In Mass., Value-Based Disputes Can Go to Reference Instead of Litigation

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The two sides of a potential compromise don’t always agree.  This is often the case in property insurance settlements, where an agreement must be reached before the claim can be finalized and closed.

What happens when the two sides – the insured and the insurance carrier – simply can’t agree on the amount of a loss?

If you’re in Massachusetts, you enter a mediation process known as Reference.  If you are anywhere else in the U.S., you enter into a similar, but slightly different, process known as Appraisal.

At SMW, we have broad experience in both of these dispute resolution arenas.  Given that our headquarters is in Massachusetts, however, we have particular familiarity with Reference.  Let’s take a close look at this Mass.-specific solution to value-centered disputes.

Massachusetts lawmakers have codified Reference in General Law Chapter 175 Section 100 et seq, setting forth the definitions and relevant procedures.  

 Section 100. If a claim is presented under any policy of fire insurance issued on property or interests in the commonwealth in the standard form set forth in the preceding section, and if the parties fail to agree as to the amount of loss, the company shall, within ten days after receiving a written demand from the insured for the reference of the amount of loss to three referees as provided in such policy, submit in writing the names and addresses of three persons to the insured, who shall, within ten days after receiving such names, notify the company in writing of his choice of one of the said persons to act as one of said referees.

The insured shall submit in writing the names and addresses of three persons to the company, which shall, within ten days after receiving such names, notify the insured in writing of its choice of one of said persons to act as one of said referees.

If, at the expiration of ten days from the choice of the second referee, the two referees chosen as hereinbefore provided, shall not have agreed upon and selected a person to act as the third referee, then either of the said referees or parties may make written application on oath to the commissioner in such form as he may prescribe, for the appointment of the third referee and the commissioner shall, after such summary inquiry or hearing, if any, as he may deem expedient, appoint a person to serve as the third referee and shall notify such person and the parties in writing of such appointment

It’s important to recognize that you can only go to Reference to resolve value-based disputes – i.e., the extent of loss and the amount of damage under an insurance policy.  Reference is not the venue to address questions of liability or coverage.

Reference is useful because it offers a quick and cost-effective means of settling disagreements over the value of a claim.  So, instead of forcing the insured to undertake expensive and time-consuming litigation, the parties have the option of a more efficient way to resolve the dispute.


If you’ve had a fire, flood or other property loss resulting in an insurance claim, and need a public insurance adjuster in Massachusetts, New Hampshire, Rhode Island, New England or anywhere in the U.S. or Caribbean, call Swerling Milton Winnick. We are the oldest and largest public adjusting firm in New England, and our team of experts will give you personalized, 24/7 attention to successfully resolve your residential or business insurance claim.