Insurance values vs prices when selling...

How can you know what to expect when selling a piece of jewellery? You may know the insurance replacement value but this is not the same as what someone will actually pay to buy it...this guide explains why. 

As a background, it’s worth appreciating that items can have multiple and differing values. At one end of the spectrum is a basis of valuation called New Replacement Value. This is the highest value you can give something – it’s the amount of money an insurance company have to pay (perhaps less an excess) in order to allow you to go out and buy the same, or very similar, items again at a common price anywhere in the UK at full retail values and of course includes taxes such as VAT in the figure.

Towards the other end of the spectrum, is what commercial businesses might offer if they were buying. Obviously, they wouldn't buy items at insurance values:- shops need to buy at less than this if they are to commit their capital and risk to items they hold in stock in order to sell them at some point in the future and stay in business! 

Different businesses may offer different prices to buy from Sellers: they may be generous or not; they may be specialists in that kind of jewellery, their circumstances may differ to another Buyer. It's your job as a Seller to do the best you can.

In simple terms the value of an item when trying to sell is the most you can get at the time you're looking to sell it. It's usually a practical and achievable amount of money you could realise if you had to sell the items in a reasonable time frame, taking into account condition, market demand and more. This of course would exclude taxes (e.g VAT).

As a rough but not binding guide, it’s not uncommon to expect the price offered by a shop - if indeed they want to make an offer (they're not obliged!) -  to be between 10% and 30% of a new replacement value.

Here's a rough example: If new replacement value for an item is £1000, deduct the VAT you have to pay on that new item to leave £830.33. Therefore it's it's not uncommon or unreasonable that offers could be between £100 and £300, though there are of course exceptions to this range. The difference can easily be accounted for by costs to the Buyer of refurbishing, costs of holding item in stock and risk; not to mention the fact that they may be able to buy a new, mint condition item instead.

Getting more than this is definitely achievable however it requires the Seller to spend the time in doing the job of a professional: finding willing buyer/s with the associated risk/ time associated.


If you'd like to know more, or would like us to help you with an enquiry, do make contact.

Ask Jacobs More

Article by Adam J

Adam J

Adam's been working at Jacobs since 2003, has a professional jewellers diploma and looks after the business as whole.

Book your appointment (recommended)