All Jewelry Appraisals Are Not Alike (FAQs)

Aren't all jewelry appraisals just a matter of opinion?

An appraisal is an informed, objective opinion of value. For many years there has been a distrust of jewelry appraising. This is because, historically, it occupied a position little higher than free coffee and gift-wrapping in a jewelry store's array of amenities. This began to change around 1980, when the investment craze (remember buy-low-appraise-high charitable contributions?) led to various scams using inflated appraisal values and then a slew of court decisions. Jewelry has subjective value to the owner, so people tend to think it can't be valued objectively. For many years, it wasn't. A jeweler would simply calculate his or her price to sell an item or take a wild guess if he or she never sold it before, maybe add in a "feel-good" factor to please the owner, and call the result a value. Jewelry appraising has come a long way since then. Most jewelry stores have quit doing it, recognizing that there is real legal liability in failing to practice the methodologies and ethics of valuation science.

So how do you determine how much something is worth?

The values in my appraisals are ultimately based on sales data for items that are similar to yours. I find this information in several ways. Sometimes it is directly, from my clients' sales receipts and oral statements; often, it is by monitoring retail asking prices in print advertisements and online; or by researching sales results at national and regional auction houses. Although I consider the pricing patterns I see in my own work as a liquidator of estate jewelry and a seller of new jewelry, I do not assume they apply to all kinds of items in all appraisal situations. The most important thing is to make clear to someone relying on an appraisal how "value" was determined. For, instance, it's often easier to research an item's current wholesale market value than to document accomplished retail sales (especially for diamonds, because of the existence of an accepted grading standard and trade data bases) and apply a typical retail store markup. The same approach may be used for many colored gemstones and items of finished jewelry, where talking to dealers who buy and sell is absolutely essential.

How should I shop for a jewelry appraiser?

Credentials count when you're choosing a jewelry appraiser. Providing professional appraisal services requires learning valuation principles, both the methods and the ethics that make it a profession, and it takes ongoing effort to keep up with gem and jewelry markets. One must study appraising and become a connoisseur in a specialty to be a professional. The best groups do this through university- and trade-level education and the requirement for ongoing education (including regular re-certification) to earn and keep their membership titles.The only groups that currently do both of these things in the gems and jewelry field are the American Gem Society, the American Society of Appraisers, the International Society of Appraisers, and the National Association of Jewelry Appraisers.

What do you do that not all jewelry appraisers are educated to do?

Value is always value in a certain place, at a certain time, to particular buyers and sellers. So the first question a good appraiser asks you is, "Why do you need a jewelry appraisal?" Is it to insure what you just bought, or to find out if you got a good deal, or to sell the item? Or is it to fairly divide jewelry among heirs? Or pay federal estate tax? Does the situation involve divorce or other kinds of litigation? Then there are the many possible needs that businesses, charitable groups, law firms, banks and governmental entities can have for jewelry appraisals. In each of these categories, my job is to consider who the usual buyers and sellers are, given the specific situation and any applicable legal definitions of value, for the jewelry under appraisal. That establishes the right market to research. That's the first job.

After that, some of the nuts and bolts run like this: clean the jewelry, inspect for condition and advise of any deficiencies, identify materials, measure gemstone dimensions and estimate weights, grade them using published quality scales; determine if any gemstone treatments are present and, if so, how they affect value, and diagram clarity characteristics for diamonds weighing 0.50 carat or more. Then, measure the dimensions of the jewelry, specify how they were made (e.g., cast, die-struck or hand-made), research trademarks, examine items for age and style that would contribute to value (such as Victorian or Art Deco); photograph the jewelry; and finally, write a cover letter that summarizes the whole process, including the context of the value, such as independent retail store, on-line diamond seller, national retail chain, second-hand retail ("antique") store, auction; and mentions what efforts were made to find out information on which the value conclusion is based and the degree to which it can relied upon.

Doing these things means that my appraisals meet the standards of the Gems and Jewelry discipline of the American Society of Appraisers and conform to the Uniform Standards of Professional Appraisal Practice (USPAP).

Are there any other aspects to your work that I won't find elsewhere?

My approach is highly personalized. Sometimes, in finding out why you want a jewelry item appraised, I discover you don't need to pay for an appraisal. You might obtain adequate sales information from a seller to insure an item. You might have items that are already covered under a general homeowners' policy. You might be thinking of selling an item. We might turn to consultation, instead of appraisal, or I might recommend that you look for actual buyers. If you decide to insure your jewelry, you should learn the policy's terms of settlement in case of loss. As I hope you begin to see, the most important thing I do at the very first, before I charge anything, is to find out what your situation is and guide you to the next step that's right for you.

What do you charge for appraisals? How long does it take?

My minimum charges are $90 for the first item, $70 for the second, and $50 for each additional item. At least one image per item is required, at $15 per shot, as is a plot diagrams of any diamond estimated to weigh 0.50 carat or more, at $45.

Because appraisals are tailored to each situation, costs can vary according to the time it takes to do a competent, credible job. Some of these factors are: complexity or simplicity of the item itself, its rarity, the number of items, the nature of the assignment (for instance, litigation and tax liability assignments are generally more time-consuming than insurance coverage), and rush assignments or those done outside my office.

I can appraise your jewelry, usually single items, while you watch. When there are several items, clients usually choose to leave them for a week or less. I take whatever time is necessary to show you identifying characteristics about your jewelry under the microscope and give you the opportunity to view them again when you pick them up.

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The Truth about Jewelry Insurance Appraisals

Nobody loves them. Insured individuals get them when they change insurance companies, only because they have to. Insurers generally don't trust them, because there are no mandatory standards and anyone, qualified or not, can produce them. Jewelry is easily lost or stolen, so settling claims based on these appraisals are often up to adjusters working with vague or incorrect information about quality and/or value. This, in turn, can increase the potential for fraudulent claims.

As is true with other forms of insurance, if nothing bad ever happens, the expense of an appraisal may seem needless. Still, the need for them exists. You should know that the most important thing about a jewelry insurance is the description and a good photograph. When there's a claim, the insurance company and the policy holder need a thorough, accurate idea of what was insured in order to make a settlement according to the terms of the coverage. 

The value does two things. It sets the premiums for the policy holder and the limit of the insurance company's liability. Based on actuarial tables, it is used to determine a loss ratio and therefore the cost to insure the item. The Retail Replacement Value of an item needs to be valid for the most common market for the kind of item it is. More than this amount, and you pay too much in premiums. Less, and you may be unable to replace a lost or stolen.

You may decide to shop for the cheapest jewelry appraisal, but remember that, when the moment comes to depend on it, the cheapest isn't always the least expensive.