Q. Appraisals?
I have some jewelery my mother gave to me. Some is costume and some is "real". I need appraisals done for the "real" pieces for insurance purposes. What is the going rate for appraisals? And how do I find someone qualified to perform the work? - Virginia Beach

A. My wife’s aunt likes to diagnose friends and family illnesses. She is pretty good, but never went to medical school and never had to pass any state board exams. I love her dearly, but I wouldn’t pay her to be my doctor. So is it with appraisers. Many jewelers perform appraisals, and perform them badly. Being in the jewelry business or even being a Graduate Gemologist does not qualify a person to perform appraisals. A professional appraiser can best be found through an accredited appraisal society. There are two that stand out for high standards of membership and conduct, The American Society of Appraisers and the International Society of Appraisers, both of which can be accessed through our web site. The ASA is the only society, which is a member of the Appraisal Foundation, recognized by Congress. It is important to note a common misnomer that there exists a title, “certified appraiser.” No such title exists. Indeed, Virginia does not set standards for personal property appraisers and the insurance industry generally does not have high requirements either. This leaves many options when searching for an appraiser. Beware, a poorly written appraisal can cost you big dollars. There are several titles you should be aware of. Most insurance companies require at the very least a Graduate Gemologist from the GIA, though I have seen some accept a Guild Gemologist from the DCA, which is a less rigorous course. In both cases, valuation science techniques are not included in the curriculum. I would not recommend having either perform an appraisal. It is best to have an appraisal completed by Master Gemologist Appraiser from the American Society of Appraisers. This ensures that you are hiring a true professional, who is required to have continuing education, regular color vision tests, and an accredited gem lab. The absence of any of these requirements can place you at risk if there is a dispute regarding the appraisal. A Master Gemologist Appraiser must meet the highest standards for both gemology and valuation science. They must keep current on their information and be able to determine the proper grades of gemstones, especially color, hence the color vision requirement. Being a Gemologist and having the training will do little without the equipment to perform the task, therefor a Master Gemologist Appraiser must maintain an Accredited Gem Lab. Perhaps the most misused title is that of Certified Gemologist, and Certified Gemologist Appraiser. Both are trademark titles of the American Gem Society and only available to Society members. The Certified Gemologist is a Graduate Gemologist with additional training in cut, while the CGA has additional training in valuation. Non-Society members often use both titles. You should verify these credentials before accepting someone claiming to be “certified”. As to fees, an appraiser must be objective when assigning value. The IRS specifically requires that the fee not be related to the value; it is unethical to perform an appraisal for a percentage of the value, so most appraisers charge by the hour. The difference often lies in the amount of education the appraiser has. It is important to know that you get what you pay for. An appraiser who must certify through a board will typically charge more than one who does not. Because an appraisal is a statement of value, a true appraisal cannot be performed by the jeweler who sold the item because the jeweler has an interest in the value outcome. This document has been labeled by the Jewelers Vigilance Committee (which is also linked to our web site) as more properly, a “Statement of Replacement Price” and should be used when trying to obtain insurance for your jewelry. It is common practice yet unethical for a jeweler to assign an inflated value over the purchase price in order to show the customer they got a “deal.” It is also unethical for a jeweler to assign a low value in order to convince a customer to shop with them, yet it is a frequent tactic. It is also common practice by the insurance industry to issue policies and collect premiums on values known to be dramatically inflated. Consumers often think they will get the amount of money they have insured and so they will look for the highest appraised value. When there is a claim on the policy the consumer is often shocked to learn that the insurance company will only pay pennies on the dollar for such items. For this reason, I recommend getting a professional appraisal with an accurate value and then using an “Agreed Value” type policy. With this type of policy, there is a cash settlement built into the policy and no arguing over the value or replacement of the items. Because most appraisals are not professionally written, most insurance companies do not accept the value as written, but rather assume there is an inflated value for replacement. I could write several more pages on this subject, as it is a problem for the insurance and jewelry industries. I hope this clears up at least some of the questions you have. All the best, David Nygaard

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