Online Vendor Appraisals
- Thread starter kittykat
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Kitty:
Some on-line vendors do provide appraisals. I think it is more important to get an independent appraisal from a trusted third party.
In general, insurance appraisals usually range between 40-60% above the purchase price.
Regards-
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Many of the appraisals we do are higher than actual purchase price. I can't think of any that were as low as Internet retail except when we were asked to estimate the Internet level of the market. It is easy enough for us to do that, but may leave a consumer under insured because the insurance company may normally make replacements through a B&M source which charges more than INTERNET minimum pricing. The game is changing, but not every insurance company is doing their replacement work with equal efficiency.
When we make an appraisal we always discuss, or are willing to discuss, the transaction amount. We can talk about what we think someone paid or discuss what they tell us they paid. We generally don't inquire about this until AFTER we render our opinions, but really, it makes little difference since we make every effort to do a fair job for all concerned.
Don't over insure jewelry, but don't waste premiums by under insuring, either. Use the proper amount of coverage would be my advice. Some people want to impress someone with a high value, others want to minimize their coverage with a minimal value, others want to force a vendor to take a return because the stated value is too low when they asked for it to be minimal themselves. There are many reasons for proper, high or low appraised values. Anything is subject to being abused. We try to be cautious, but people can be very tricky. It isn't just jewelers who sometimes try to fool us. Consumers sometimes try to fool us too.
We don't go around paranoid or suspicious, but we seek to provide sufficient advice for people to make good decisions. We also seek to prevent misuse of our reports by clearly stating the level of the market we used to calculate the final insurance or replacement value.
There are a couple very large diamond grading labs that also supply ridiculous appraisal values. Just read, smile, and ignore these hopelessly silly sales pitches made to confuse less sophisticated shoppers. While the jewelry trade can't or won't do anything about it, you can at least know to ignore them.
When we make an appraisal we always discuss, or are willing to discuss, the transaction amount. We can talk about what we think someone paid or discuss what they tell us they paid. We generally don't inquire about this until AFTER we render our opinions, but really, it makes little difference since we make every effort to do a fair job for all concerned.
Don't over insure jewelry, but don't waste premiums by under insuring, either. Use the proper amount of coverage would be my advice. Some people want to impress someone with a high value, others want to minimize their coverage with a minimal value, others want to force a vendor to take a return because the stated value is too low when they asked for it to be minimal themselves. There are many reasons for proper, high or low appraised values. Anything is subject to being abused. We try to be cautious, but people can be very tricky. It isn't just jewelers who sometimes try to fool us. Consumers sometimes try to fool us too.
We don't go around paranoid or suspicious, but we seek to provide sufficient advice for people to make good decisions. We also seek to prevent misuse of our reports by clearly stating the level of the market we used to calculate the final insurance or replacement value.
There are a couple very large diamond grading labs that also supply ridiculous appraisal values. Just read, smile, and ignore these hopelessly silly sales pitches made to confuse less sophisticated shoppers. While the jewelry trade can't or won't do anything about it, you can at least know to ignore them.
pricescope
Ideal_Rock
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RockDoc,
Question is obviously posed to consumers.
kittykat
Shiny_Rock
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I''m not asking if I should rely on a vendor appraisal. I''m just wondering what people''s experiences of vendor appraisals are. For example, if someone bought a stone from BlueNile and they were provided an appraisal from them, did their independent appraisal exceed, fall short, or match the vendor appraisal.
aljdewey
Ideal_Rock
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Oftentimes, yes, the price is higher than the sale price for the diamond(s).
I purchased earrings and got a vendor appraisal with them.....the earrings sold for about 670 each; the appraisal stated about 900 each? Why?
Two reasons - first, it would likely cost $900 per stone if I had to replace in a retail environment and not online. Second, appraising a bit higher allows for the fact that the price of replacing the diamond will increase with inflation/price increases, and a to-the-penny-paid appraisal wouldn''t help you to replace your loss the second a price increase kicked in.
aljdewey
Ideal_Rock
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I just want to point out that Rock's point, while well-taken, is a bit vested as well.
No one disputes the value of an independent appraisal, but I think it's important to weigh that value against the purchase being considered. It makes sense to spend $150 or so to appraise/verify a $6k purchase. It makes less sense to spend $150 to appraise/verify a purchase under $1K.
Similarly, it makes more sense to get a hugely detailed appraisal on a piece I'll be extremely fussy about in the event I incur a loss and have to replace it, such as my e-ring, and less sense on a piece I'd be less fussy about (earrings.)
For us, the purchase of an e-ring stone was significant and something we wouldn't readily be able to replace at our own expense without feeling the cost. Hence, it was pretty important for us to get an independent appraisal on it.
However, when we bought the sidestones to modify e-ring into a 3-stone, the total for the 2 stones was $900. All I cared about was 1A cut stones; didn't have to have the H&A pattern on the sidestones. I was fine with the vendor's appraisal at that point because a) I could afford to absorb the loss, and b) wasn't expecting perfection according to my definition.
Everything has its purpose. Sometimes an independent appraisal is the only way to go....other times, it's overkill.....like putting $1000 high performance tires on a 10-year old, beat-up, former performance car that's only worth $900 total.
Keep in mind all, this is very important:
Insurance companies do NOT care what the cash value of the appraisal is... they will replace your stone by finding one that matches your appraisal description -- not monetary value. They have done this forever and let me just guess.. they are probably VERY good at finding a stone equal to what you paid if not slightly lower. (A few policies have a cash back option, in this case, the previous statement doesn't hold true -- very few policies though).
Logically then, one would want an appraisal to guarantee his or her replacement with another stone equal to what they had. If the insurance doesn't use the price value, then what do you have to replace the stone with? The DESCRIPTION. If you get an in store appraisal from where you bought the stone, make sure they include nitty-gritty details... otherwise you are shorting yourself. Just because its value is appraised higher than say, an independent appraiser, doesn't mean it will be detailed enough.
Case 1: Independent appraiser values my stone at $5000 dollars (I paid $3000)... and describe the standards.. but goes above and beyond by giving light scopes, angles and Sarin info, cut quality info, etc... so that my replacement should I need it, will match perfectly. Insurance = 50/year.
Case 2: The place where I bought the stone gives me an appraisal for $6000 (I paid $3000).. and they describe the standards -- color, shape of cut, clarity, polish, symmetry, maybe a few other things. Light interaction within the diamond is not documented, cut quality is not quantified and documented to the best of their ability. Insurance = 65 / yr.
Case 3: The place where I buy my diamond gives me an appraisal, and is as detailed as Case #1. Appraisal is for $6000 and I paid $3000. Insurance = 65 / yr.
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Which case wins in the event of a lost stone? Well, the insurance company would have to look good and hard to find a stone to match Case 1... they would NOT have such stringent requirements for Case 2 (meaning their "cost" of the replacement would be lower most likely) and Case 3 would equal Cast 1 except you have paid for $1000 more in insurance to do so. Why? Who knows.
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My opinion personally, I would get an independent appraisal for any center stone, and any band / setting that has significant carat weight. If you have a 0.50 carat wedding band channel set something, and your solitaire engagement ring is the other band.. maybe neither of those needs to go through independently, but any thing of considerable value, that I would want an EXACT replacement for, and not something close or even worse, distant... I would have independently appraised; no questions asked.
Insurance companies do NOT care what the cash value of the appraisal is... they will replace your stone by finding one that matches your appraisal description -- not monetary value. They have done this forever and let me just guess.. they are probably VERY good at finding a stone equal to what you paid if not slightly lower. (A few policies have a cash back option, in this case, the previous statement doesn't hold true -- very few policies though).
Logically then, one would want an appraisal to guarantee his or her replacement with another stone equal to what they had. If the insurance doesn't use the price value, then what do you have to replace the stone with? The DESCRIPTION. If you get an in store appraisal from where you bought the stone, make sure they include nitty-gritty details... otherwise you are shorting yourself. Just because its value is appraised higher than say, an independent appraiser, doesn't mean it will be detailed enough.
Case 1: Independent appraiser values my stone at $5000 dollars (I paid $3000)... and describe the standards.. but goes above and beyond by giving light scopes, angles and Sarin info, cut quality info, etc... so that my replacement should I need it, will match perfectly. Insurance = 50/year.
Case 2: The place where I bought the stone gives me an appraisal for $6000 (I paid $3000).. and they describe the standards -- color, shape of cut, clarity, polish, symmetry, maybe a few other things. Light interaction within the diamond is not documented, cut quality is not quantified and documented to the best of their ability. Insurance = 65 / yr.
Case 3: The place where I buy my diamond gives me an appraisal, and is as detailed as Case #1. Appraisal is for $6000 and I paid $3000. Insurance = 65 / yr.
----------------
Which case wins in the event of a lost stone? Well, the insurance company would have to look good and hard to find a stone to match Case 1... they would NOT have such stringent requirements for Case 2 (meaning their "cost" of the replacement would be lower most likely) and Case 3 would equal Cast 1 except you have paid for $1000 more in insurance to do so. Why? Who knows.
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My opinion personally, I would get an independent appraisal for any center stone, and any band / setting that has significant carat weight. If you have a 0.50 carat wedding band channel set something, and your solitaire engagement ring is the other band.. maybe neither of those needs to go through independently, but any thing of considerable value, that I would want an EXACT replacement for, and not something close or even worse, distant... I would have independently appraised; no questions asked.
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AljDate: 8/12/2005 5:58:23 PM
Author: aljdewey
Everything has its purpose. Sometimes an independent appraisal is the only way to go....other times, it''s overkill.....like putting $1000 high performance tires on a 10-year old, beat-up, former performance car that''s only worth $900 total.
strmrdr
Super_Ideal_Rock
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Date: 8/12/2005 5:58:23 PM
Author: aljdewey
I just want to point out that Rock''s point, while well-taken, is a bit vested as well.
No one disputes the value of an independent appraisal, but I think it''s important to weigh that value against the purchase being considered. It makes sense to spend $150 or so to appraise/verify a $6k purchase. It makes less sense to spend $150 to appraise/verify a purchase under $1K.
Similarly, it makes more sense to get a hugely detailed appraisal on a piece I''ll be extremely fussy about in the event I incur a loss and have to replace it, such as my e-ring, and less sense on a piece I''d be less fussy about (earrings.)
For us, the purchase of an e-ring stone was significant and something we wouldn''t readily be able to replace at our own expense without feeling the cost. Hence, it was pretty important for us to get an independent appraisal on it.
However, when we bought the sidestones to modify e-ring into a 3-stone, the total for the 2 stones was $900. All I cared about was 1A cut stones; didn''t have to have the H&A pattern on the sidestones. I was fine with the vendor''s appraisal at that point because a) I could afford to absorb the loss, and b) wasn''t expecting perfection according to my definition.
Everything has its purpose. Sometimes an independent appraisal is the only way to go....other times, it''s overkill.....like putting $1000 high performance tires on a 10-year old, beat-up, former performance car that''s only worth $900 total.
Well said.
May I have the wrong mindset here.
Alj for side stones, I absolutely agree with taking the position that paying for an independent appraisal doesn''t make common sense.
But for me, if a person is only spending $ 1500.00 for an engagement ring, that $ 1500.00 for him is just as important as someone with a $ 15000.00 budget.
For the guys that spend like Trump does, if they make a mistake, they just buy another one. That doesn''t mean that I would take less care of the person spending a significant amount, but I value and respect any consumers budget as being important to them. So, I don''t do less because of the amount someone decides to spend.
I sort of heitate to write this as some will see it as self promotion, but it sincerely isn''t meant to be that way. I am just explaining my position with these issues and why I take the approach to this that I do
Rockdoc
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Alj for side stones, I absolutely agree with taking the position that paying for an independent appraisal doesn''t make common sense.
But for me, if a person is only spending $ 1500.00 for an engagement ring, that $ 1500.00 for him is just as important as someone with a $ 15000.00 budget.
For the guys that spend like Trump does, if they make a mistake, they just buy another one. That doesn''t mean that I would take less care of the person spending a significant amount, but I value and respect any consumers budget as being important to them. So, I don''t do less because of the amount someone decides to spend.
I sort of heitate to write this as some will see it as self promotion, but it sincerely isn''t meant to be that way. I am just explaining my position with these issues and why I take the approach to this that I do
Rockdoc
.
aljdewey
Ideal_Rock
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Honestly, Rock, I think an engagement ring is an important purchase period.......so you''re right, it doesn''t matter how much is spent on that purchase.
What I''m talking about is the cost of the appraisal RELATIVE to the cost of the stone. On a $1500 stone, that $150 for an appraisal is a full 10% of the stone cost.......and only 1% of the cost for the $15000 stone. Someone who can afford a $15000 stone is likely readily able to afford the $150 without a problem, and the RELATIVE cost of the appraisal is nominal compared to the purchase.
With the $1500 stone, it could go the other way in two scenarios. If it''s someone scraping together $1500 for a stone, that 10% more to scrape another $150 might just be too much. If it''s a person who could readily afford more but chooses a simple, modest stone, that person is likely in the position to replace it without a huge worry.....self-insure, so to speak.
Again, I understand the value of diagnostic tools, but it''s important to look at their relative benefit. I think CT scans and MRIs are wonderful medical tools in evaluating the damage caused by heart attacks, strokes, cancer, etc., but I certainly wouldn''t want to use those to evaluate a hangnail.
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