Most New Jersey property owners never read the appraisal paragraph until they need it. It’s short, but every sentence matters.
Where it comes from
New Jersey adopted a standard fire policy by statute. Its appraisal provision became the model for the appraisal clauses in homeowners, landlord and commercial forms sold in the state. Insurers can and do change the wording, so treat the description below as typical, not as your policy.
What a typical clause says, sentence by sentence
The quoted wording below follows common homeowners forms. Your policy may phrase it differently.
- “If you and we fail to agree on the amount of loss…” The trigger is a disagreement about money, not coverage.
- “…either may demand an appraisal.” You or the insurer can start it. The demand should be in writing.
- “Each party will choose a competent and disinterested appraiser within 20 days…” Your appraiser must be independent and named on time.
- “The two appraisers will choose an umpire. If they cannot agree within 15 days…” A judge can be asked to appoint one.
- “A decision agreed to by any two will set the amount of loss.” This is what makes the award binding.
- “Each party will pay its own appraiser and bear the other expenses equally.” The usual fee split.
What the panel can’t decide
Coverage, exclusions, late notice and bad-faith questions sit outside appraisal. A panel can value damage, but if the insurer says the damage isn’t covered at all, you may need an attorney.
Practical takeaways
- Calendar the 20-day window the day a demand is made, by either side.
- Choose an appraiser with no stake in the repair contract.
- Protect the suit-limitation date separately.