Steve Badger and I shall be debating and discussing insurance coverage appraisal points on the sold-out IAUA occasion in Dallas tomorrow. So, it appears acceptable that I comply with up on the reply to a weblog submit I wrote, Guess What the Court docket Will Do with the Appointment of an Umpire. This was a case the place the events requested the court docket to nominate the appraisal umpire after the events reached an deadlock. That submit highlighted a rising judicial willingness to make sure the appraisal course of doesn’t stall due to gamesmanship or impasse.
In Bosak v. West Bend Mutual Insurance coverage Firmthe court docket granted a movement for the appointment of an neutral umpire. What is exclusive is that it directed the events to hunt that appointment by the American Arbitration Affiliation (AAA). 1
Most individuals within the property insurance coverage world perceive the standard appraisal course of. Both sides selects a reliable and neutral appraiser, and people two appraisers try and agree on an umpire. If they can’t, a court docket steps in and appoints one. That’s the textbook model. However when a court docket orders the events to go to the American Arbitration Affiliation, the method shifts from casual negotiation to a structured, quasi-administrative choice system.
The events, armed with the court docket’s order, provoke a request with the AAA for what is actually an administrative appointment. This isn’t a full arbitration continuing. The AAA is just not there to determine the dispute. Its position is narrower. It acts as a impartial clearinghouse to determine and appoint a professional umpire.
As soon as the request is opened, the AAA assigns a case administrator and compiles an inventory of potential candidates. These should not random names. They’re people throughout the AAA’s panel system, usually vetted for expertise, neutrality, and subject-matter experience. The AAA sends the record to each events, who’re given the chance to strike unacceptable candidates and rank the remaining ones so as of choice. That is the place technique issues. It isn’t merely about eliminating the worst choice. It’s about anticipating what the opposite aspect will do and shaping the pool of viable candidates that survive mutual evaluation.
After either side submit their rankings, the AAA applies its choice methodology and appoints the umpire. In most situations, it selects the highest-ranked mutually acceptable candidate. If the events handle to strike everybody, the AAA can concern a brand new record or make a direct appointment.
What’s placing about this course of is that many individuals assume “AAA guidelines” govern the appraisal. That’s not true. Except the insurance coverage coverage explicitly incorporates AAA arbitration guidelines, the AAA is usually appearing solely as an appointing authority. Nonetheless, the affect of the AAA’s construction shouldn’t be underestimated. The group requires disclosures from candidates, screens for conflicts, and brings a degree of procedural self-discipline that’s typically absent when appraisers attempt to choose an umpire on their very own. In contentious instances, that neutrality could be precisely what the court docket is searching for.
The underside line is that when a court docket sends you to the AAA for an umpire, you’re not in an off-the-cuff negotiation. You’re in a structured choice course of by which preparation, judgment, and technique will decide who in the end serves because the umpire.
Thought For The Day
“In issues of fact and justice, there isn’t a distinction between giant and small issues, for points in regards to the remedy of persons are all the identical.”
— Albert Einstein
1 Bosak v. West Bend Mutual Ins. Co.No. 25-cv-2030 (E.D. Wis. Mar. 17, 2026).
