It may be time to reappraise jewelry

NEW YORK — With gold topping out at more than $700 an ounce last month — a record price — you may be wondering if your jewelry, watches and other gold valuables have gone up too. They have, though how much varies with what you own.

Since prices are high, it makes sense to be sure you are properly insured for the full market value. “A lot of people probably should have their jewelry reappraised,” says Nancy Stacy, a master gemologist appraiser based in Walnut Creek, Calif.

When it comes to jewelry, she says, price depends on many things.

The cost of a diamond engagement ring is mainly in the diamond, and recent rises in price are being passed on to the consumer very quickly. On the other hand, the value of a mass-produced gold chain resides mostly in the amount and purity of the gold in it. That means that machine-made, gold-heavy products will rise significantly in value when the price of gold goes up, although consumers can expect some lag time before seeing higher price tags.

For other jewelry, says Stacy, prices are driven primarily by artistic qualities or the uniqueness of the item, which are the results of labor rather than materials. Don’t expect the value of those items to correlate closely with the commodities markets.

Insuring jewelry typically costs around 1.5 percent of its value annually, with discounts offered if the items are kept in a bank vault and rarely worn.

Some things to watch out for: per-item limits, which restrict how much you can insure each piece of jewelry for and can leave you underinsured, and overvalued appraisals. Since most policies pay for replacement or fair market value, if you price the jewelry too high, you’ll wind up paying for insurance you don’t need, says Stacy.

Fireman’s Fund will pay up to 50 percent over the insured price to compensate for appreciation in the fair market value, says Chris Heidrick, Fireman’s vice president of personal insurance. Fireman’s charges about $1.20 per $100 of value for insurance.