Insurance settlement too low? Here's how Tennessee homeowners force a fair number.

Why Tennessee settlements come in low

When a homeowner tells us the check felt wrong, the shortfall almost always traces to one of three mechanisms — and all three live in the paperwork, not the weather:

• Scope gaps. The estimate simply leaves work out: two slopes instead of four, an elevation of siding missing, no line for detach-and-reset of gutters or HVAC, no drip edge, no steep or high charges, trades like electrical or painting absent entirely. The estimate reads plausibly to a homeowner because everything listed is priced — the theft is in what is not listed.
• Depreciation games. The carrier writes a replacement-cost number, then depreciates its way down to an actual cash value payment. Over-aggressive age or condition factors shrink the check, and some estimates depreciate labor itself — a practice the Tennessee Supreme Court rejected under the policies at issue in Lammert v. Auto-Owners, 572 S.W.3d 170 (Tenn. 2019), reading the ambiguity in the policyholder's favor. You cannot audit what you cannot see, which is why the worksheet rule below matters.
• Unit pricing. The right items appear at the wrong prices or quantities: stale price lists, square footage measured short, a "repair" unit price applied to what is really a replacement. Line-item pricing disputes look small individually and compound into thousands.

Every one of these is checkable. The homeowner who gets paid fairly is the one who forces the estimate into the open and audits it line by line — or hires someone whose job that is.

The matching rule and the depreciation worksheet

Tennessee's claims-handling regulation gives you two tools most policyholders never hear about, both in TDCI Rule 0780-01-05-.10 (we cover the whole rule chapter in our Tennessee claim deadlines guide):

• Matching. When replaced items do not match what remains in quality, color, or size, the insurer must replace items so the result conforms to a reasonably uniform appearance — at no cost to you beyond betterment and your deductible. The patch-three-shingles offer on a discontinued roof, or the one-wall siding repair in a color that no longer exists, runs directly into this rule.
• The depreciation worksheet. The rule defines actual cash value as replacement cost less depreciation and requires the insurer to provide a depreciation worksheet on request. Request it, in writing, every time. It is the document that reveals over-depreciation and labor depreciation — the Lammert problem — and carriers know exactly what it exposes.

When you ask why the offer is what it is, Tennessee's unfair-claims-practices law sets the standard the Commissioner holds carriers to: Tenn. Code Ann. § 56-8-105 lists failing to promptly provide "a reasonable and accurate explanation" for an offer of compromise settlement among its prohibited acts. Ask for the explanation in writing. Either the answer holds up, or you now have its weakness on paper.

Appraisal: the lever that takes the number out of their hands

Nearly every Tennessee homeowners policy contains an appraisal clause: if you and the insurer disagree on the amount of loss, each side appoints an appraiser, the two appraisers select an umpire, and the panel — not the carrier's staff adjuster — sets the number. For an underpaid claim, this is the main event, because Tennessee law draws the boundary in a way that fits underpayment exactly.

Read those together and the shape of the fight becomes clear. In Merrimack Mutual Fire Insurance Co. v. Batts, 59 S.W.3d 142 (Tenn. Ct. App. 2001), the court held that the appraisers' authority is limited to determining the "amount of the loss" — they cannot decide coverage or liability. That boundary cuts in your favor on an underpaid claim: the carrier has already admitted coverage by paying something. What remains — how much, how big the scope, what a proper repair costs — is squarely appraisal territory, and the 2025 Nashville Communications decision confirms that repair-scope disputes over admitted damage belong to the panel. The repair-versus-replace fight, the missing slopes, the short quantities: that is the panel's job, not the desk adjuster's.

One Tennessee-specific caution from Batts: appraisal is not arbitration, and the panel's award does not resolve coverage questions the insurer preserved. If the carrier is disputing whether the damage is covered at all — not just its price — you are in denial territory, and the levers are different.

The fee math: why Tennessee's 25% tier exists for exactly this moment

Tennessee's public adjuster fee statute, Tenn. Code Ann. § 56-6-913, is built around when you sign:

• Hired before the insurer makes an offer: the fee is capped at 15% of the total settlement.
• Hired after the insurer's offer: the fee is capped at 25% of the increase — the difference between the carrier's last offer before the contract and the settlement the adjuster negotiates after it.
• No fee, retainer, or deposit of any kind may be taken before the claim settles, and no fee may be charged on advance payments made before the contract. (A special 10% cap applies to certain catastrophe total-loss claims, and the residential caps do not apply to commercial policies.)

Sit with what the 25% tier means for an underpaid claim. The offer you already have is untouchable — the fee attaches only to money a public adjuster adds on top of it. If the number does not move, contingency means the review cost you nothing. If it moves the way properly re-scoped claims move, you keep the original offer plus three-quarters of every added dollar. The legislature priced the decision so that a homeowner staring at a low offer has nothing to lose by putting a licensed professional on it. The full fee rules, with the statute quoted, are in our Tennessee public adjuster fee guide.

The 60-day demand: Tennessee's bad-faith backstop

When a carrier's lowball crosses from wrong into unreasonable, Tenn. Code Ann. § 56-7-105 supplies the backstop: after a formal demand by the policyholder, if the insurer refuses to pay the loss within 60 days, and a court or jury finds the refusal was not in good faith and inflicted additional expense, loss, or injury (including attorney fees), the insurer can be liable for up to 25% on top of the loss, measured by that additional harm.

Straight talk about who does what: the bad-faith case itself is a lawsuit — attorney work, not public adjuster work. What a public adjuster does is build the record the demand stands on: the documented scope the carrier ignored, the worksheet showing improper depreciation, the appraisal posture, the dated paper trail. We prepare claims as if the demand will be tested, and we refer litigation to policyholder attorneys when the carrier forces it. If your carrier is stalling rather than shorting — slow answers instead of low ones — the delay playbook is its own page: insurance claim delayed.

Underpaid is not denied — and the difference decides your playbook

An underpayment is a partial yes: coverage admitted, amount shorted. That is appraisal country, as above. An outright denial disputes coverage itself, and under Batts the appraisal panel cannot resolve it — that fight runs through the denial letter, the policy language, the Commissioner, and if necessary the courts. If that is where you are, start with our guide to a denied insurance claim in Tennessee instead. Many claims are both — one part denied, one part underpaid — and the two tracks run in parallel.

Questions Tennessee homeowners ask us

A low offer is a starting bid. Treat it like one. A free, confidential case review by a licensed Tennessee public adjuster takes three taps — and if we take the case after the insurer's offer, our fee by law comes only from the increase we win, never from the money already on the table.

See if my case qualifies 770-230-2616