Diamond appraisals can be very useful, but many jewelry shoppers are not properly informed about them. Let’s see what a diamond appraisal can do for you and then take a look at how you should choose an appraiser.
What Is a Diamond Appraisal?
A diamond appraisal is an assessment of the value of a specific stone. It is usually done by a professional appraiser who is trained in gemology and valuation.
After the appraisal is complete, the appraiser will issue a document stating the value of the diamond.
If the stone is mounted in a piece of jewelry, the appraiser can assess the value of the entire item if this is what the customer wants.
How a Diamond Appraisal Differs from a Grading Report
Diamond appraisal is not the same thing as diamond grading. While grading a diamond involves measuring its quality characteristics, the grader does not assign a monetary value to the stone.
An appraisal, on the other hand, does exactly that – it quantifies how much a diamond is worth based on its quality and other factors (e.g., market demand).
When to Have a Diamond Appraised
The most common instances in which an appraisal would be particularly useful are when shopping for a diamond (especially online) and when you need to insure it after the purchase.
Diamond appraisals are most often used to establish the value of a stone for insurance purposes.
Insurance companies require an independent appraisal on the basis of which they determine the amount for which they can insure your stone as well as how much you will need to pay for the policy.
You can also use an appraisal when shopping for diamonds to see if there is a significant disparity between the appraised value and the price the stone is sold at.
One way to do this is to have the diamond appraised after you have purchased it but before the return period expires so that you can get a refund if you are not satisfied with the stone.
Some vendors may also agree to send the diamond for an appraisal by an independent professional before you pay for the stone.
Appraising Online Purchases
Keep in mind that if you need an appraisal of a diamond that you are going to buy online, the appraiser will still have to examine the stone physically as just looking at the stone’s photo or grading certificate is not enough for an accurate valuation.
A professional appraiser will usually decline to provide you with a value for a diamond he or she has not examined physically.
Important: When you use the services of an appraiser, make sure he or she knows why you need the appraisal. Depending on whether the assessment is made for insurance or shopping, appraisers may use different methods to arrive at the diamond’s value, which is likely to vary depending on the purpose of the appraisal.
Selecting a Jewelry Appraiser
So, what should you be looking for when choosing an appraiser to value your diamonds?
The most important information you need to pay attention to is whether the appraiser is independent, how he or she calculates the appraisal fees, and what credentials he or she has in the fields of gemology and jewelry appraisal.
One of the most important characteristics to consider when selecting an appraiser is independence.
It stands to reason that whoever is determining the value of your jewelry, he or she should not have a vested interest in how much it is appraised for.
For example, if an appraisal is done by the vendor selling you the jewelry, or by a related party, it will most likely be biased. The first thing you should do when deciding on an appraiser is make sure that he or she is independent.
An issue related to the appraiser’s independence is how the appraisal fee is calculated.
Generally, to eliminate potential bias, an appraiser should not be paid based on the value of the appraisal (i.e., do not hire appraisers that charge a percentage of the appraised value).
The fees charged should be tied to the complexity of the appraisal and the time it takes to complete it.
In some cases, you may find that the pay depends on the size of the diamond evaluated, but this is also related to time and complexity – bigger stones usually take longer to appraise.
It goes without saying that the appraiser should be qualified to make a judgment on the value of a diamond.
Look for certifications proving that the person has been trained in gemology. One such qualification is Graduate Gemologist, denoted by the initials “G.G.” after the appraiser’s name (the British equivalent is “F.G.A.”).
Appraisal and Valuation Credentials
Although knowledge of gemology is necessary, it is not enough as such training is focused on examining a stone’s physical characteristics, not on assigning a value to them.
To make sure that an appraiser is qualified to assess how much a diamond is worth, make sure he or she is also trained in valuation.
Look for qualifications showing that the professional has been certified by a reputable appraisal organization such as the National Association of Jewelry Appraisers (N.A.J.A.), American Society of Appraisers (A.S.A.), American Gem Society (A.G.S.), or International Society of Appraisers (I.S.A.).