5 Reasons to Have a Jewelry Appraisal for Insurance Purposes

You’d probably prefer not to think about your jewelry treasures being damaged, destroyed or lost during a catastrophe, but it’s prudent to be prepared.

Whether you’ve spent years building your fine jewelry collection or you’ve recently acquired your first exquisite piece, you should insure each item to value, just in case the unexpected happens. To do that properly, you must have your jewelry appraised for insurance purposes.

Here are 5 reasons to consider:

1. Appraisals are important to the insurance process

If you have a sentimental attachment to your most cherished jewelry pieces, you’ll love them no matter what they’re worth. Still determining a value is important, especially when you’re purchasing insurance.

• You need to know if your Homeowners Policy jewelry limit will cover them, or if you need a valuable items endorsement or a separate policy.
• If you need a special endorsement or policy, underwriters will base your coverage amount on the appraised value of your jewelry.
• Your insurance premium will be based on that same value.

2. Insurance companies never take your word for value

Even if you’ve had the same insurance agent for years, that relationship will only take you so far. Your agent might trust you when you tell him the value of your newest jewelry piece, but the insurance company underwriters will want more. Before an underwriter finalizes the jewelry schedule on your Valuable Items Policy or your Homeowners Policy jewelry floater, he will insist on a written appraisal from a reputable source.

3. A sales receipt won’t do

Insurance companies won’t accept a receipt of purchase as a legitimate measure of value. It doesn’t matter how much you paid for your jewelry. When writing a policy or paying a claim, the insurance company relies on the actual appraised value, not the cost.

4. The insurance company might require updated appraisals

Even if your insurance company doesn’t require regular appraisal updates, you might want to get them anyway.

• It’s the best way to make certain you are insuring your jewelry to its proper value.
• If the market prices of precious metals, diamonds, and fine jewels rise or fall, it could change the value of your jewelry.
• Vintage, antique, and collectible jewelry styles go in and out of favor, causing the values to go up or down.
• Values rarely remain constant, and your policies should change accordingly.

Ask your agent or underwriter about insurance policy appraisal guidelines.

5. You may still have to prove the value if a loss occurs

When you file a claim, the insurance company won’t simply write a check for the amount of your stated coverage. They will verify the details before settling your claim.

If a thief stole your jewelry, they will want to see a police report. If you lost it or it simply disappears, they will want to know how and why. If you have no witnesses, the insurance company adjuster may decide to talk to friends and relatives about you and your jewelry.

Regular appraisals can help you prove an insurance claim. An appraiser can attest to the quality, design, condition, and valuation of your jewelry. If a jewelry professional has inspected your collection a number of times over the years, the dated documentation can verify ownership and custody.