Colorado Appraisal Clause Guide
Most Colorado homeowner and commercial property policies contain an appraisal clause — a contractual mechanism that lets you and your insurer each hire an independent appraiser when you disagree on the value of a covered loss. If those two appraisers can't agree, they jointly select a neutral umpire whose decision on disputed items is binding. Colorado law, specifically HB18-1153, strengthened policyholder protections by requiring insurers to participate in the appraisal process when invoked. If you are ready to start, see our step-by-step guide to invoking appraisal and our insurance appraisal process guide. You can also browse all guides or review the frequently asked questions for related appraisal topics.
When Can You Invoke It?
You can demand appraisal any time you and your insurer disagree on the amount of the loss — not on whether coverage applies. Typical triggers in Colorado:
- The insurer's estimate is lower than contractor quotes you've received
- The insurer denies line items you believe are covered (scope disputes)
- The insurer's adjuster and your contractor can't agree on unit costs
- Hail damage on the Front Range — one of the most common Colorado triggers
Colorado is one of the most hail-prone states in the country. Front Range cities from Fort Collins to Colorado Springs regularly experience severe hail, making hail damage insurance claim disputes a frequent driver of appraisal invocations.
How the Process Works
- Demand appraisal in writing. Review your policy for the specific language — typically found in the "Conditions" section. Send written demand to the insurer's claims address.
- Each party selects a competent, independent appraiser. Colorado does not require a state license for insurance appraisers, so vetting credentials, experience, and independence is entirely on you.
- The two appraisers attempt to agree. They inspect the property, review documentation, and try to reach a joint award.
- If they disagree, they select an umpire. The umpire reviews the two appraisers' positions and issues a written award on disputed items. Agreement of any two of the three (both appraisers, or one appraiser + umpire) is binding.
- The insurer pays the award. Under HB18-1153, insurers cannot refuse to participate in appraisal once it is properly invoked.
No State Licensing — Why It Matters
Unlike Texas or Florida, Colorado does not regulate or license insurance appraisers or umpires through a state agency. There is no Colorado Division of Insurance registry for these professionals. This means there is no government database to verify against — you must rely on professional credentials (such as IAUA certification), industry reputation, and verifiable work history. For guidance on what to evaluate, see our Colorado guide to choosing an insurance appraiser. For more on the Colorado appraisal landscape, see our Colorado insurance appraisal process page.