Insurance and appraisal

[ko]

I stumbled upon pricescope only recently when researching for my e-ring. You guys are simply the best!

I would greatly appreciate if anyone could answer my query.
The jeweller from the shop where I purchased my ring has offered to value the ring for me for the purposes of insurance, and he said that the valuation will be almost double what we paid for it.
Is it wise for me to let him value my ring or should I bring it elsewhere for independent valuation?
Many thanks!

 

[Lorelei]

Hi Ko and welcome!

I am not an expert here, but I think it is usual that the valuation is normally a fair bit more than the purchase price. I am sure that there will be others who can answer this in much more detail - my diamonds are appraised for an amazingly large amount compared to the purchase price. Good to have you with us, I know you will enjoy PS!!!

Also if you use the search tool at the top of the page and type in valuations, it will come up with tons of advice and info on the subject - which will help out until more people see your post.

 

[perry]

It is my understanding that the better appraisers will typically value something at market price + 10 to 15% to handle inflation for the next couple of years.

Assigning a value of much greater than the market price is a form of fraud in my opinion, and indicates in my mind a dishonest jeweler. However, it does give the customers a false sense of value so they feel better about the price they paid.l

Keep in mind that your cost of insurance will be directly linked to the declared value. Thus, if the ring is valued at twice the cost - you will pay twice as much for insurance. Should you loose your ring (or other damage) the insurance will only pay for the cost of repair or replacement.


But it is your choice. Just don''t ever thing that it is in fact worth as much as such a valuation claims it is.

Perry

 

[jewelgirl]

I think this depends on how you feel about insurance...

My first e-ring was stolen, and I was very very happy that it was appraised at 4-5k more than we had paid for it. I was able to replace my stone with an even (technically and by the specs) better stone! Then, again, I had chubb, and they just cut me a check for the appraised amount.

With my new e-ring, It was appraised by a jeweler for more than twice what I paid, and I will insure it for that amt, because I know the value of insurance, now.
True, it will cost more in yearly premiums, but it is worth it to me to have the peace of mind.

I am also getting an appraisal done by an independent gemologist, so I have a good idea of the true value of my purchase. I amvery curious to see what it comes up as

 

[allycat0303]

Hi Ko,

I don''t know if this applies, but my boyfirned recently got insurance for my loose diamond. We insured it for the amount he paid because we didn''t want to pay a lot every month. I basically figured, if it gets broken, this is how much we would need to buy another one from Whiteflash. Hopefully that won''t happen. I would probably get an independent appraisal just to insure that what I bought from the jeweler is what he says it is, and to get a fair market price for the ring.

Good luck!

 

[RockDoc]

Date: 7/26/2005 7:15:16 AM
Author:ko
I stumbled upon pricescope only recently when researching for my e-ring. You guys are simply the best!

I would greatly appreciate if anyone could answer my query.
The jeweller from the shop where I purchased my ring has offered to value the ring for me for the purposes of insurance, and he said that the valuation will be almost double what we paid for it.
Is it wise for me to let him value my ring or should I bring it elsewhere for independent valuation?
Many thanks!

Technically, the seller should not write a report for an item that he sold WITHOUT DISCLOSING HE SOLD IT.

He can certain write you a Statement of what the replacement cost would be in his store, but that is about how it should be limited. If the valuation is more than the purchase price, this should be dislclosed to the insurance company, and a thorough narrative explanation to support why a higher value was used should be in the report.

This is why it is important to have the item valued by a person who does NOT have an interest in the item or it''s sale. This is where an independent appraiser who is properly credentialed and write the proper report can save you a lot of grief later.

There is also some meaningful consideration that needs to be made based on the type of policy you purchase.

The opinion of adding an amount to the purchase price, as Perry stated is absolutely a very wrong thing to do. WHY? Because it isn''t supportable. This is nothing short of crystal ball mentality, and has no basis of fact.

Rockdoc

 

[jewelgirl]

I do agree with Rocdoc on how an appraisel should be done honestly with disclosure within reason. But in buying a stone from an internet vendor, I believe that the stone is worth more than you will pay for it.

As such, I believe that the stone should be appraised based on what the stone is worth if bought in a B&M store, not from an internet vendor. Why should you be "penalized" based on the fact that you were smart and bought your stone from a source with lower overhead/fixed costs?

And why should you have to divulge that you got a great deal and only insure for a value you may never be able to get again???? If you bought a car for 5 k under invoice in a great sale, and totalled it in a wreck driving off the dealers lot, your auto insurance would give you the full value of the the vehicle, not the discounted price you paid.

In addiition, I think as long as you tell your insurance co that the person you bought your stone from also did the initial appraisel, and they accept that, it should not be a problem.

I think the real problem is in that there is no standardization in valuation of diamonds. The Rap, as we all know, has its issues. But really, why should there be 1 standard of value for 1 certain store and andother for a whole other type of store? Diamonds are diamonds...why SHOULD they be appraised based on where the were bought and for how much, and not on the worth of the thing itself?

 

[Regular Guy]

Ko,

If you feel as though you shopped wisely for your diamond, I think the thing to do would be to make sure it is described thoroughly in whichever appraisal you submit to your appraiser, so that if and when it should need to be replaced, regardless of the valuation, a diamond of like kind would replace it. It''s frequently the case that an independent appraiser will do a better job of documenting this for you than your jeweler, but I don''t know that to be the case.

Since cut is well valued here, that is the thing I would want to have documented, if you feel the option you got conforms to that. The other Cs tend to be more straightforward all around.

Regards,