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Appraisal question?

barbie86

Rough_Rock
Joined
May 23, 2020
Messages
49
Hi all, I have a quick appraisal question if you don't mind.

We've paid £3650 for my ring. That was after shopping around and haggling; the next best price we could get (exact same diamond and setting) was £4250. Then after that, £4500. I've also been looking at rings for a while, and about 6 months ago the stones would have been about 20% more (we bought when COVID was at it's worst).

I have seen people say to insure for what you paid. My concern is I do think we actually got a 'good' deal, and I don't know that I would want to shop around as much if I had to replace. So, I had been thinking I might insure for around £4.5k.

Thoughts?
 

oldminer

Ideal_Rock
Trade
Joined
Sep 3, 2000
Messages
6,411
There is flexibility here and much of it depends on your willingness to shop diligently for a replacement or your choice to go the easy route and not shop so thoroughly. If you don't mind paying somewhat more than necessary for insurance coverage, then it is not up to the appraiser to insist. It is your money and your decision about the time required to make yourself whole in case of a loss. The point of insurance is to cover your loss. Knowing your own mind about how much effort and time you are willing to expend to make a replacement is a part of your process. In uncertain times, if you can afford it, I would suggest you don't take the minimum cost and assume a replacement price will be no higher in a few months or a year. It may be that prices will escalate and you'll need a new appraisal or at least an increase in coverage. You may not be aware of it until you have a loss since not everyone is on top of pricing all the time. I see no harm in a realistic bit of cushion in coverage amount, but I would not dictate my preference to a client. We try to make coverage sensible and well explained in advance of setting an insured value. Who knows, we may see falling prices before we again see increases. It is guesswork for experts who have been doing this for decades. Look at all sides of the issue and make your decision based on the facts and suggestions you feel are valid. Eventually, we will get back to a normal market environment where insurance near cost of purchase will be reasonably safe. Right now, I suggest you look at the possibilities and choose what you feel is affordable and responsible.
 

denverappraiser

Ideal_Rock
Trade
Joined
Jul 21, 2004
Messages
8,780
Pricing during COVID has become a tricky problem for appraisers. The usual definition of value for insurance is to estimate what an item would cost to replace at retail, new, locally, and in the usual and customary market. That’s open for a lot of troubles in the best of times but during the lockdown, the ‘usual and customary markets’ have largely been closed for months. There are, of course, other marketplaces, as everyone here knows, but that’s not the same question.

Fundamentally, most insurers are agreeing to replace with ‘like kind and quality’ or words to that effect. That's why people are advising you not to over-insure. They’re going to buy you a new ring, not cut you a check for the bottom line of the appraisal. They’re decently savvy and well-connected shoppers but they do have some limits that you don't. That’s where the appraiser comes in. It’s likely that your carrier is going to require documentation to support any value you supply so choose an appraiser who understands the issue. There are plenty out there.
 

headlight

Ideal_Rock
Joined
Nov 2, 2003
Messages
2,429
@oldminer and @denverappraiser please correct me if I am wrong, but for a new purchase the carrier would simply require the receipt. If the owner wants a different value they would require a current appraisal?
 

oldminer

Ideal_Rock
Trade
Joined
Sep 3, 2000
Messages
6,411
Some companies will take a receipt, so will not. If the receipt does not specify the aspects of quality, it likely will be insufficient to obtain coverage and if there is a loss, the facts for a similar replacement will be potentially a bone of contention. The adjuster may make it far more difficult than it was to pay for the "coverage". You learn that only too late. .Getting the details into your insurance coverage from the beginning.
 

barbie86

Rough_Rock
Joined
May 23, 2020
Messages
49
Thanks all. We plan to add it to our home and contents insurance, so the cost difference is negligible if we are talking £4k vs £4.5k vs £5k, for eg. However I don't see the point in over insuring, as as you say, they will replace the ring, not just cut a cheque for whatever the appraisal says it is worth (at least, that is the case on our policy).

The ring should come with an appraisal from the maker, which we can use.

My main concern is that once I get to wearing the ring (where damage/theft/loss will be most likely)it may cost more than we paid to replace. My other concern is that marquise diamonds are not all that easy to find in the UK. It took ages to find one that ticked all my boxes, and so I would like something of a cushion there so that I am not searching for 6 months plus to find a stone I am happy with, within the amount we originally paid, especially if prices go up.

With my first ring (cluster in RB stones) I insisted for the appraisal value, despite it being more than we paid, as a) I had had a lot of quotes in that range, b) it only made a difference of about £4 per year, and c) the market was fairly static. This time round it feels more complicated lol
 

denverappraiser

Ideal_Rock
Trade
Joined
Jul 21, 2004
Messages
8,780
@oldminer and @denverappraiser please correct me if I am wrong, but for a new purchase the carrier would simply require the receipt. If the owner wants a different value they would require a current appraisal?
The value conclusion is very rarely the #1 issue. As discussed repeatedly above, the carrier is generally agreeing to replace with like kind and quality, or words to that effect. It is functionally the purchase order for the replacement. They will take the description section of the appraisal, sans the price, and show it to several replacement jewelers to get bids. They'll buy from whoever is cheapest or, if you cash out they'll pay you whatever that jeweler quoted for replacement, less your deductible. Ending up through that process happy is all about the details. Sizes, weights, karatage, manufacturing techniques, dimensions, that sort of things. It's about the photographs and the 'simple' tests like counting the pearls. Secondly, the appraisal provides independent witness to things like condition, craftsmanship quality, even that the item actually exists at all. Yes, most sellers provide a receipt but that doesn't make it suitable for replacement purposes and, unfortunately, insurance agents are experts in insurance, not jewelry. They try to dot all the i's, but defining replacement specs isn't their job. That's why they're asking YOU to get appraised rather than doing it themselves. Even the ones who will be replacing in a store that they own won't do that.

Imagine, if you will, an 'appraisal' that says "14k gold ring with approx 0.50cts. total weight. $2500." I've actually seen this. I've seen it associated with claims and I see things like it on receipts and seller supplied documents often, even when that's not the transaction price. If you were an insurer, how would you replace based on that? It doesn't even say if they're diamonds, much less sizes and grades. Who made it? How? Do those things matter? Darned right they do. What's the cheapest thing you can make that meets that description? Pretty cheap. Certainly under $100.
As a consumer it's frustrating and it's NOT in your best interest but consumers are part of the problem. A reality check is easy. Read the report they give you. Does it give enough information? Are the photographs sufficient? Is the price reasonable? Is it signed? By whom? When?
 
Last edited:

headlight

Ideal_Rock
Joined
Nov 2, 2003
Messages
2,429
Thanks to the experts for your responses. In my head I know what my receipts have said and was thinking in that context: Specifically stated details of each element including mounting and referencing lab reports, accompanied by photos. I guess a main point to this conversation is get detailed paperwork!!! So important especially with the branded stones and designer mountings to have the best chance for replacement.
 

jBright

Rough_Rock
Joined
Jun 27, 2020
Messages
47
Thanks to the experts for your responses. In my head I know what my receipts have said and was thinking in that context: Specifically stated details of each element including mounting and referencing lab reports, accompanied by photos. I guess a main point to this conversation is get detailed paperwork!!! So important especially with the branded stones and designer mountings to have the best chance for replacement.
Hi! I don’t know if this will help. But I called jewelers mutual today, because I wanted to know the process to insure a loose diamond. And I’ve read a few posts that said not all insurance companies or renters insurance covers loose diamonds, but Jewelers Mutual does.

I, too, feel like I got a real good deal for my diamond. So I told them that, if God forbids, we lose my diamond what’s going to happen if I can not find the same quality diamond for the amount. They stated that they would cover up to the amount Insured and I can pay the difference. I’m totally ok with that, and hopefully will never have to use the insurance. Lol. Good luck!
 
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