How much do I insure my e-ring for?actual cost or appraisal?

[metsfan2016]

I just got my engagement ring and now I'm looking to insure in. I've heard several good things about Jewelers Mutual and am planning to use them (please chime in if you have heard otherwise, I'm open to suggestions). My question is, how much do I insure it for....the actual total cost of what I paid or the appraisal (which is several thousand dollars more and includes 5 years of inflation)? It would cost me $83 less to insure for what I actually paid. Essentially I'm wondering why I should pay a higher premium for an appraisal. What is your recommendation and why? Thanks!

 

[YadaYadaYada]

Re: How much do I insure my e-ring for?actual cost or apprai

I used to work for an insurance agency and it was my experience to always insure for appraised value. The reasoning behind this was in the event of a loss and needing to replace the item, you may not necessarily be replacing from the same jeweler who sold you the original ring and because prices vary from place to place, the appraised value was used. In addition a good appraisal has very specific information so that a stone would be replaced with like kind and quality and the workmanship of the setting would also be noted ensuring that you would in fact be able to replace a piece with the same workmanship and attention to detail as the original.


That said, you would want to obtain an independent appraisal that would be a true accurate assessment from an impartial qualified appraiser so that you are not paying a premium for an inflated value but for the true cost of replacement.

 

[metsfan2016]

Re: How much do I insure my e-ring for?actual cost or apprai

I used to work for an insurance agency and it was my experience to always insure for appraised value. The reasoning behind this was in the event of a loss and needing to replace the item, you may not necessarily be replacing from the same jeweler who sold you the original ring and because prices vary from place to place, the appraised value was used. In addition a good appraisal has very specific information so that a stone would be replaced with like kind and quality and the workmanship of the setting would also be noted ensuring that you would in fact be able to replace a piece with the same workmanship and attention to detail as the original.


That said, you would want to obtain an independent appraisal that would be a true accurate assessment from an impartial qualified appraiser so that you are not paying a premium for an inflated value but for the true cost of replacement.

thank you for your response. Is there a way I could use both my receipt and my current appraisal.....basically I'm wondering if I can insure for what I actually paid and make sure I get the same quality by submitting the sarin/asset/appraisal. Or will they make me insure for the appraisal amount if I submit the appraisal?

 

[YadaYadaYada]

Re: How much do I insure my e-ring for?actual cost or apprai

I can't answer that because it comes down to the company and we didn't work with Jewelers Mutual. Maybe someone here who has insured with them could chime in otherwise you would probably have to ask them what they require and go from there. With the companies we worked with anything over $10,000 required an appraisal.

 

[metsfan2016]

Re: How much do I insure my e-ring for?actual cost or apprai

I can't answer that because it comes down to the company and we didn't work with Jewelers Mutual. Maybe someone here who has insured with them could chime in otherwise you would probably have to ask them what they require and go from there. With the companies we worked with anything over $10,000 required an appraisal.

Thanks so much StephanieLynn....I paid over $10,000 and didn't realize that I may need an appraisal based on that alone.

 

[sassy_pants]

Re: How much do I insure my e-ring for?actual cost or apprai

I realize this wasn't your question, but I think it might lead to the answer. Rather than the insured value amount, you might want to focus on what the insurance company would do in the event of a loss. Would they replace with like kind and quality based on the appraisal description, without you having much choice in what is chosen? Or would they cut you a check for the insured amount and let you do what you wanted with the money? Or would they let you chose your own new stone that fits the appraisal description, and reimburse the vendor directly? I don't know anything about JM, but most insurance companies go with the first option. They replace with something they consider similar, usually they are able to buy from a wholesaler well below your insured value. I which case, you'd want to go with the lowest insured value you can for your detailed description.

 

[diamondseeker2006]

Re: How much do I insure my e-ring for?actual cost or apprai

If you bought at retail, the price you paid is the true replacement value. Diamonds do not necessarily go up in value every year and don't always have increases that correspond to inflation. My items bought a couple of years ago are not worth a penny more and might be less. I never insure for more than I paid, and I request that the insurance valution ("appraisal") reflect what I paid. Just be sure you include the diamond grading report and complete information such as if the stone is a branded one. I see no advantage to the insured to over insure. If the item cost $10k and is appraised at $15k, the insurance company is not going to pay $15k for the replacement. They'll replace with exactly what you had which is a $10k diamond that they can probably access for less than that. Obviously if diamond prices increase significantly, you can get a new appraisal but stress that you do not want an inflated value. You can always go on a site like James Allen and see what similar diamonds cost to get an idea.

 

[WinkHPD]

Re: How much do I insure my e-ring for?actual cost or apprai

If you bought at retail, the price you paid is the true replacement value. Diamonds do not necessarily go up in value every year and don't always have increases that correspond to inflation. My items bought a couple of years ago are not worth a penny more and might be less. I never insure for more than I paid, and I request that the insurance valution ("appraisal") reflect what I paid. Just be sure you include the diamond grading report and complete information such as if the stone is a branded one. I see no advantage to the insured to over insure. If the item cost $10k and is appraised at $15k, the insurance company is not going to pay $15k for the replacement. They'll replace with exactly what you had which is a $10k diamond that they can probably access for less than that. Obviously if diamond prices increase significantly, you can get a new appraisal but stress that you do not want an inflated value. You can always go on a site like James Allen and see what similar diamonds cost to get an idea.

Diamond Seeker is giving you good advice.

I have done a LOT of insurance replacement work over the years. Jewelers Mutual is a replacement policy, so the way to be sure you get what you had is to have a GREAT appraisal, not some fluff written without good documentation. If you got a branded diamond, make sure the brand is included in the appraisal documents. If your diamond was Hearts and Arrows quality, make sure that also is in the documents.

Personally, I will often write an Evaluation for Insurance Purposes with about a 10% cushion as I know that most will not follow the market and get the ring reappraised when they need to. IT IS YOUR RESPONSIBILITY to have the appraisal updated when needed though, so you should keep an eye on the market.

Frankly, for an appraisal that is 50% more than you paid for it, the appraisal should contain a statement as to why it is appraised so high. I am guessing that did not happen, but you will be able to read the appraisal and know for sure. If I buy an estate piece and sell it for a price that I can not replace it for, I always document this in the appraisal and appraise it for what it is worth to replace, if it is even possible. That way the insurance company can not holler "Calf Rope" if the piece is lost or damaged, as they already have it in writing why it is appraised for more than it sold for.

I am sure my friend Neil (Denver Appraiser) can put this in a more articulate manner, but for normal usage, you do NOT need an appraisal for 50% more than you paid. Even if you had a cash out policy, the insurance company is going to be calling people like me that do insurance replacement work and get some quotes prior to writing that check. They will NOT pay you more than they can buy it for elsewhere.

Wink

 

[DAF]

Re: How much do I insure my e-ring for?actual cost or apprai

We insured my rings for what they actually cost. JM increased the policy premium on their own based on inflation, I believe it was for an additional $ 18.00. That was after five years. The rings were over $ 20,000.00. JM accepted the detailed receipt on the purchase.

 

[metsfan2016]

Re: How much do I insure my e-ring for?actual cost or apprai

If you bought at retail, the price you paid is the true replacement value. Diamonds do not necessarily go up in value every year and don't always have increases that correspond to inflation. My items bought a couple of years ago are not worth a penny more and might be less. I never insure for more than I paid, and I request that the insurance valution ("appraisal") reflect what I paid. Just be sure you include the diamond grading report and complete information such as if the stone is a branded one. I see no advantage to the insured to over insure. If the item cost $10k and is appraised at $15k, the insurance company is not going to pay $15k for the replacement. They'll replace with exactly what you had which is a $10k diamond that they can probably access for less than that. Obviously if diamond prices increase significantly, you can get a new appraisal but stress that you do not want an inflated value. You can always go on a site like James Allen and see what similar diamonds cost to get an idea.

Diamond Seeker is giving you good advice.

I have done a LOT of insurance replacement work over the years. Jewelers Mutual is a replacement policy, so the way to be sure you get what you had is to have a GREAT appraisal, not some fluff written without good documentation. If you got a branded diamond, make sure the brand is included in the appraisal documents. If your diamond was Hearts and Arrows quality, make sure that also is in the documents.

Personally, I will often write an Evaluation for Insurance Purposes with about a 10% cushion as I know that most will not follow the market and get the ring reappraised when they need to. IT IS YOUR RESPONSIBILITY to have the appraisal updated when needed though, so you should keep an eye on the market.

Frankly, for an appraisal that is 50% more than you paid for it, the appraisal should contain a statement as to why it is appraised so high. I am guessing that did not happen, but you will be able to read the appraisal and know for sure. If I buy an estate piece and sell it for a price that I can not replace it for, I always document this in the appraisal and appraise it for what it is worth to replace, if it is even possible. That way the insurance company can not holler "Calf Rope" if the piece is lost or damaged, as they already have it in writing why it is appraised for more than it sold for.

I am sure my friend Neil (Denver Appraiser) can put this in a more articulate manner, but for normal usage, you do NOT need an appraisal for 50% more than you paid. Even if you had a cash out policy, the insurance company is going to be calling people like me that do insurance replacement work and get some quotes prior to writing that check. They will NOT pay you more than they can buy it for elsewhere.

Wink

Thank you for the information. I just wanted to add that the appraisal was not for 50% more than I paid for it. It was for about $5,000 more than I paid for it.

 

[metsfan2016]

Re: How much do I insure my e-ring for?actual cost or apprai

If you bought at retail, the price you paid is the true replacement value. Diamonds do not necessarily go up in value every year and don't always have increases that correspond to inflation. My items bought a couple of years ago are not worth a penny more and might be less. I never insure for more than I paid, and I request that the insurance valution ("appraisal") reflect what I paid. Just be sure you include the diamond grading report and complete information such as if the stone is a branded one. I see no advantage to the insured to over insure. If the item cost $10k and is appraised at $15k, the insurance company is not going to pay $15k for the replacement. They'll replace with exactly what you had which is a $10k diamond that they can probably access for less than that. Obviously if diamond prices increase significantly, you can get a new appraisal but stress that you do not want an inflated value. You can always go on a site like James Allen and see what similar diamonds cost to get an idea.

This is an option I didn't think of, thank you. I'm wondering if JM will allow me to submit my appraisal but insure it, at my request, for what I actually paid. If not, I'm thinking I will contact my jeweler as you recommended.

 

[pfunk]

Re: How much do I insure my e-ring for?actual cost or apprai

Jewelers Mutual allowed me to pick an insured value somewhere between what I paid and what it was appraised for. The ring was appraised by an independent appraiser at about 40% more than what I paid, and that was after I told him I didn't want an inflated value. He explained that in the local market place, that was as low as he would go to make sure I would be covered in the event of a loss. I would be ok with shopping online again and not shopping locally, which is why I asked JM to let me choose the insured value. I chose to insure it at roughly 10% more than what I paid, because I wanted to be on the safe side in case diamond prices and inflation drove the replacement cost higher and I wasn't keeping on top of it. I provided them with my receipts showing what I actually paid along with the appraisal. I specified an insured value in between the two and they were fine with that.

 

[jsb15]

Re: How much do I insure my e-ring for?actual cost or apprai

I agree with the others who insured for no more than 10% over actual cost. Nearly all insurance companies will pay you for like kind and quality. When I lost a stone 5 years ago and my appraisal did not specify cut quality since that was not common when my first appraisal was written, I had a hassle getting a well cut stone since the insurer wanted to default to a lower quality. I replaced it with a stone that had a bullet proof description and AGS 000. The insurer could care less what my appraised amount was. Fast forward to now and I am going through this again because of a chip damage and not loss. Maybe because it is a different company but more likely because I have an ideal cut stone things are starting easier this time. I just told the appraiser what I wanted them to set the number and I did so at about 110% of what I paid figuring the added cost would pay off by reducing the need to frequently update. Of note, if you have a Cadillac plan like Chubb they will just promptly cut a cheek for the insured amount so there is no worry about the appraisal number.