Valuations Explained

What is valuation?
A "valuation" is generally meant to be a document that provides a record and description of an item/s and gives a monetary value.
A more accurate title for such a document should be "appraisal and valuation", and indeed the title "appraisal" is more common in the United States than "valuation".

Valuations should be professionally prepared researched and presented, with the valuer in a position to substantiate his work in a court of law in the final analysis. For example a written valuation has been seen as this:

"A Platinum ring set with a single Diamond £6500"
Instead of supplying the customer with all the basic essential information - the cut, colour, clarity and the dimensions of the diamond, the age of the ring, the style of setting etc., the valuer has provided a woefully inadequate document, hardly worth the paper it is written on.

Jewellery Valuations require expertise and discipline in order to ensure that descriptions are precise, identifications correct, measurements accurate and that the salient facts are recorded and the proposed value supportable. Nevertheless, valuing is not an exact science and actual descriptions and values are a matter of opinion not fact.

In reality, however, if you show the same ring to three different valuers you will get three different opinions as to a "correct" retail price. This is not unreasonable when it is considered that a value is an opinion, and opinions are formed after taking many factors into account.

Experience is crucial, as well as sound and logical theoretical learning, ideally through the educational courses offered by for example the National Association of Goldsmiths and the Gemmological Association for example.

What is the purpose of a valuation?
Customer are often unsure about the purpose of valuations and frequently "just want to know what it's worth". The purpose for a valuation can include:

• Insurance Replacement
• Post-Loss Assessment
• Probate
• Private Sale
• Loan Security
• Capital Gains Tax
• Family Division

Of these purposes, insurance makes up more than 90%. In a typical insurance valuation the information given should provide the owner with a detailed and professional catalogue or inventory of their personal possessions. It should also enable them to provide information so that an insurance policy may be prepared and a premium calculated.
Should items be lost or stolen, the schedule can:

• Provide a checklist so that a claim may be made for everything missing
• Facilitate recovery and recognition by police
• Assist in proving ownership if the items are recovered
• Enable similar items to be purchased or replacements to be made
• Show that on the date stated the items existed and were examined by the signatory
• Ensure that in the event of any dispute with an insurance company or loss adjuster there is a firm foundation on which to base a case.
• Check that any replacement supplied is of comparable quality and value with an original

An insurance valuation can also establish previous ownership on return from abroad and so avoid VAT or import duty liabilities.

See services for pricing of our valuation service.