Types of Appraisals

There are many reasons why someone might need an appraisal. These include insurance documents, point of sale documents, donation appraisals, and estate appraisals. These all serve different functions, so be sure to request the proper documentation for the specific job. Since the most common type of appraisal is done to obtain or renew insurance, this type of appraisal will be discussed here. Later in this text, donation and estate appraising will be covered.

An insurance appraisal is done so the client can obtain specific scheduled insurance on an item. The most common insurance appraisal is a replacement type policy. Basically, this policy protects for most perils and allows for the item to be replaced with a similar item of jewelry. Another type of coverage is the agreed value policy where the settlement is for cash and not for replacement of the jewelry. Generally, these policies would carry a higher premium. All insurance matters should be discussed with your agent to determine what coverage will best serve your particular needs.

An insurance appraisal is required when an item of jewelry is to be scheduled separately on an insurance policy. Standard coverage might include some aggregate allowance for jewelry. However, these limits are generally low and may not cover all perils. A separate insurance rider on any single item of jewelry will generally cover perils including theft, loss, mysterious disappearance, fire, etc. You should refer to the actual policy for explanation of coverage.

A point of sale document is similar to an insurance document in that a retail value is provided so that the client can purchase insurance. However, this document may be provided by the actual seller of the item of jewelry and it will report the actual selling price. In this type of appraisal, the seller is disclosing his/her role in the transaction. This type of document is valid and is usually acceptable for obtaining insurance.