A major insurance dispute now before the Eleventh Circuit may become a defining case on the limits of judicial review in property insurance appraisals. At issue is whether a court may set aside an appraisal award because of alleged flaws in how the panel reached its result, or whether those concerns fall outside the proper scope of post-award review.
The appeal stems from Hurricane Sally losses at the Portofino condominium property on Pensacola Beach. The appraisal process produced awards totaling roughly $187 million, but those awards were later vacated by a federal district court. The case now places a central question before the appellate court: when does judicial oversight protect the integrity of appraisal, and when does it improperly invade the province of the appraisal panel?
The case is now before the United States Court of Appeals for the Eleventh Circuit, 1 and the appellate briefs have now been filed. 2 For participants across the property insurance industry—including policyholder advocates, public adjusters, contractors, attorneys, appraisers, and insurer representatives—the outcome warrants close attention.
The dispute arose from Hurricane Sally and ultimately produced appraisal awards totaling approximately $187 million. The insurers challenged those awards, and the federal district court vacated them. Both sides now ask the appellate court to determine whether that ruling should stand.
This appeal is significant because it presents fundamental questions about the nature of appraisal. Florida courts have repeatedly recognized that appraisal is distinct from arbitration. Indeed, the Florida Supreme Court has expressly characterized appraisal as an informal process rather than a formal arbitration proceeding. There are no established rules of evidence, no required transcript, no presiding judge, and often no formal record of what transpired. The process depends heavily on the expertise, judgment, and professionalism of the appraisers and umpire selected by the parties.
I personally know all three members of the appraisal panel involved in this dispute. Each is a highly experienced professional with a substantial background in property loss valuation and appraisal work. That makes the case particularly noteworthy, because no credible argument can be made that the panel lacked the experience or familiarity necessary to address a complex property loss.
The insurers argue that the appraisal process failed because the policyholder’s appraiser allegedly admitted he never actually stated an “amount of loss” as required by the appraisal provision. According to the insurers, the appraiser presented a series of pricing scenarios and estimates that were never intended to be aggregated into a final repair figure. They contend that because the appraiser did not perform the core contractual duty assigned to him, the resulting awards were invalid. They further argue that the appraisal process was compromised by procedural irregularities, delayed document production, and questions regarding whether the appraiser was truly “disinterested” as required by the policy.
Portofino presents a markedly different position. The policyholder argues that the district court improperly converted disagreements over appraisal methodology into a basis for vacating an award. Portofino emphasizes that the appraisal panel spent years inspecting the property, hearing testimony, reviewing expert reports, considering competing estimates, and ultimately issuing written awards signed by at least two members of the panel. In Portofino’s view, whether one agrees with the valuation methodology or the final figures is not the controlling issue. The appraisal occurred, the disputes were presented, the differences were resolved by the umpire, and awards were issued. Portofino contends that the district court improperly looked behind the awards and, in effect, retried the appraisal process.
The insurers maintain that the case is not about whether the appraisal reached the correct result, but whether the appraisal process functioned in the manner required by the policy. Portofino responds that courts are not authorized to second-guess appraisers and should not reconstruct appraisal proceedings after the fact simply because one party is dissatisfied with the outcome.
In my view, appraisal has long occupied an unusual position within property insurance law. I have often described it as a process that can resemble a “kangaroo court.” That observation is not intended as a criticism of appraisers themselves. Rather, it reflects the reality that appraisal operates without many of the procedural safeguards present in litigation and formal arbitration. As a result, the process depends almost entirely on the integrity, expertise, and diligence of the individuals selected to serve.
When appraisers and umpires discharge their responsibilities professionally, appraisal can serve as an efficient and valuable mechanism for resolving disputes. When problems arise, however, courts are often left to determine what occurred without the benefit of a formal record. That is precisely why this appeal matters.
The Eleventh Circuit will be asked to determine how far courts may go in reviewing an appraisal award before they intrude upon matters traditionally reserved for appraisers. The court also will have to decide whether alleged failures in the appraisal process itself can justify vacating awards that otherwise appear final on their face. The decision may materially influence how future appraisals are conducted and challenged throughout Florida and potentially in other jurisdictions.
Anyone involved in property insurance appraisals should follow this case closely. It may become one of the most influential appraisal decisions in recent years because it addresses the very foundation of what appraisal is, what it is intended to accomplish, and the extent of judicial oversight that should exist once the process is complete.
1 Westchester Surplus Lines Ins. Co. v. Portofino Master Homeowners Assoc., No. 25-13710 (11th Cir. 2025).
2 Id., see, Portofino’s Opening Brief, and Westchester’s Response Brief.
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