In a ruling issued right this moment from Iowa, the courtroom enforced an appraisal award issued in favor of householders Gregory and Karen Larson, who suffered hailstorm harm to their property in March 2023. The case, Larson v. Auto-Homeowners Insurance coverage Firm, 1 gives an vital reminder that the appraisal course of and awards aren’t simply overcome primarily based on dissatisfaction with the end result.
The dispute arose when the Larsons and their insurer disagreed over the scope and valuation of the hail harm. A central level of rivalry concerned whether or not undamaged siding needs to be changed to keep up a fairly uniform look, a requirement beneath Iowa regulation. Pursuant to their coverage, the Larsons invoked the appraisal provision to find out the quantity of their loss. Every celebration chosen an appraiser, and the 2 appraisers agreed upon an umpire, Lee Shepherd, to resolve any disputes.
The appraisal proceeded in response to plan till the appraisers couldn’t attain an settlement, at which level the umpire took over. Shepherd carried out an unbiased inspection after each appraisers agreed to not be current and in the end issued an appraisal award within the quantity of $208,194.47. This determine matched the quantity proposed by the Larsons’ appraiser and exceeded the quantity listed within the Larsons’ authentic sworn proof of loss by over $80,000. The Larsons’ appraiser signed the award. Auto-Homeowners’ appraiser refused to signal, criticizing the umpire’s course of.
Auto-Homeowners responded by submitting a movement to put aside the umpire’s award, claiming mistake, bias, and misfeasance. The corporate contended that the umpire failed to carry discussions with both appraiser, didn’t facilitate deliberations, and primarily adopted the policyholders’ appraiser’s place wholesale. They argued that this lack of interplay and the truth that the award exceeded the proof of loss indicated that the method was not neutral or truthful. In response to Auto-Homeowners, the award needs to be vacated and the matter returned to courtroom.
The Larsons, represented by Merlin Regulation Group lawyer Jonathan Bukowski, opposed the movement and filed their very own movement to implement the award. They argued that the method complied with each the insurance coverage coverage and Iowa regulation. The coverage doesn’t require the umpire to deliberate with appraisers or maintain joint inspections, and Iowa courts have lengthy held that appraisers and umpires are chosen for his or her experience and permitted to succeed in their very own unbiased conclusions.
The Larsons identified that the umpire had acquired detailed estimates from each side, reviewed them, and made his personal web site inspection earlier than reaching a call. That the umpire’s conclusions mirrored these of the policyholders’ appraiser didn’t, of their view, point out bias, solely settlement on the details and needed scope of repairs. Moreover, the quantity within the proof of loss doesn’t prohibit the appraisal panel, whose perform is to ascertain the precise quantity of the lined loss.
The courtroom agreed with the Larsons. In its ruling, it reiterated the excessive threshold required beneath Iowa regulation to overturn an appraisal award. Iowa requires clear proof of fraud, mistake, or misfeasance. The courtroom discovered no such proof. Whereas acknowledging that the umpire’s course of was much less communicative than Auto-Homeowners would have appreciated, the courtroom emphasised that neither the coverage nor Iowa regulation required dialogue, consensus-building, or adherence to the proof of loss determine.
The umpire’s actions fell squarely throughout the procedural and authorized boundaries for a legitimate appraisal. The courtroom famous that personal resolutions of disputes, comparable to value determinations, are strongly favored for his or her velocity and cost-efficiency. Accordingly, the courtroom denied Auto-Homeowners’ movement, lifted the keep on the lawsuit, and enforced the appraisal award in full.
This choice highlights how courts will usually shield the finality and integrity of the appraisal course of. Dissatisfaction with the consequence just isn’t sufficient to undo an award, particularly when the difficult celebration can not display concrete wrongdoing. This case serves as a reminder to policyholders and insurers alike that appraisal choices, as soon as rendered beneath the agreed phrases, carry important weight and won’t be simply disturbed.
Thought For The Day
“I don’t all the time agree with what the Courtroom says or does, however I respect its function in our democracy.”
—Lyndon B. Johnson
1 Larson v. Auto-Homeowners Ins. Co., No. LACV053659 (Iowa Dist. Ct. June 4, 2025).
