Another appraisal/insurance question

[sparkler29]

This has probably been addressed but I have a quick question about the relationship between the amount stated on an appraisal and the amount of insurance needed. My fiance purchased my diamond and did not have it independently appraised (how many times did I tell him to read up on Pricescope?!?!?).

The vendor had it set in the current simple white gold setting and wrote out his own "appraisal." This appraisal states that the worth of the diamond is double what my fiance paid. OK, this made my fiance feel good and think he got a good deal (which it looks like he did after searching on PS for comparable stones - Yay!). He paid slightly below what the PS vendors list for a stone with equal specs. Anyway, now that I''m looking into insurance, it appears that I have to send them a copy of the appraisal, and because the appraised value (again, not an independent appraisal) is so much higher than we paid, it is really increasing the quoted yearly premiums. When I asked if I could just insure it for slightly above what we paid, they said that they needed a copy of the appraisal. So it seems we''re stuck. The companies I''ve called so far are Chubb (Plib. and stand-alone), Traveler''s and my current renter''s insurance company, Allstate.

What do you recommend - should I have the diamond/ring independently appraised at this point? Will the value be any lower? Why can''t I just have the ring appraised for the amount we paid?

 

[wonka27]

If you want a maximized work up on a diamond, having the stone loose at the appraisal is important. However, given it is put together, if you find a good independant appraiser, you can get a fair appraisal of the diamond. It may not get you all the angles, etc., but you can find out a value for insurance purposes. If you want the complete work up, you may be able to work something out with the jeweler to take the stone out, appraise it, and have them reset it.

To me, it sounds like you are worried more about the value for insurance purposes, so I'd just take it in. Remember, you insure for one value, but that doesn't mean an insurance company will pay out that amount to replace it.

 

[reena]

my experience with chubb is that they WANT you to insure it for the appraisal price (for obvious reasons) but, plain and simple, they can't "make" you. they tried to do this to me, too, but i was adamant that i was insuring for the purchase price, period. and the lady relented. i told them i would send them a copy of the appraisal for their records only.

i suggest you push back and see what happens. there is NO reason that i can see to insure your ring for twice what you paid and deal with those premiums--especially cause you're in NYC like me! they're sky-high as is.

 

[cflutist]

I have some of my jewelry (the expensive ones) insured on a Personal Articles Policy (aka "floater", aka "rider") with State Farm. If a loss occurs, they will pay ONLY what it costs THEM to replace it. So if we can buy at a discounted price, they can sure buy at that price too!!!

 

[sparkler29]

Thanks - Reena hit the nail on the head - it's SO expensive in NYC to insure an engagement ring (or expensive jewelry in general). For example, Chubb stand-alone will cost us $437 per year with the quoted appraisal amount.

Allstate is an additional $450 per year (in addition to our current renter's insurance). And switching to Chubb (both renter's & jewelry insurance) is going to run us about $900 for the annual premium.

I'm going to try Reena's tactic of pushing back - so what you're saying is that there is no way that they can deny my request to insure the ring for whatever amount I want? I guess if I say I'll take my business elsewhere they will probably be more flexible.

 

[reena]

i mean i guess i shouldn't say there's no way . . . but i don't see how they can force you to insure it for more than you want to. and if they say no, i will give you the number of my chubb agent (in seattle) who will do it for you. (you can tell them THAT.)

they didn't con you into buying renters' insurance too, did they

 

[hoorray]

If the pushing back doesn't work, get a simple independent appraisal, telling the appraiser up front what kind of value you want listed (realistic replacement cost for insurance purposes). Appraisers recognize that there are many different types of values, with full retail being the highest. No insurance company pays full retail.

My appraiser discussed what he thought the ring should be able to be replaced for by someone with good buying power (aka insurance companies). My insurance company (USAA) let me help decide what a reasonable replacement value to insure it for would be, so I insured it for just more than we paid to give us a little room for change. That appraisal only cost around $50 since he didn't do the full work up. It saves me much more than that a year in premiums. (For years I paid premiums based on these inflated 2x appraisals. It won't change what you get form the insurance company in the long run if the policy is a replacement or refund at their choice type, it will only cost you more in premiums.)

 

[reena]

that's a really good point by lop re: the type of policy you have. with chubb, you get a check for the insured amount in the case of loss, so at least you have the chance to recover a higher amount if you're paying a premium on a higher amount. (i STILL wouldn't pay the premiums on the inflated appraisal value tho.) it's even worse with a replacement-cost type policy, where as lop said, you won't get any added value out of it.