Glossary

What something was worth at the moment it was lost, rather than what it costs to buy a new one. It is generally replacement cost less depreciation, and how that depreciation is worked out is set by the policy and by the law of the state.

Disputing a vehicle valuation

A provision most auto policies carry for settling a disagreement about the amount of a loss, using an appraiser appointed by each side and an umpire if the two cannot agree. It reaches the amount only. A disagreement about whether the loss is covered at all is a different argument and the clause does not touch it.

The appraisal demand template

The argument that a repair has left you better off than you were before the loss, and that you should pay the difference. It comes up where part of something old is replaced with something new, such as one slope of a roof or a single component in an aging system.

A one-page summary issued by a contractor's insurer showing what cover was in force and for what period. It is evidence that a policy existed. It is not the policy, it does not make you a party to it, and it can be out of date by the time you are shown it.

A written variation to a signed contract: a change to the work, to the price, to the schedule, or to all three. Work done on a verbal change and billed later is one of the commonest shapes a construction dispute takes.

The drop in a vehicle's market value caused by its having been in an accident at all, separate from how well it was repaired. It is a claim about a car you still own, and it is usually made against the at-fault driver's insurer rather than your own.

The diminished value demand

A document in which somebody who could file a mechanic's lien gives up that right, normally in exchange for payment. They come in conditional and unconditional forms, and in partial and final ones. An unconditional waiver signed before the payment has actually cleared gives up the right without securing the money.

A warranty on the product itself, given by whoever made it. It generally covers the material failing and not the labor to put it right, and not a fault in how it was installed. That second half is a workmanship warranty and it comes from a different party.

A claim a contractor, subcontractor or supplier can register against the property they worked on when they have not been paid. It attaches to the property rather than to whoever owes the money, which is why an owner who has paid their contractor in full can still face a lien from a subcontractor that contractor did not pay.

The list of small outstanding items agreed near the end of a job and finished before final payment. A punch list records work that is known about and accepted as remaining. It is not a record of defective work, and treating one as the other loses the distinction that matters later.

A state-run fund, paid for out of contractor licensing fees, that compensates consumers who hold a judgment against a licensed contractor and cannot collect it. Not every state runs one. The ones that do cap what they pay and set conditions on who qualifies.

The written description of what a contractor agreed to do. When a dispute is about whether something was included in the price, this is the document that decides it, which is why a vague one is expensive long before anything goes wrong.

The point at which work is finished enough for the property to be used for its intended purpose, even though items remain outstanding. Contracts commonly hang things on it: when final payment falls due, when a warranty period starts, and when the risk passes.

A guarantee a contractor buys from a surety company, which pays a limited amount to somebody the contractor has wronged. It is not insurance for you, the amount is usually far smaller than people expect, and claims are generally paid in the order they arrive until the bond is exhausted.

Claiming against a surety bond

A warranty on how the work was done, given by the contractor rather than by the manufacturer. It is the one that answers a correctly made product installed badly. Because it comes from the contractor, it is worth what the contractor is worth, and it ends when the company does.