The insurance company can “reserve the right” to deny coverage, even if appraisal results in a large, favorable number for you. We’ve seen this often: when the insurance company doesn’t like the number, it will continue to deny the claim. Meanwhile, you’ve lost months with nothing to show for it.
An insurer may ask you to sign a release in exchange for it making the appraisal award payment. You should never be asked to sign a release, whether before or after an appraisal. It is improper for an insurer to condition payment of an appraisal award on you signing a release or anything other than a proof of loss form.
The insurance company almost certainly has a lawyer working behind the scenes to guide the process. In some circumstances, these attorneys are working secretly to guide the appraisal toward a reduction or denial of payment.