Appraisal and insurance questions from a youngster

[Anonymous6]

Hey all... so now that my decision's basically been made, I'm doing research on an appraiser in the Houston area. I think I'm going with Ben Gordon based on some things I've read on PS (and he's listed on their list of independent appraisers)

I'm not really sure how it all works even after reading through some searches here on PS. I'm fairly young, don't own a house and my car insurance is still through my father (I just pay him)... so I'm wondering what route I should take as to getting my ring insured? I really don't have any assets at all under my name to be honest.

Do I even need to get it insured? I'm buying through Brian Gavin Diamonds if that matters.
What EXACTLY does getting it appraised do? It doesn't insure it.... is it just for personal matters or what? I know it tells you what the appraiser's value of the diamond is in relation to what you spent... but what do you do with that?

I'm completely oblivious, I know... I haven't really sat down and talked anything over with my parents yet. I'm a young guy fresh out of college who lives with his gf and pays rent to an apartment and has been saving money up for years to buy the engagement ring.... no really valuable assets, nothing really insured under my name.... and completely clueless as to the next steps to take here ha

 

[RockHugger]

Does BGD offer in house appraisals? Most diamond dealers do, you should ask them. Insuring is a personal choice, but if you get renters insurance, (15$/mo) you can add a rider to that for the price of your ring. You need a rider though because most policies only cover up to 1500 in jewelry.

 

[slg47]

I would get the ring insured, that way if something happens to it you are covered. I have a JM policy that lets you work with the jeweler of your choice in case of loss/theft/damage. As far as an appraisal, I just insured my ring for the value we paid for it. BGD also can supply a 'letter of verification' which is not the same as an appraisal but works for insurance purposes.

 

[stone-cold11]

To get insurance or not depends on if you think you can afford to pay for a replacement in the event of loss or damage.

 

[yssie]

you can insure with the paper that BGD gives you, but it will be painfully inflated and you will be paying the commensurate higher premium (unnecessarily, if something happens you most likely won't get what you're insured for, it just sets the absolute cap for what you *may* get). An independent appraiser (tell him you want it for insurance purposes) will give you a more reasonable value to insure for (and some insurers need an appraisal, not a receipt). More importantly though an independent appraiser will check the quality of the piece - that the stone is set well, that the ring is well-made, etc.


Since you are young and don't have much liquid spending money (to buy a replacement if something should happen) I would say it is even more important to get that thing insured! Our renters insurance was very picky on what they would and would not insure, reasons/causes for loss/damage, so we went w/ an outside company (jeweler's Mutual) that seems to have pretty comprehensive coverage (up to and including unexplained loss & owner stupidity) to avoid the headache. You can get the pricing from the website, it'll depend on what state you live in.

 

[Anonymous6]

Does BGD offer in house appraisals? Most diamond dealers do, you should ask them. Insuring is a personal choice, but if you get renters insurance, (15$/mo) you can add a rider to that for the price of your ring. You need a rider though because most policies only cover up to 1500 in jewelry.

My gf actually has the renters insurance under her name that we pay. I'll look into these details. Thanks

 

[denverappraiser]

There are 4 primary reasons that people have new purchases appraised.

#1 is because they want confirmation that they got what they thought they got. This includes matching the stone to the lab docs (if any), confirming the grading on those docs, confirming the condition, supplying whatever additional information they may need beyond what the lab did, and confirming or disputing other details that may have been supplied by the seller.

#2 is a quality control step on the finished piece. This includes the condition of the stone after setting, the condition, authenticity and craftsmanship of the mounting, the quality of workmanship on both the mounting and the assembly, etc.

#3 is documentation for insurance. This is effectively the purchase order for the replacement of the piece (not just the diamond) in the case of a loss and includes photographs, the lab report, weight, metal and design details, size and whatever other details you may want to be sure are considered if a replacement becomes necessary as well as to provide an avenue for funding to do that.

#4 is the price.

Deciding whether or not the seller supplied you sufficient paperwork for any or all of the above purposes is up to you. Most sellers will provide a receipt, most will include a document they call an appraisal , and most aggressive shoppers have a pretty good idea of what similar things cost from the competition so it’s not necessary for everybody. If you have questions or concerns about the merchandise, if you’ve got nagging doubts about the dealer or craftsman, if their paperwork isn’t sufficient to exact replacement or if it contains information that you KNOW to be false (like an insanely inflated price), I would recommend a new item appraisal but otherwise you should be fine.

 

[Anonymous6]

Thanks for the response!

If I were to get a rider through my renters' insurance for the ring, would I need to get it appraised first?

 

[denverappraiser]

Thanks for the response!

If I were to get a rider through my renters' insurance for the ring, would I need to get it appraised first?

Your insurance company will require documenation on what you have and it's entirely possible that they will accept paperwork supplied by your seller. Ask 'em. Their standards are usually pretty low. It's YOU who may want to be a bit more picky.

 

[MarkBroumand]

you can insure with the paper that BGD gives you, but it will be painfully inflated and you will be paying the commensurate higher premium (unnecessarily, if something happens you most likely won't get what you're insured for, it just sets the absolute cap for what you *may* get). An independent appraiser (tell him you want it for insurance purposes) will give you a more reasonable value to insure for (and some insurers need an appraisal, not a receipt). More importantly though an independent appraiser will check the quality of the piece - that the stone is set well, that the ring is well-made, etc.


Since you are young and don't have much liquid spending money (to buy a replacement if something should happen) I would say it is even more important to get that thing insured! Our renters insurance was very picky on what they would and would not insure, reasons/causes for loss/damage, so we went w/ an outside company (jeweler's Mutual) that seems to have pretty comprehensive coverage (up to and including unexplained loss & owner stupidity) to avoid the headache. You can get the pricing from the website, it'll depend on what state you live in.

I'll second Yssie.

 

[vintagelover229]

I've worked with an appraiser in that area twice now, and he's great. He's actually in the same building as WF, just on a lower floor. He's 100.00 flat rate and provides you with papers, photos, etc everything you need for the insurance company.

Ben is a good appraiser, but when I called he wanted 250.00 per hour and I only had one piece that needed to be done, so it wasn't worth it for me to use him.

Here's the info on the guy I use. At one point he had the incorrect number listed, I'm not sure if this is fixed. He is really great and quick too and will either give the papers to you on the spot or mail them to you in a nice folder and everything.

Lastovica Jewelry Appraisal
6222 Richmond Ave, #830, Houston, TX 77057
(713) 783-8098


Like I've said, I've used him twice. The first was a stone I bought from GOG (cushette) which the specs checked out on and the other was an estate piece that I had bought for a bargain. I wasn't even sure the thing was real I got such a good deal on it (paid 4500.00 transitional ideal cut diamond circa 1940 setting) and it was sold as a 1.6 H VS1 (or higher the seller wasn't sure) and he did his thing and it was 1.64 H VVS1 and appraised at 25k. He was super friendly and filled everything out right there because I was preparing to leave the country. Just be prepared to show your ID to the door guy because that's the only way your getting in the building.

I hope this helps!

ETA: Contact Jewelers mutual for a quote on insuring the ring. They have plans where you can pay monthly or just a couple payments or one lump some. To insure my ring (for the replacement value of 25k) in Canada it's only 300.00 a year to insure my ring, so it should be less than that for a ring that is appraised for less. I had to insure my ring for more than I paid for it because I couldn't' replace it for what I paid for it, but if you just have a receipt, you don't need an appraisal and you can insure it for the amount you paid (because you can probably replace it for that amount again). Jewelers mutual also just cuts you a check where's a lot of other companies try to give you "their stone" which aren't nearly as nice as the one you bought from BGD.

Also I want to say good for you saving up and buying a ring! It takes a lot of discipline to do so when your in college!

 

[Anonymous6]

Thanks for the response!

If I were to get a rider through my renters' insurance for the ring, would I need to get it appraised first?

Your insurance company will require documenation on what you have and it's entirely possible that they will accept paperwork supplied by your seller. Ask 'em. Their standards are usually pretty low. It's YOU who may want to be a bit more picky.

So, let's say the document from the vendor has the price of the ring for what I bought it at.... and I get it appraised and it is appraised for $10,000 more than my purchase price.

Which one do I bring to the insurance company? Or does it not matter?

 

[LGK]

I often just use receipts to insure (I use jewelers mutual) if I feel that I could replace the item for that price. If you insure for an inflated appraisal, you pay way more in premiums but aren't likely to actually be able to use that price. essentially, what an insurance company pays out is what they can replace the item with like kind for. Say you paid $1K for a branded diamond, have it appraised for $2K and insure it for that, and then lose it. The insurance company will pay what it costs to replace that stone- which is probably around $1K. Not the $2K you had it insured for. Lol, hopefully that makes sense!

Not all appraisals are inflated- you just want to get a good independant appraiser and make sure they know what you need (insurance documentation.) However, you can usually use your receipt or the valuation letter you got from GOG.

Since your diamond is a branded one, you want to make absolutely positively sure the insurance co has that documentation. You don't want them insisting that you replace a beautifully cut branded stone with some random generic thing.

 

[denverappraiser]

Thanks for the response!

If I were to get a rider through my renters' insurance for the ring, would I need to get it appraised first?

Your insurance company will require documenation on what you have and it's entirely possible that they will accept paperwork supplied by your seller. Ask 'em. Their standards are usually pretty low. It's YOU who may want to be a bit more picky.

So, let's say the document from the vendor has the price of the ring for what I bought it at.... and I get it appraised and it is appraised for $10,000 more than my purchase price.

Which one do I bring to the insurance company? Or does it not matter?

It depends. Talk to your appraiser about WHY the price is so different. It may be a fundamental misunderstanding on what the item is, it may be a difference in the market choice, it may be a difference in what they consider a reasonable dealer markup is, it may just be a typo. These are not all the same. As has been pointed out several times above, the value conclulsion is NOT the primary objective of a new item appraisal. The point is understanding and documenting what you've got. The one to submit to the insurance company is the most complete and accurate set of documentation at your disposal. Don't be shy about showing the appraiser the rest of the document pack that came before them. Actually, they should ask for it.

 

[4cynthia]

You brought up some excellent points, LGK!

With Jewelers Mutual, you can add items valued at $5,000 or less to your policy with a receipt only (no appraisal needed!). However, the same requirements needed for appraisals apply – your receipt must be dated within the last 18 months and include a detailed description of the item, including any gemstones and setting information available.

Like you had mentioned, it is very important to talk to your appraiser about the value of your jewelry. Over-insuring your jewelry is in no one’s best interest, but neither is underinsuring. Getting your jewelry properly appraised will help Jewelers Mutual assure that if the item is ever lost, stolen or damage, you can get it replaced with the same kind and quality of the original.

I’m so glad you mentioned brand because that information is absolutely crucial as part of your appraisal so that you can get the same brand-name jewelry as you had before. A properly written, detailed appraisal helps determine the amount of insurance coverage needed to restore or replace the item. Receipt values are often times not an accurate depiction of the true value of your piece of jewelry. It’s important for Jewelers Mutual to get you back to the position you were in before the incident occurred, making appraisal values essential.

Cynthia Moschea, CSA, AJP (GIA), GIA Diamonds Graduate
Jewelers Mutual Insurance Company

 

[Anonymous6]

Just giving rough estimates... will get it appraised and go to JM to get some quotes, but wondering if you can get any kind of estimate on what I'd pay to have my ring insured

Say the stone was around $12,000 and the setting was $2,000 makin it $14,000... I'm not sure what it'll get appraised for but let's say something higher than that.

What all am I looking to pay to be insured through JM? I have yet to research this, as I don't have the ring in my hands yet.

 

[denverappraiser]

Insurance rates vary from company to company, state to state and even city to city. It's against the rules for Cynthia to link you to her site but I have no such restriction and the Jewelers Mutual pricing system is entirely online. Just fill out the form and it'll give you a personalized rate quote. You can even tweak the parameters and see what changes if you change your coverages, your deductible or you decide to move to somewhere like Fargo ND (insurance rates are really good there). There's no obligation and you don't even have to provide your name so if you want to bail at the last minute there's no cost or even junkmail as a result.

 

[pinoybruin]

Anonymous,
Like most games in life it is safe to straddle the middle. Don't underinsure your ring and don't overinsure you ring because in both cases you will lose money if anything would happen. If you were to insure your setup with your current BGD appraisal I would assume you would be paying a premium with an inflated value of some sort (slowly losing money each month depending on the price difference). However, say you appraise it independently and get a appraised value that is lower along with detailed documentation you would be saving money (long term) on the premiums.
It would be helpful if the PS community provided us with information for proper insurance i.e. vendor, vendor appraisal, and independent appraisal. That way everyone can have an idea about inflation and whether or not an independent appraisal is necessary for insurance purposes.

 

[4cynthia]

Congratulations, Anonymous6!

What an exciting chapter you’re about to embark upon with your girlfriend as an engaged couple! Now that you’ve pick out the ring (Whew… one hard part done!), it sounds like you’re doing the smart thing by researching your options for insuring that precious piece of jewelry. Denverappraiser was absolutely right in his recent reply (thank you!). Like he had mentioned, you will find in your research that insurance coverages and premium amounts vary based on a number of factors, including where you live, deductible amounts, the ring’s appraised value, etc. Jewelers Mutual is no different. To give you a rough idea, you can expect to pay between $1 and $2 per $100 worth of jewelry. Keep doing your research—the web is a great tool for you to use to help find the right carrier for you. Good luck in your search and in your engagement!

Cynthia Moschea, CSA, AJP (GIA), GIA Diamonds Graduate
Jewelers Mutual Insurance Company

 

[lovemybling]

Most people I know who have gone the renter/ homeowner route have regretted doing so. It was a huge hassle.

Stick with someone Like Jewelers Mutual who specializes in this type of insurance. If something happens you will be glad you did.

 

[pinoybruin]

I just visited Carole at Los Gatos and I decided to use the appraisal provided by JA. Granted the JA was inflated but the difference did not warrant a full appraisal. I came to this conclusion by comparing the cost of the appraisal divided by the difference in annual premium cost. It would take a couple of years to make up the cost.

 

[Cobra]

I'm going to piggyback on this thread here.

So I bought the ring and the receipt is under my name. When I went to get it appraised, I asked whose name the appraisal should contain for insurance purposes. Considering that the ring will belong to my girlfriend in the future, it was decided that her name would go on the appraisal. Now, after some thinking, I feel that maybe my name should have gone on the appraisal since the receipt is in my name. In the event of a claim, I'd imagine the insurance company would need to verify ownership of the ring.

Did I do something wrong here? I take it this is a very common situation since the guy buys the ring. Does the name on the receipt, appraisal, and insurance all have to match?

Thanks in advance.

 

[Gypsy]

Just as an FYI you might need an appraisal every 3-5 years though, just to make sure your valuation is up to date in the event of a loss, if there are large fluctuations (increases) in the price of metals or diamonds.

 

[yssie]

I'm going to piggyback on this thread here.

So I bought the ring and the receipt is under my name. When I went to get it appraised, I asked whose name the appraisal should contain for insurance purposes. Considering that the ring will belong to my girlfriend in the future, it was decided that her name would go on the appraisal. Now, after some thinking, I feel that maybe my name should have gone on the appraisal since the receipt is in my name. In the event of a claim, I'd imagine the insurance company would need to verify ownership of the ring.

Did I do something wrong here? I take it this is a very common situation since the guy buys the ring. Does the name on the receipt, appraisal, and insurance all have to match?

Thanks in advance.

When you submitted for insurance did you use your receipt or the appraisal? If you're concerned you might call in and see what they have to say, and email them a picture of the receipt so they have it on the books, but I can't imagine this will pose any sort of real problem should you need to make a claim. I don't see why they would care who paid for the piece, only that someone is paying the premiums for it.

 

[4cynthia]

Cobra, there is no need to worry if the receipt has your name on it and the appraisal is under your girlfriend’s name. What is important is whose name is on the policy. The name of the person who will be wearing the ring should be on the policy. But keep in mind that if you want to have the ability to make changes to the policy or be the one we contact in the event of a loss, then you’ll want to have your name on the policy as well.

And to clarify with Gypsy, a new appraisal may not be required every three to five years, but we DO recommend getting your jewelry re-evaluated yearly so that values can be updated. In the event of a loss, having your jewelry periodically revalued to current replacement costs—and insurance coverage adjusted accordingly—allows us to replace your jewelry with the same kind and quality as the original. Our goal is to make you “whole” again by getting you back to the position you were in before the loss occurred.

Cynthia Moschea, CSA, AJP (GIA), GIA Diamonds Graduate
Jewelers Mutual Insurance Company

 

[Faluzure]

This is an excellent thread, as I too am pre-shopping for insurance for a ring I'm about to buy from GOG. My diamond is a custom cut diamond with a GIA cert and the setting itself is a custom made setting. I expect to have official papers on both.

So it's my understanding that you have to supply the sales receipt AND the appraisal papers to the insurance company. Consider this example, the engagement ring costs $14,000 and gets appraised for, lets say $20,000. For the premium, I'll be paying for the $20,000 price but in the event that it gets lost/stolen, I'll be getting compensation for the sales receipt price of $14,000.

I've heard many of you say to go back to the appraiser and get a more realistic value BUT, I'm wondering why you can't just omit the appraisal altogether and use that sales receipt for your documentation. After all, you'll only be compensated for that price anyway. Shouldn't having the GIA papers and authenticity documents on the diamond and ring should be sufficient evidence to document & supplement your sales receipt? Or is the appraisal an absolute required on any kind of insurance?

I'm looking at Jewelers Mutual for now simply based on the fact that it's been suggested in this thread as well as other Pricescope forum threads.

 

[jsb15]

I found this forum after needing to replace a diamond lost when a prong broke and am dealing with the insurance right now. First, unless you have a really unusual policy like Chubb that pays cash on whatever the appraisal states, you should insure it for your actual cost and not the inflated amount. I can't imagine that submitting the bill of sale and a lab report would be a problem even if you sent the "inflated" appraisal. My insurance was adequate in dollar anmount to replace a very fine (triple ex or AGS 0) stone but since my appraisal did not have cut characteristics, they offerred to pay an amount for the cheapest "very good" stone they could find. In hindsight, I should have gotten a GIA/AGS cert on my stone that did not come with one 20+ years ago and insisted that my recent appraisal value was for the realistic replacement cost. The insurer was happy to take 30% more in premiums all these years but it would have cost a fraction of that amount to get a solid cert to prove I was entitled to a specific quality replacement.

Also, for the OP, you may find that a renter's policy will not cover an expensive ring. I had renters insurance when I got the ring and my insurer refused to cover a $10K engagement ring (actual cost about $6500) when I only had $15K in content coverage for everything else I owned. I had to change renters policy company and I had apprasial dropped to $9900 either becasue that company required it or there was a significant break in the insurance cost - can't remember now.

 

[Modified Brilliant]

Thank you for the valuable information Cynthia.

The vendors here on PS usually provide very detailed and accurate descriptions on their appraisals.

Unfortunately it's prevalent in the retail sector, that detailed descriptions are lacking.

Hand written appraisals with barely enough information if a loss occurs is still common.

The seller is not doing you any favors by giving you an appraisal with missing information.

Oftentimes, important items such as the measurements of a stone are not recorded.

The more information the better. Better for you and better for the insurance company if you ever need a replacement.

 

[Valjean]

Don't mean to hijack the thread but when an appraiser inspects the diamond on the ring, does he or she take it out of the setting and re-attach it after? I feel a little nervous about this if that is the case since it might weaken the prongs or something.