What is the recommended next step for parties in disagreement over a claim amount, when both have been unable to agree?

The correct step when parties are in disagreement over a claim amount and unable to reach an agreement is mediation. This process involves the parties working collaboratively with a neutral third party known as a mediator, who facilitates discussions and negotiations. The goal during mediation is to reach a voluntary settlement that is acceptable to both sides without resorting to formal proceedings.

Mediation is often favored because it is generally less adversarial and more cost-effective compared to litigation or arbitration. It allows for creative solutions that may not be available in a court judgment, enabling both parties to maintain control over the outcome of the situation.

Other options, while they may also address disputes, entail different processes and implications. For instance, litigation involves going to court, which can be time-consuming and expensive. Appraisal is typically used specifically in property insurance disputes where the focus is on the valuation of damages, and arbitration is a process similar to litigation but usually resolved by a private entity rather than a court. Each of these alternatives lacks the collaborative approach that mediation provides, making mediation the best next step in this scenario.