Appraisals are documents typically provided by jewelers and retail stores, detailing the components and value of a piece of jewelry. One of the main functions of an appraisal is to serve as guide for insurance companies when a client files a claim. Appraised values are meant to reflect the retail replacement value (what it would cost to buy the item at a retail store).
Often, when you buy jewelry it is accompanied by an appraisal from the place of purchase. This can create an issue because all retailers want their customers to believe they are getting a great deal. To maintain this illusion, retailers will inflate the appraised values, making it seem like the customer is paying less than they would at a typical retail outlet. But, this isn’t the only reason appraised values tend to be inflated.
Insurance companies are notorious for debating the value of items when compensating for lost or stolen jewelry pieces. To counter this, some appraisers will inflate the values. This gives clients a higher starting point when negotiating insurance compensation.
While appraised values may not mean much during the selling process, the descriptions they contain can be beneficial. Appraisals often detail a diamonds carat weight, color and clarity. While these grades are not set in stone, they should allow potential buyers to provide an estimate prior to actually inspecting the diamond.