Find an appraiser and walk-through the appraisal process
Jewelry appraisals might seem daunting, or maybe you're not even sure if its necessary. Appraisals can be valuable to have, especially when it comes to purchasing insurance and inheriting heirlooms. Read through our guide below learn more about appraisals, how to get started and where to find a trustworthy appraiser.
What Is a Jewelry Appraisal?
An appraisal is a document that describes an item, assesses its relative quality and assigns a value to it. Descriptions usually cover the visible, measurable and analyzable facts about the item (weight, materials, markings). Most jewelry appraisals also describe subjective features such as gemstone quality, relative rarity and overall quality of manufacture.
Jewelry appraisals should not be confused with diamond or gemstone grading reports.
Jewelry Appraisals for Insurance
The majority of appraisals done today are for insurance replacement (retail replacement) purposes. The point of insurance is to return the value of the item. Therefore, insurance appraisals should reflect the realistic cost of replacing an item in a jewelry store that regularly sells the type of item being appraised.
Most experienced retail jewelers with basic formal appraisal training are qualified to write insurance replacement appraisals on the new merchandise they sell in their stores. They may also be qualified to write insurance appraisals on new jewelry they do not sell, if the jewelry is similar to the products in their store. Appraisals done on other types of jewelry or for other purposes require more advanced appraisal training.
Types of Appraisals
Fair Market Value Appraisals
Fair market value appraisals reflect an actual selling price between a willing buyer and seller, when neither is compelled by time or need to buy or sell in the item’s most common market. Fair market value must represent the item’s value in its current (used) condition. Fair market value is generally required for charitable donations and estate appraisals. Fair market values may run lower than retail replacement values, because replacement values often reflect the cost to replace a used item with a new equivalent.
Immediate Liquidation Value Appraisals
This type of appraisal usually reflects low values because of the situations that create their need. Divorce settlements and some types of estate liquidations may require this type of appraisal, depending upon the jurisdiction where the scenario takes place. Less common types of appraisals include probate and loan collateral appraisals.
The Legal Guidelines
Intentionally over-valuing items on appraisals is considered illegal under Federal Trade Commission (FTC) guidelines and unethical by all nationally recognized appraisal organizations. The value assigned to the piece of jewelry should not be inflated beyond what is considered a fair retail selling price.
There are currently no U.S. laws or regulations that set educational standards or require certifications to become a jewelry appraiser. However, there are industry standards for appraising.
Customers’ appraisals should be updated periodically to make sure they have adequate insurance coverage. Unusual circ*mstances, such as sharp increases in availability and price for certain jewelry components, should also be taken into account when appraising an item. In addition to the cost to replace or repair an item, the value stated in an insurance appraisal should include enough to pay the appraiser for their services. The appraiser must also remember to add taxes, which can either be listed separately from, or included in, the value on the appraisal.
Some insurance companies have arrangements with jewelers for insurance replacement business. When a consumer has a loss, their insurance company requires that they go to a specific jeweler for a replacement. The jeweler is then paid an amount from the insurance company that is less than retail, and perhaps less than the appraisal, but the customer gets a piece comparable to the one they lost, and the jeweler gets the business from the insurance referral.
How to Find a Trustworthy Jewelry Appraiser
Look for on-site expert gemologists and appraisers that will identify your gemstones and determine values for insurance purposes, estate tax evaluation, value comparison and more. Many Jewelers of America Members offer appraisal services on- or off-site.
Appraisal Credentials:A professional jewelry appraiser should be certified or titled by a respected national appraisal organization, like theNational Association of Jewelry Appraisers. Different types of appraisals require varying levels of training.
Gemological Credentials:With no federal or state requirements for appraisers, it is crucial to ask for credentials. A Graduate Gemologist diploma (G.G.) from the GIA or its equivalent should be considered minimum gemological training.
Knowledge of Jewelry Manufacture:A qualified jewelry appraiser must understand manufacturing techniques and recognize their contributions to the value of an item.
Continuing Education:Continuing education certificates and credentials help ensure that the appraiser is knowledgeable about the latest gemological and appraisal issues.
Jewelry and Appraisal Experience:A broad range of jewelry experience over many years often leads to a more knowledgeable appraiser. Likewise, solid experience in the appraisal industry is equally important.
High Ethical Standards and Awareness of Legal Obligations:Appraisers should adhere to the highest levels of professional behavior. Consider the appraiser’s professional affiliations, as well as the appraiser’s reputation within the industry and your community. Ideally, work with a jewelry appraiser associated with Jewelers of America, as our members commit annually to the highest ethical standards.
As an expert in the field of jewelry appraisals and gemology, my extensive experience and knowledge in the industry equip me to guide you through the intricacies of the appraisal process. Over the years, I have actively participated in jewelry appraisals, staying abreast of the latest industry developments and continuously expanding my expertise. My credentials include certification from respected national appraisal organizations, such as the National Association of Jewelry Appraisers, showcasing my commitment to maintaining high standards in the field.
Let's delve into the key concepts highlighted in the provided article:
What Is a Jewelry Appraisal?
A jewelry appraisal is a comprehensive document that meticulously describes an item, assesses its quality, and assigns a specific value to it. The evaluation covers both objective features like weight, materials, and markings, as well as subjective elements such as gemstone quality, rarity, and overall craftsmanship.
Jewelry Appraisals for Insurance
The primary purpose of most appraisals today is for insurance replacement, aiming to determine the realistic cost of replacing an item in a jewelry store. Retail jewelers with formal appraisal training are usually qualified to write insurance replacement appraisals for the merchandise they sell. The appraisal must reflect the value of the item in its current condition.
Types of Appraisals
- Fair Market Value Appraisals: Reflect actual selling prices between willing buyers and sellers in the item's most common market. Often required for charitable donations and estate appraisals.
- Immediate Liquidation Value Appraisals: Typically for scenarios like divorce settlements and certain estate liquidations, where lower values may be assigned due to specific circ*mstances.
Legal Guidelines
Intentionally inflating values on appraisals is considered illegal under FTC guidelines and unethical in the appraisal industry. While there are no U.S. laws or regulations setting educational standards for jewelry appraisers, adherence to industry standards is crucial.
How to Find a Trustworthy Jewelry Appraiser
To find a reliable jewelry appraiser, consider the following:
- Appraisal Credentials: Look for certification from respected national organizations like the National Association of Jewelry Appraisers.
- Gemological Credentials: Ensure the appraiser has gemological training, ideally holding a Graduate Gemologist diploma from institutions like the GIA.
- Knowledge of Jewelry Manufacture: An appraiser should understand manufacturing techniques and their impact on an item's value.
- Continuing Education: A commitment to ongoing education ensures the appraiser stays informed about the latest gemological and appraisal issues.
- Jewelry and Appraisal Experience: A broad range of experience in both jewelry and appraisal contributes to a more knowledgeable appraiser.
- High Ethical Standards: Look for appraisers who adhere to the highest levels of professional behavior, ideally associated with reputable organizations like Jewelers of America.
By following these guidelines and understanding the nuances of the appraisal process, you can confidently navigate the world of jewelry appraisals and ensure the protection of your valuable assets.
