What a Jewellery Appraisal Actually Is (And What It Is Not)

An appraisal describes an item and gives an opinion of value. Why that is different from a grading report, and why most appraisals are for insurance rather than resale.

Most people request an appraisal expecting to be told what their jewellery is worth. What they receive is more specific than that, and more useful once understood.

The definition

An appraisal report describes an item, assesses its relative quality, and provides an opinion of value. The description covers the visible, measurable and analysable facts, weight, materials, markings, dimensions, stone characteristics.

Note the phrase: an opinion of value. Not a price. Not a guarantee. A qualified opinion, for a stated purpose.

The purpose changes the number

This is the part that surprises people. The same ring can be appraised at very different figures depending on why the appraisal is being done.

The majority of appraisals today are for insurance replacement, retail replacement value. That is what it would cost to replace the item at retail today, which is typically the highest number.

Other purposes produce different values: estate valuation, division of assets, resale. A resale figure will be substantially lower than a retail replacement figure, and neither is wrong.

Always state the purpose when commissioning an appraisal. An insurance appraisal used to set a sale price will disappoint everyone.

Appraisal is not the same as a grading report

Clients conflate these constantly.

A grading report describes a stone, its cut, colour, clarity, carat, measurements. It is issued by a gemmological laboratory. It contains no value.

An appraisal describes the whole finished piece, including metal and workmanship, and assigns a value.

You may well need both. The report establishes what the stone is; the appraisal establishes what replacing the piece would cost.

What a good appraisal contains

• Full description of metal, weight and hallmarks
• Stone details, measurements, estimated weight, colour and clarity assessment, cut
• Any treatments identified or suspected
• Photographs
• The stated purpose and the definition of value used
• The date, and the appraiser's name and qualifications

If a document lacks the purpose and the date, it is not doing its job. Values move.

How often to update

Every two to three years for a piece of significant value, and sooner after a sharp move in metal or stone prices. Gold has moved considerably in recent years, and an appraisal from five years ago will materially understate replacement cost.

Frequently asked questions

Do I need an appraisal for insurance?

Usually yes, most insurers require one to schedule an item individually.

Is an appraisal what I can sell it for?

No. Retail replacement value is typically well above resale.

Can the shop that sold it appraise it?

They can describe it accurately. For an independent value, an independent appraiser is preferable.

How much does an appraisal cost?

Usually charged by time or per item, never as a percentage of value, a percentage fee creates an obvious conflict.

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C'Garden is an independent bespoke jeweller in Kuala Lumpur. We are not affiliated with, endorsed by, sponsored by or certified by any organisation, laboratory or brand named in this article. Third-party names are used only to refer factually to those organisations and their published standards. All text and imagery in this article is original work created by C'Garden.

Reference

Jewelers of America. (n.d.). Appraisals. Jewelers of America. https://www.jewelers.org/buying-jewelry/jewelry-repair-and-care/appraisals