Getting a Jewelry Appraisal for Insurance: What You Need to Know
No one wants to think about their jewelry being lost, stolen or damaged, but it’s important to be prepared. Whether you have one cherished piece or an extensive jewelry collection, you should insure each item for its full value, just in case the unexpected happens. To do this properly, you need to have your jewelry appraised.
But before you do, it’s important to make sure you understand what a jewelry appraisal is, why it’s important for insurance purposes, where to get one, how much it costs, and more.
What is a Jewelry Appraisal?
A jewelry appraisal is a process through which a qualified jewelry professional or appraiser will examine your jewelry to determine its overall value. During this examination, the appraiser will use a variety of tools such as loupes, microscopes, and ultraviolet light to assess:
- The condition and quality of your piece;
- Gemstones and their characteristics (carat weight, cut, color, clarity);
- Quality and quantity of diamonds;
- Type of metal and weight;
- Quality of setting and more.
When the examination is completed, you will receive a written appraisal which will include: a detailed description and photograph(s) of your piece and an estimation of its current retail replacement value or how much it would cost to recreate it.
If you're having your jewelry insured, this is the document you’ll share with your insurance company. Make sure the jeweler or appraiser uses official business letterhead with their contact information in case your insurer has questions.
Importance of Jewelry Appraisals for Insurance
There are two main benefits of getting a jewelry appraisal for insurance purposes:
- It helps determine how much coverage you need. Your insurance company will use your appraisal to set the coverage limit on your policy as well as determine your premium (the amount you pay annually to maintain your coverage). Without an accurate appraisal, your jewelry could be over-inflated, which could lead to a higher premium; or you could be underinsured and end up incurring additional out-of-pocket expenses to repair or replace your piece.
- It helps determine the *retail replacement value or cost of replacing your piece in the event of a loss. If your jewelry ever gets lost, stolen or damaged, your insurance company will refer to the appraisal document to settle the claim. The detailed description of your piece will help a jeweler replace it with a new piece of the same kind and quality as the original.
*Keep in mind that the retail replacement value is not the same as the resale value. It’s a much higher estimate as it details how much it would cost for you to buy a replacement, not to sell the piece, which would have a lower market value.
In addition to insurance-related risks, there are a few other compelling reasons to get a jewelry appraisal:
- It substantiates proof of ownership in case your jewelry is ever stolen and recovered by police.
- An up-to-date appraisal keeps a record of the current value of your piece, in case you wish to sell it in the future.
- It helps to identify any loose stones or prongs.
Do I Need an Appraisal to Apply for Insurance?
We can't speak for everyone, but with Jewelers Mutual Group most customers can initiate coverage without submitting appraisal documentation. (There are some exceptions.) You do, however, need an appraisal (or other adequate documentation) at the time of a claim. To make things easier for you in the future, it's best to get your item appraised as soon as possible.
How Do I Find a Trustworthy Jewelry Appraiser?
It’s ok to get your jewelry appraised at your neighborhood jeweler but just make sure they have both gemological and appraisal training. The best way to find a qualified appraiser is through an appraisal association like the American Gem Society, the National Association of Jewelry Appraisers or Gemological Institute of America.
These associations have members nationwide and will likely have an appraiser in your area. A key advantage of seeking an appraiser through an association is that they require their members to meet specific qualifications and adhere to a code of ethics, so you can feel confident your jewelry is in good hands.
Do I need to bring any documentation with me when I go to get my jewelry appraised?
Yes. In order to give you the most accurate appraisal possible, bring any documentation you have for the piece, such as a sales receipt, previous appraisals, or laboratory certificates from GIA, EGL, AGS, etc. You should also bring the jewelry itself.
How Much Should a Jewelry Appraisal for Insurance Cost?
A competent professional appraiser will charge for services by the hour or a flat fee per piece.
Appraisal fees should never be based on a percentage of the jewelry's value. This is considered unethical because incentive exists to inflate the value to collect a higher fee.
On average, hourly rates range from $50 to $150, but it depends on the complexity of the piece. There’s laboratory work involved in inspecting and gathering facts about the piece, as well as market research to compare like pieces and the actual writing of the appraisal.
As with many other skilled services, you get what you pay for with an appraisal. If you’re offered a very low fee, you know the saying: It’s probably too good to be true.
How Often Do I Need to Have My Jewelry Appraised?
Jewelry fluctuates in value over time due to changing market conditions. If something happens to your jewelry and your appraisal is outdated, your item may be insured for less than its replacement value. To ensure your jewelry is covered for the right amount, we recommend you visit your jeweler or appraiser every two years.
So, there you have it! Whether it’s your engagement ring, an heirloom piece from your grandmother, or a new necklace, it’s worth getting your jewelry appraised for your financial security and peace of mind.
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