Who ultimately decides the amount of loss under the appraisal condition?

The correct choice indicates that the determination of the amount of loss is made through a process involving an umpire and appraisals. In the appraisal process as defined in many insurance policies, when there is a dispute regarding the amount of the loss, each party (the insurer and the insured) typically selects an appraiser. These two appraisers then assess the damage and come to their own conclusions regarding the value of the loss. If the appraisers cannot agree on the amount, they will involve an impartial umpire to make the final decision.

This structure is designed to ensure that both parties have representation and that a neutral third party— the umpire— plays a crucial role in reaching a resolution. The emphasis is placed on collaboration through the appraisers and the umpire rather than a unilateral decision made solely by the policyholder or just the adjuster. This process helps maintain fairness and impartiality in loss evaluations, which is essential in insurance claims handling.