insurance disputes of value of the loss. Disputes concerning issues other than value, such as the meaning of policy provisions, are not subject to the appraisal process. Eaton & Johnson, Inc. is experienced in the appraisal process. We are available as appraiser as well as umpire. Please contact us for further information on how we may help you with this method of dispute resolution.
MEDIATION
Mediation is a process under which the parties submit their dispute to an impartial person--the mediator. The mediator may suggest ways of resolving the dispute, but may not impose a settlement on the parties.
Eaton & Johnson, Inc. is experienced in the mediation process. Please contact us for further information on how we may help you with this method of dispute resolution.
ARBITRATION
Arbitration is the referral of a dispute to one or more impartial persons for final and binding determination. It is private and informal, and intended to provide efficient and economical settlements. Insurance policies may contain specific provisions in an arbitration clause, so please be certain to look for the particular clause of the involved policy. An arbitration clause is not required to be included in all insurance policies. (see "Appraisal") Provisions may include issues subject to arbitration, evidence, locale, number of arbitrators, and so forth. Anything to which the arbitration provision applies, first party issues, third party issues, and/or the application of policy language and provisions, for example, may be resolved by arbitration.
Title 9 of the Code of Civil Procedure Section 1280 provides:
(e) "Party to the arbitration" means a party to the arbitration agreement:
(1) Who seeks to arbitrate a controversy pursuant to the agreement;
(2) Against whom such arbitration is sought pursuant to the agreement; or
(3) Who is made a party to such arbitration by order of the neutral arbitrator upon such party's application, upon the application of any other party to the arbitration or upon the neutral arbitrator's own determination.
Eaton & Johnson, Inc. is experienced in the arbitration process. Please contact us for further information on how we may help you with this method of dispute resolution.