Let's say you bought a $6k ring. And it appraises for $12k. Do you think you could sell this for $12k? Mars maybe, since they are clueless martians who are mesmerized by the unique sparkle of a rock not made of red clay.

About the only thing an inflated appraisal value is likely to get you is high insurance premiums.

And once you realize this, that warm, fuzzy feeling about the deal you got evaporates in a puff of gold star dust. Those inland marine policies, aka -rider policies for your home insurance, aren't cheap. Home insurance policies typically cover up to $1,000 by the way. But all policies are different. So check with your insurance carrier and ask questions, find out what the deductible is and if you're covered away from home or out of the country.

The seller's value is usually a fair appraisal value if, in fact, you bought from an honest seller

If you did actually get a G/SI1 1.75 round brilliant cut and not a J/SI2 round brilliant cut then the seller's appraisal is probably fine for insurance purposes. However, if they are using some bogus pretty appraisal on certified-looking paper to inflate the value of the diamond in the selling process so you feel like it's a deal, go elsewhere.

Of course, if it came with a GIA Report and the plot on the report matches that of the diamond, then the grade is legitimate. An outside, independent appraiser can validate if a report goes with the diamond in most cases. This is where a GIA report comes in handy. It offers an appraiser some boundaries in which to return a fair appraisal price. But do keep in mind they are not going to let you waltz out of a jewelry store with a diamond in hand unpaid for so you can get this outside, independent appraisal.

What about Aunt Sarah's antique diamond ring she left you?

Well, antique jewelry appraisal prices are all over the place. You can't always compare older cut diamonds with modern cut diamonds. So, really, the value is in what will the buyer pay for it. You can't put a price on sentiment. And that might just be the most valuable part of the ring.

If you are going to have an antique ring appraised, make sure you ask for an appraiser with experience in pricing antique jewelry since. But if you take it to two different appraisers, don't be surprised if the final value is different.

What about dealers selling a diamond based on an appraised value?

Most likely, the dealer has his own appraisal done for the ring. If you're a dealer and it's your diamond would you give it a fair and acurate price knowing you'll make more if you bump it up in value?

Now there are dealers who will offer to make an appraisal after the sale that comes with the diamond jewelry. And he/she will tell you it's good enough to present as fair value to an insurance company. This is fine. You just want to make sure it's not inflated so you aren't paying through the nose to insure it. But you want a bit of cushion, since diamond prices fluctuate.

What to look for in an appraiser.

Ideally, you want a U.S. appraiser to be part of a lab certified by the Accredited Gemologists Association and/or the American Gem Society. When buying, the phrase "GIA graduate gemologist" is often used by diamond sellers to fool you into thinking it's a diamond with a GIA Report when it's not. But if your appraiser is a GIA graduate gemologist, it's a good thing.

You might want to consider an appraiser that is independent of selling diamonds and gemstones and jewelry. That's not to say they are crooked if they have some jewelry on site but it fits the definition of "independent" more accurately if they don't.

An appraiser is not the GIA

The GIA is an independent lab. They do not assign monetary value to a ring or diamond. They grade diamonds objectively. Therefore an appraisal, while not without value certainly, is not the same as a GIA Report. Many times you'll have the GIA Report and still need an appraisal. Do not keep the GIA report from the appraiser. It's an important part of the appraisal process, not a game to see if they can come up with the same color on the report.

Most insurance companies insure with rider policies, also known as the inland marine policy. And there are insurance companies that are exist primarily to insure luxury goods. Do your homework. Certainly, policies tied to the companies you know are credible. So simply keep in mind that you need to look up or ask questions regarding companies you've not heard of before. And keep in mind the appraisal you get, will dictate what you pay in insurance premiums to insure the item.

http://accreditedgemologists.org/

http://www.americangemsociety.org/