Appraisal Insurance Quote vs Purchase Price...

[deggles]

I just got my e-diamond appraised this last weekend and I''m not sure whether to be questioning/disappointed by the appraiser''s insurance quote. I''ve heard many stories on PS about people getting stones/rings and being appraised for twice the purchase price, is this common? My stone has the following specs...

1.11ct Round ''A Cut Above'' H&A
Color: G (appraiser said closer to F)
Clarity: SI1
Table: 56
Crown: 35
Pavilion: 40.6
HCA: 0.7
Price: $6,659

The appraiser actually said that the performance of my stone would be equivalent to the absolute best stone in just about any diamond showroom. She said it was absolutely brilliant, yet she put replacement value at only about $7,100 (about $400 over purchase price). She supported this price by saying that even if she gave a value of $10,000, the insurance company would only pay the value of what they could find the ''same'' stone for in the marketplace. And with the emergence of the e-diamond marketplace, there was no need to value the stone any higher because it would just translate into higher premiums for me. Is this the correct way to look at it? I just want to be sure I''m protecting myself...

Thanks again,

deggles

 

[FireGoddess]

I think it''s possible your appraiser gave you a true, current replacement value rather than the inflated values a lot of places give. Frankly, I would rather insure my stone for closer to what I paid for it rather than twice its price, because it really DOES double the insurance premium. But my appraisal price is inflated, and I pay for it in insurance premiums. The only thing I question is that diamond prices usually only go up each year...and in 2 years, you probably wouldn''t be able to buy the same stone at that payoff price. Hmmm...hopefully some experts will chime in...

 

[Mara]

See my response on the other thread "insurance for WF ring" thread....regarding a similar issue and insuring for appraisal amount, inflated amounts etc.

In terms of the diamond prices going up, from 2000 til about last year, there really were no big increases in diamond prices, the market was relatively flat. It was only starting last year that the prices really started to rise. So unfortunately, the typical inflation amounts will not really match up to what is happening in the industry right now...just as if I bought a stone in 2000 and didn't get an updated appraisal today, chances are my stone value would be far underneath fair market, even with the insurance co building in typical inflation.

Your appraiser sounds like they gave you a very realistic amount, you may go back to them and note the diamond increases and see if they can up the amount slightly to cover that. Or the other alternative is to get a new appraisal next year if prices have really gone up, and then use that new amount.

Your appraisal is not a one time deal, you can have it re-appraised later to bring it up to fair market value and ensure that you are always up to date. It costs, but if it's important to you...

Lastly, appraising for double the amount doesn't really mean much in my eyes. Appraisers, like diamond graders, are all different. My appraiser is pretty realistic and doesn't overinflate my appraisals. I guess I could feel sad or insulted, but in reality I know she knows her stuff and if she compliments my stone saying it's exceptional, then I know she means it.

Good luck.