An appraisal is not a legal document, but usually the core negotiating tool in legal proceedings and court cases. A well-supported written appraisal by an appraiser with the appropriate experience is critical for success in estate, divorce, bankruptcy and insurance settlements.
Is an Appraisal a Guarantee?
An appraisal is not a guarantee. But they are important because if your jewelry is ever lost, stolen or damaged, your insurance company will refer to the appraisal document to settle the claim. There are a number of reasons why you should get your jewelry appraised, but peace of mind is at the top of the list.
1. Establishes replacement value for your insurance company.
2. Establish current market value for estate purposes.
3. Determine true value and authenticity of jewelry offered for purchase.
4. A written statement, independently, impartially and objectively prepared by a qualified professional independent jewelry appraiser, setting forth an opinion of the defined value of an adequately described piece of jewelry as of a specific date, supported by the presentation and analysis of relative jewelry market information.
The consumer needs to understand that “an appraisal does not change the value of the property”. Property is what it is, and the best insurance appraisal is an appraisal with an accurate, detailed description and a realistic assessment of the appropriate amount of insurance coverage needed.
What is the difference between a laboratory report and an appraisal?
A laboratory report is used entirely for identification and grading of a particular gemstone or diamond. This type of report is for grading and identifying purposes only. An appraisal evaluates the gemstone or diamond and determines the value in the appropriate market. The two are often used together as the appraisal uses the report to translate the quality into a value.
When will I receive my appraisal?
Same day to a couple of days in most cases. Estates and multiple items may take longer as they require more research.
How long does the appraisal take?
Most engagement rings take approximately 1 hour whereas multiple piece appraisals can take hours, days or weeks depending on volume and purpose.
What are the key roles of a professional appraiser?
The most important role of an appraiser is to offer an expert opinion as to the existence or non-existence of a precious object and to assess and grade the attributes and condition (prior to an acquisition or loss)
To ascertain market conditions and variations in value
The conclusion should reflect a modal value regardless of highs and lows that miss the normal tendencies. Highest and best use is a professional standard.
The value conclusion is best supported when the appraisal states the purpose and defines the market level. Stating the definition of value, the intended buyer and seller and the conditions of a sale each contribute to framing the argument and depicting the most relevant value.
How often do I need to update my appraisal?
Once you obtain a professional appraisal, only your insurance company or bank will ever require an update. The most common reasons are: a change of address, or an accelerated inflation cycle. All the data of your past appraisal is securely stored to make the reappraisal process quick & cost effective.
Can you come to our Place of Residence or Bank (vault) to do the appraisal?
Our fully equipped in house laboratory has everything required to quickly and correctly analyze your item.
Mobile Laboratory for Off Site Analysis
With a slimmed down version of our in-office laboratory we can travel to your home, office or bank vault and offer the convenience of off-site analysis. Travel fees will be assessed depending on location and cost of travel.
Appraisal Reports Include
- Gemstone identification & grading – weights and measures are calculated
- Treatment identification and quantification whenever possible
- Precious metal content
- Jewelry, pearls, gemstones etc. are all described in detail
- Photos taken from all directions
- Photomicrographs are taken if appropriate
- Researched valuation at the appropriate market levels
- Identification of designer or manufacturer, and circa dating whenever possible
- Value conclusion, intended purpose, grading methodology, definitions, limiting conditions & assumptions
- Copies of all existing certificates (GIA, EGL, AGS, etc.)
- Certification and Seal
Insurance policies come in many varieties, and only an insurance agent can give you advice in this area. A good place to begin is in understanding the difference between unscheduled and scheduled property. The basic homeowner's policy has some blanket coverage for unscheduled jewelry (jewelry that is not listed) on the policy. This coverage is subject to a deductible (often $500) and a ceiling of coverage (often $1,500) and these amounts can often be modified for an additional fee. Normally, this coverage is good only for fire or theft, not things like damage, partial loss (“The diamond fell out”) or mysterious disappearance (“My teenager had a party, and now my bracelet is missing”). This policy does not require an appraisal to be submitted in order to get coverage. These claims are settled according to a depreciated value, which insurance companies call “actual cash value” and appraisers call “replacement cost, comparable”. Sales receipts, photos and written descriptions are helpful in these claims.
A detailed description is especially important in insurance scheduling appraisals, since in case of a loss your appraisal will be all you have left to form the basis of your claim. Most people have replacement policies, which give the insurance company the option of replacing the jewelry rather than making cash payment. Therefore, the detail and accuracy of description in the appraisal is paramount. In addition, the appraisal should have photographs, an explanation of appraisal methods used, and generally be able to stand up to the scrutiny of the insurance adjuster-and the courts, if it comes to that.
Since contemporary jewelry scheduled on replacement policies is usually replaced with new jewelry, the appraised value is often higher for insurance scheduling than for other situations (where the jewelry is valued “as is”). If the jewelry is older-antique or period pieces-then replacement with new jewelry would not be appropriate. In those cases, the jewelry is valued according to the purchase price of an equivalent piece of jewelry of the same period, style, materials, conditions, etc.
The insured value is used to calculate the amount of your premium
You will be charged a percentage of the insured value every year. Under replacement policies, the insured value is used to set a ceiling on the amount that the insurance underwriter will spend to replace your jewelry. The value for claims purposes will be determined at the time of loss. Only detailed documentation will ensure that the replacement is of equal quality to your original items.
Under agreed value policies, the amount that will be paid in case of loss is agreed on in advance, with some exceptions. If a material fact is withheld that would have affected the decision of the underwriter to issue the policy (such as the actual price just paid) the claim may be cancelled altogether.
Please consult your insurance agent for clarification as to the details of your insurance contract. There are many types of policies, often custom-tailored to the needs of the insured, and laws regarding insurance vary from state-to-state. Your agent will explain the difference between scheduled and unscheduled and replacement and agreed value insurance. The best guide for knowing how your claims will be settled is to read the fine print in your insurance policy. Look under “jewelry and furs” on the basic homeowner's policy, and for scheduled jewelry read the terms in the insurance rider, floater or endorsement.
By law, only an insurance agent can give you advice about insurance. Be sure you have a clear understanding of the terms of your insurance contract, and read the fine print!