Washington’s federal courts continue to enforce appraisal as a dispute-resolution mechanism the insurer must honor. The recent decision in Cory v. USAA General Indemnity Company 1 is a textbook example. The Corys suffered a substantial loss, submitted a supplemental estimate exceeding USAA’s payments by hundreds of thousands of dollars, and invoked the appraisal clause to resolve what they viewed as a straightforward disagreement over the amount of loss.
USAA twice refused to participate in the appraisal, which forced the homeowners into litigation. Once the issue reached a judge, the court took a careful look at the arguments on both sides and concluded that appraisal was not only appropriate but required.
The homeowners’ position in their briefing was rooted in the plain text of the policy and Washington law. They pointed out that the appraisal clause is unambiguous: if the parties fail to agree on the amount of loss, either side may demand an appraisal. They emphasized that Washington courts have repeatedly upheld appraisal as an efficient, expert-driven process meant to address valuation disputes, not coverage questions. They noted that appraisal does not deprive the court of authority. Instead, it simply narrows the issues by resolving the factual question of how much the loss is worth. They further highlighted that USAA had not provided meaningful estimates to justify its lower payments and had offered no legally grounded reason for rejecting their invocation of appraisal.
USAA attempted to recast the dispute as something beyond valuation. In its response, the insurer argued that the disagreement did not center solely on the cost to repair or replace the property but involved issues the appraisal panel was not authorized to decide, such as neglect, faulty workmanship by the insureds’ vendors, and whether certain ordinance-and-law costs were actually incurred. USAA also argued that additional living expenses were not subject to appraisal at all and that the personal property dispute turned not on value but on whether items were damaged by covered causes or by post-loss handling. In essence, USAA urged the court to conclude that appraisal would be “useless” because the real fight was about coverage, conditions, and causation rather than the dollars and cents of repair costs.
Judge Evanson was not persuaded. The court acknowledged that appraisal cannot decide coverage questions, but it emphasized the equally important principle that the existence of coverage issues does not eliminate a genuine valuation dispute. USAA, the court noted, had failed to provide authority for the idea that appraisal is proper only if it resolves all outstanding disagreements between the parties. Washington law does not support such a narrow interpretation. The court observed that a significant gap remained between the parties’ valuations, and nothing USAA raised demonstrated that appraisal would serve no useful purpose. Determining the amount of loss, the court reasoned, is not only authorized but beneficial, as it lays the foundation for whatever coverage disputes may follow and streamlines the path toward ultimate resolution.
The result is a reaffirmation of the appraisal process as a meaningful, enforceable contractual tool. When insurers attempt to avoid appraisal by dressing valuation disputes in coverage clothing, courts may see through it. They look to the policy language, the purpose of appraisal, and the long line of Washington precedent favoring its use. Judge Evanson’s ruling refused to let an insurer sidestep a mechanism designed to promote fairness and efficiency over arguments that policy language is still in play.
For policyholders, claims professionals, and public insurance adjusters, this decision shows the importance of recognizing when appraisal is appropriate and insisting on its enforcement when insurers resist. Appraisal cannot answer every question in a claim, but it can answer a pivotal one: “What is the amount of loss?” And once that question is resolved by experts, the court can turn to the remaining legal issues with a clearer, more reliable factual record.
Thought For The Day
“A promise made is a debt unpaid.”
— Robert Service
1 Cory v. USAA General Indemnity Co., No. C25-5452, 2025 WL 2581862 (W.D. Wash. Aug. 12, 2025).
