Two different tools
When a property claim stalls, Illinois policyholders sometimes hear about two very different remedies in the same breath: appraisal and Section 155. They solve different problems, are decided by different people and follow different rules.
What Section 155 is, in general
Section 155 of the Illinois Insurance Code (215 ILCS 5/155) allows a court, in a lawsuit over a policy, to award reasonable attorney fees and an additional limited amount when it finds the insurer’s delay in settling or refusal to pay was vexatious and unreasonable. It’s often described as Illinois’ statutory bad-faith remedy. Courts look at the whole picture, and an insurer that has a genuine, reasonable dispute about coverage or value isn’t automatically liable under the statute.
What appraisal is
Appraisal is a contractual process in your policy for deciding the amount of a covered loss. It’s handled by two appraisers and an umpire, not a judge. It doesn’t decide whether the insurer acted reasonably and doesn’t award attorney fees or statutory amounts.
How they can interact
- An appraisal award may establish the amount of loss, which can matter in later discussions or litigation about payment.
- Invoking appraisal doesn’t waive other rights by itself, but every policy and case is different.
- Delay before or after appraisal is a separate question from the value the panel decides.
Practical takeaways
- Keep a dated log of every communication with the insurer.
- Respond promptly to reasonable requests for documents or inspections.
- Calendar your policy’s suit-limitation date and any proof-of-loss deadlines.
- If you believe the insurer is acting unreasonably, consult an attorney. You can also file a complaint with the Illinois Department of Insurance.
Our job is valuation. If your file raises legal questions, we’ll say so and suggest you speak with counsel.