In Higgins v. State Farm Fire & Cas. Co., No. 22-C-198, 2022 U.S. Dist. LEXIS 117477 (E.D. Wis. July 5, 2022), the Court addressed the often disputed question of whether an appraisal provision in an insurance policy is limited to disputes over valuation or extends beyond valuation to causation and/or coverage. The underlying loss in the Higgins case involved a fire at a rental dwelling owned by the Plaintiff and insured by State Farm under a Rental Dwelling policy for, among other things, fire losses. Subsequent to being notified of the fire, State Farm investigated and provided the Plaintiff with its estimated cost of repair. Plaintiff disputed the estimate, including the repairs necessary, and also sought additional sums for debris removal and lost rent.

The insurance policy at issue in Higgins included an appraisal provision which provided: “If you and we fail to agree on the amount of loss, either one can demand that the amount of the loss be set by appraisal.” Pursuant to this provision, Plaintiff demanded that State Farm submit to an appraisal to resolve the parties' disagreements. State Farm responded by indicating that it would enter into appraisal over the areas where there were "pricing differences" but not areas where there were "scope differences." According to State Farm, there were a number of issues regarding the scope of repairs necessary to restore the dwelling to its pre-loss condition. Plaintiff disagreed with State Farm's position and did not seek to move forward with the appraisal process on only the items State Farm identified as appropriate for appraisal.