On November 21, 2014, Governor Cuomo Signed
Bill Into Law Allowing Appraisals In New York To Determine "Scope Of
Loss". The details of the bill’s
final language will be released shortly
Appraisal in first-party property insurance claims is
meant to resolve disagreements over the amount of loss. Appraisal is a
contractual alternative dispute resolution process. But often the parties
dispute involves some disagreement over the scope of the covered damages
resulting from the loss. Insurance carriers often argue that disputes involving
the scope of damages caused by a loss should not go to appraisal. Well,
Governor Cuomo officially signed a bill into law on November 21, 2014, allowing
appraisals in New York to determine the "scope of loss."
In the Summer of 2014, the bill passed the
New York State Assembly and Senate but needed to be signed by Governor Cuomo.
That signing did occur on November 21st. It amends Insurance Law Section 3408
subsection (c) dealing with court ordered appraisals under fire insurance
policies. The bill makes it clear that “Scope of Loss” issues are subject to
appraisal.
This is an important law for consumers because it
provides legal support in New York for policyholders to take claims to
appraisal that insurance carriers previously would have tried to keep out of
appraisal. This will avoid costly litigation, and will result in claim payments
to policyholders sooner.
If you have a claim that you think could be eligible for
appraisal by this law and appraisal has been refused by the insurance carrier
then please speak with experienced representation about your options.
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New York Passes
Legislation Allowing Appraisal to Determine "Scope of Loss"
July 16, 2014
Good News for Consumers! A bill passed the New York
Legislature that will broaden the scope of appraisal and help consumers recover
without litigation.
On June 17, 2014,Bill A9346A unanimously passed the New
York State Assembly and then unanimously passed the New York State Senate as
S4756A, setting the stage to benefit insurance consumers for generations to
come.
The bill, which was originally introduced on April 16,
2014, has been ten years in the making and amends Insurance Law Section 3408
subsection (c) dealing with court ordered appraisals under fire insurance
policies. The bill makes it clear that “Scope of Loss” issues are subject to
appraisal. This is a big win for consumers because prior to the passage of this
bill insurers could deny a demand for appraisal on the basis that the issues
involved in the claim were not solely confined to disputes on valuation of the
loss, but included issues involving the scope or extent of the loss.
The new law will enable consumers to take claims to
appraisal that would previously have been barred. Claims that not only involve
ascertaining the value of the loss but also the scope and extent of damages
involved will be open to the appraisal process. This will avoid costly
litigation, and claims will be more likely to resolve sooner rather than later.
The bill still needs to be signed by Governor Cuomo, but it looks promising.
If you have a claim that you believe may require
appraisal or where appraisal has been denied, this bill may well be relevant to
your claim. If you are uncertain, it is always a good idea to consult
experienced claims counsel.