What Dollar Value For Appraisal?

[Sparkle524]

So I had my loose stone appraised and it will be sent off to VC to have a setting made. VC asked me what value should he put on the invoice and I said that I wasn't exactly sure because the appraiser and I didn't exactly choose what percentage we should use. The appraisal is incomplete as we are waiting for the completed ring. The original price of the diamond is $67024 and VC suggested putting $79K on the invoice so that I can get it insured with JM. Do you think that's too much? It's about 18%. I really don't want to pay the insurance company more than I have to. Thanks.

 

[diamondseeker2006]

You can replace the diamond for approximately what you paid because you paid a retail price. I would insure the diamond for no more than $70,000, and I would try to get a policy from Chubb instead of JM. Chubb writes you a check in the case of loss. So much easier to deal with. They prefer to insure higher value items, you just have to find an agent who writes stand alone policies. Chubb also gives me the option each year to increase the value of my items by 10% (or more) without an additional appraisal, so if I see diamond prices rising, I can very easily adjust the value upward.

 

[denverappraiser]

Have your appraiser write a report about the diamond. The insurance issue isn't just about the value conclusion, it's about how they will handle the replacement with like kind and quality in the case of a problem. The report, submitted to the insurance company, becomes the definition of 'like kind and quality'. Yes, you'll probably be paying a bit extra for 2 reports but if your shopping included ANYTHING beyond what's on the lab report you benefit by including it in what you submit to the insurance company.

Talk with your appraiser about the value conclusion question but in this situation I generally use the transaction price, but it doesn't matter as much as you think. +/- $5k affects your premium by about $100/year. If it takes VC a month to do the job and then you 'update' the appraisal to reflect the finished piece, this means that the policy you're considering will only be in force for about a month before it's converted into a different policy (possibly even at a different company) that covers the finished item. That means we're talking about $10 issue on a $70,000 purchase.

As far as I know, Chubb won't write a policy on an unmounted diamond and if you live in the wrong neighborhood they might not write you a policy at all. Premiums vary drastically depending on the details of your own policy. That said, I agree with DiamondSeeker that they're a wonderful company and that they treat their clients well.

 

[diamondseeker2006]

Oh, yes, that is true that Chubb will insure the completed ring, so you might have to do JM at least temporarily. Thank you, Neil!

 

[Sparkle524]

Thank you Neil and Diamondseeker!

Diamondseeker - I'm a little confused on the part where you said that I paid retail price on my diamond. I thought that I paid internet prices? Wouldn't my diamond in the retail setting cost more than what I paid?

 

[diamondseeker2006]

You paid retail but it was on the low end because you bought through an internet vendor. If you had to replace the stone someday, wouldn't you go back through WF or GOG, etc. to replace the stone? I don't think you'd go to Tiffany or another high end jeweler to do it, so you really don't need to pad your value. This is why Chubb is best over the long haul because they will cut you a check and you can shop around for a new diamond just like you did this time. And they allow you to increase the value without extra appraisals if you check value of similar stones and see them going up.

 

[Sparkle524]

Thank you Diamondseeker. You are a wealth of knowledge!! When I think of retail I think of Jared's, etc but I get what you mean. I just wired my money and am one step closer to getting my ring! I'm soooo excited! Thank you for all of your help as well as other PSers like Gypsy and Ariel to name a few. I will post a pic of the ring when it's completed. Now I'm on the Victor Canera diet since I am having him make it in a size 5. Yikes. Nothing but water and crackers for me

 

[yssie]

Just FYI DS JM will also let you choose your vendor. Depending on where you live they can get pricey... but I guess that's true of any insurer. There are big premium jumps at some dollar values, so try JM's free "sample quote" facility and see if maybe you can get right under one

Chubb does sound like less hassle if you can get a policy! Something tells me that at 70-80k that probably won't be too much of a problem

 

[denverappraiser]

The JM rules are a bit opaque. Basically the deal is that they REQUIRE you to do a replacement, rather than buying a new boat or whatever, but will allow you to replace at any jeweler you wish. That’s got a qualifier as well. They have rules to decide if you’re chosen jeweler is charging reasonable prices based on the description and what they think the jeweler’s cost should be. They don’t just offer the jeweler a blank check. You can still replace at the most expensive outfit you can find or with a jeweler who doesn’t know where to get the good deals but you may need to throw in some money unless you can justify this decision (like that’s where you bought it). If you bought it online but want to replace at the airport giftshop, expect a fight. All that said, their rules are actually pretty reasonable when you get into them. They pay the jeweler on a cost+ basis where the ‘+’ part is lower on the more expensive things and where the ‘cost’ part is using the usual sorts of suppliers used by most jewelers.

At least around here (Denver suburbs), the quoted Chubb rates are more than double what JM is quoting for the same policy limits. Whether or not their Cadillac service and claims system is worth the price is up to you but, personally, I’ve been a loyal JM client for decades both in terms of my personal jewelry and in the professional coverage for my business. I’ve never filed a personal claim but have had many clients who have and mostly they’ve been treated pretty well although it’s definitely not as painless as the Chubb approach.

Rates, terms and availabillity for the various companies vary a LOT from one market to the next. It pays to shop. Suburban Denver is kind of a low risk place but I"m told by friends in higher risk places like Manhattan Island or Detroit, that the Chubb rates are more price competitive.

 

[Sparkle524]

Thank you for the informative posts. I did the free quote on line with JM and for $70K with a $1000 deductible it's approx $1300/yr!! Goodness. Well I guess piece of mind costs money!

 

[diamondseeker2006]

Check with Chubb to compare rates. Lucky for me, Chubb is not higher here. I pay about $325 for $30,000 of coverage. I think out of curiosity, I am going to try the JM online rates just so I can see if it is less or more.

Ha! Pays to compare:

Chubb $328

Jeweler's Mutual $379

 

[Sparkle524]

Check with Chubb to compare rates. Lucky for me, Chubb is not higher here. I pay about $325 for $30,000 of coverage. I think out of curiosity, I am going to try the JM online rates just so I can see if it is less or more.

Ha! Pays to compare:

Chubb $328

Jeweler's Mutual $379

I think I have to stick with JM until the diamond is set then I will check with Chubb. Lower premiums makes me happy

 

[diamondseeker2006]

Me, too! But I think it depends on the crime rate (or other factors) where you live. Oddly, my whole state was classified the same whereas some metro areas in certain states had different rates than other parts of their state.

 

[Sparkle524]

Me, too! But I think it depends on the crime rate (or other factors) where you live. Oddly, my whole state was classified the same whereas some metro areas in certain states had different rates than other parts of their state.

Where do you find this info? I would love to know the crime rate for my area.

 

[diamondseeker2006]

Oh, I have no idea. I just know in general insurance companies assess risk based on location...just like car insurance may be higher in areas that have major traffic, lots of accidents, etc. compared to a more rural area.

 

[Sparkle524]

Oh, I have no idea. I just know in general insurance companies assess risk based on location...just like car insurance may be higher in areas that have major traffic, lots of accidents, etc. compared to a more rural area.

Thank you. I will wait to see what JM ranks my neighborhood