Protecting Your Investment: How to Get Your Jewelry Appraised and Insured for Peace of Mind
Jewelry is so much more than material pieces you own. Your jewelry collection is filled with family heirlooms, sentimental treasures, one-of-a-kind pieces, and expensive gems. Without question, jewelry is a significant investment; but because it holds such a special place in our hearts, it transcends material value.
The necessity to protect such precious treasures — whether new or old — is paramount.
Read why getting a jewelry appraisal and insuring jewelry can provide unrivaled peace-of-mind by safeguarding your monetary investment and cherished jewels.
What Is a Jewelry Appraisal?
A jewelry appraisal is a process where a certified professional examines and states how much your jewelry is worth. Jewelry appraisal documentation will show a dollar-value for the jewelry pieces that were appraised.
A jewelry appraisal is different from a diamond grading report, or a diamond certificate. A diamond grading report is created at a lab and it usually lists the specs of the diamond — the color, cut, carat and clarity. However, this report doesn’t provide a value.
A jewelry appraisal evaluates the entire piece of jewelry and provides a value. Appraisers look at the metals (such as silver, gold, steel), the piece design, and all of the diamonds or gemstones used to make the piece of jewelry.
The Why & When of Jewelry Appraisal
It’s very common to think you don’t need a jewelry appraisal — especially if you bought the jewelry yourself and still have the receipt to show the cost. But getting your jewelry appraised to determine the value can be important for several reasons:
- First, it should be noted that the appraised value of jewelry differs from the retail value. I’ll touch on this in the section below, The Difference Between Jewelry Appraisal Value & Resale Value.
- If you have recently purchased or been gifted new jewelry, an appraisal proves that you own the jewelry, in the event that it’s stolen and then later recovered.
- If you intend to sell your jewelry, an appraisal can show buyers an official value.
- If you want to get your jewelry insured, an appraisal is often the first step in obtaining insurance.
Getting your jewelry appraised now provides essential proof of ownership and value in case the unexpected happens. After the initial appraisal, it should be updated every few years for an up-to-date value to ensure you’re fully covered as costs of precious metals, diamonds, and gemstones fluctuate. Most experts in the industry recommend having jewelry appraised every two to three years — five years max. Your insurance company may require an appraisal at regular increments to retain coverage, which can vary by policy.
Types of Jewelry Appraisals
There are two main types of appraisals to know about:
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Retail Replacement Value
The retail replacement value is the most common type of appraisal.
This type of appraisal gives a value of what it would cost to replace the jewelry if something happened to it. It’s intended to cover the total price of the jewelry in case of a loss for a five-year timespan.
Due to factors like insurance premiums, market inflation, and other factors, the retail replacement value will be higher than the resale value of the jewelry.
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Fair Market Value
If you’re looking to sell your jewelry, the fair market value appraisal is an estimate of what you would receive if you sold your jewelry. This is best for someone who wishes to sell an item to a buyer who is outside the jewelry industry, or what is called a “willing buyer” — like a friend, relative, or someone you know personally, or if you’re using a third party like Facebook Marketplace or eBay.
Both types of appraisals give the same detailed specifications of the jewelry items being appraised.
The Difference Between Jewelry Appraisal Value & Resale Value
The resale value is typically lower than the retail replacement value. Why? Because the retail replacement value is assigned through the appraisal with the purpose of replacing the jewelry with another one of similar style and quality, not to sell preowned jewelry. The resale value is affected by the current economic value of the item and other market conditions.
The appraised value could be seen as the maximum worth of the item, which is why it’s required by insurance companies to get your jewelry insured.
How an Appraisal Works & Who Should Do the Appraisal?
The jewelry appraisal process includes:
- Examining the piece of jewelry
- Researching the current market value of similar pieces
- Determining authenticity of the piece of jewelry
- Writing up the official appraisal document
The purpose of the appraisal should be specified in the document because this affects whether you’re receiving the cash value, replacement value, or agreed value of the jewelry.
When a piece of jewelry is being examined, the appraiser takes into consideration the weight, a measurement of each component, color grade (if it’s a gemstone), relative rarity, markings, materials, and other factors.
As noted above, a jewelry appraisal is different from a diamond grading report. Diamond grading is in its own class of jewelry evaluation. Diamond grading should factor in the “four Cs:” cut, color, clarity, and carat, which was developed by the GIA (Gemological Institute of America).
When it comes to who should do the appraisal, you should look for an appraiser that has a Graduate Gemologist (GG) title from the Gemological Institute of America. Here are some other important factors to consider when deciding who to trust for appraisals:
- Don’t assume that the jeweler or vendor who sold you your piece is qualified or capable of conducting an accurate identification and appraisal.
- There are no regulations governing who can conduct appraisals, so it’s vital that you do your homework and ask prospective appraisers for references and credentials — such as what professional gemological or appraisal organizations they are members of.
- It’s widely recommended to get an appraisal from an independent certified gemologist or lab and never accept an appraisal from anyone who has an interest in buying your piece. This is a conflict of interest for the appraiser and may result in an inflated value on the appraisal.
The National Association of Jewelry Appraisers and the American Society of Appraisers are two reputable organizations that list appraisers on their websites so you can browse through.
How Much Does a Jewelry Appraisal Cost?
Cost of jewelry appraisals will vary depending on the appraiser’s rate. Appraisal rates are generally billed by the hour or a flat fee. A flat fee may start at $100 per piece, and an hourly rate might range between $100 and $250 per hour. Updated appraisals are often performed at a reduced rate compared to the original appraisal since they won’t need to do the full evaluation.
With an experienced appraiser — one with additional certifications beyond the Graduate Gemologist — you might expect to pay more. Additionally, if your piece of jewelry is large or complex, it will require more time to investigate. This can increase the cost, too.
It’s important to note that appraisal fees should never be based on a percentage of the value of the piece. Charging for an appraisal in this way is considered unethical because of the potential impulse to inflate the value to receive a higher fee.
Insurance on Jewelry: Why & How to Insure Jewelry
Is jewelry insurance worth it? Whether your jewelry is new or old, you’ll want to get it insured if it’s significant to you in any way, or would be costly to replace.
- In general, jewelry insurance covers the piece in the event of loss, theft, or disappearance. Insurance agencies almost always require an appraisal of the jewelry before insuring it.
- They typically work with their own jewelry services to determine policy plans, in addition to the appraised value you provide from a professional appraiser.
- In the event of a claim, the insurance company may require you to use their jewelry services to repair or replace an item.
How Does Jewelry Insurance Work?
There are a few different ways you can insure your jewelry:
A homeowners or renters insurance policy usually covers jewelry repairs or replacements that fall under what’s covered by the plan, such as theft. But this insurance is typically limited, and up to a certain dollar amount. Beyond that limit, you’ll need to get a separate insurance rider (or add-on policy).
Unfortunately, sometimes jewelry isn’t covered at all by homeowners or renters insurance unless requested. If you do request it, your premium may be adjusted when it’s added. The good news is that many insurance providers offer discounts to those who purchase more than one policy.
So, if you have your homeowners insurance, auto insurance, etc., under the same provider, talk to your agent to find out if insuring your jewelry through them is a cost-effective and viable option for you.
If you know your piece exceeds the homeowners insurance limit, or you want to avoid your premium going up, you will want to consider a stand-alone jewelry insurance policy. This type of insurance is purchased from a company that specifically focuses on insuring jewelry.
A floater is able to cover jewelry that exceeds the limits of your homeowners policy without needing to purchase stand-alone insurance. A floater itemizes each jewelry piece and specifies what will not be covered, such as loss by flood.
A floater traditionally covers the item in the event of theft, accidental loss, or disappearance. A stand-alone jewelry policy will cover these events as well but can go further to also cover incidents like a chip in a stone.
How Much is Jewelry Insurance?
Jewelry insurance costs depend on where you live, but in general, jewelry insurance will cost 1-2% of the value of your jewelry.
For example, a piece with an appraised value of:
- $1,000 will likely cost between $10 and $20 a year
- $10,000 will likely cost between $100 and $200 a year
What’s Next After an Appraisal & Insurance?
After your jewelry has been appraised and you have an insurance policy in place, be sure to keep all receipts, the appraisal paperwork, and photos of the item in a safe place. And check your insurance policies to ensure you're getting appraisals at the required intervals.
Once everything is in order, wear your jewelry with confidence! Jewelry is meant to be worn and enjoyed, and you completed all the right steps to secure your beautiful jewelry.
When you’re ready to add a new, one-of-a-kind piece of jewelry to your collection, be sure to check out all our unique modern glam jewelry designs.