The difference between insurance valuations and valuations for auction

Fred Wyrley-Birch, director of Anderson and Garland, explains the distinction between an insurance valuation and the pre-sale value of an item for sale at auction:



There are key factors to keep in mind when you’re having an item valued, and the purpose of the valuation is the most important factor.  Most of what we do is valuations for auction, although we also specialise in valuations for insurance and probate valuations.

A valuation for insurance is completely different to a valuation for auction. A valuation for insurance determines the value of replacing the item from new if it was lost or stolen, while the value of an item for auction is determined by the value it would sell for according to the market.

Valuations: insurance vs auction

The diamond trade offers an excellent analogy to demonstrate the difference between insurance valuations and valuations for auction.

For every tonne of alluvial soil that is mined for diamonds, five carats of diamond are generally produced. Of those five carats, four carats are of industrial quality for cutting, typically. One carat will be gem quality and is generally made up of three to four stones.

So, all that work has gone into mining that one carat of diamond, then someone must cut it, which requires special equipment, and then the shop that sells it needs to pay rent and insurance and their employees, etc. Basically: it’s expensive to get diamond from the ground to your finger! All of those expenses get handed onto the consumer.



That’s why an insurance valuation of a diamond will be so high, because that’s the finance you’d need in order to replace it.

However, like a car, once you pay for a diamond and leave the shop, the price comes down if you were to resell it. With diamonds, the resell price is typically one tenth of the cost you paid for it! This is not the same case with all antiques, which is generally around one third of the price. This is why a valuation of a diamond for sale at auction won’t match the insurance valuation price, because it just doesn’t appreciate as well as some other items.

When offering our clients a pre-sale valuation for auction, our job is to get to a level that is achievable for the market. This is why the market really decides on what things are worth.

Frequently, a client will bring us an item with very high resale expectations based on an insurance valuation. However, we know the market, we’ve seen many, many types of items and can estimate a pre-sale value of what it could sell for at auction. It’s the knowledge of the value that is important to our customers, which is why they trust us to come to us for both valuations for sale at auction and insurance valuations.

Insurance valuations in Newcastle, the North of England and the Borders


Our insurance valuations are accepted by all the leading insurance companies and underwriters.

All valuations are carried out with the utmost discretion and professionalism by Anderson and Garland auctioneers. Each one is tailored to the individual client’s specific requirements and can include digital photographs upon request.

We recommend that insurance valuations are updated every five years or so in order to cater to changing market prices and to ensure your insurance premiums remain low.


Whether you have a single item you’d like valued or an entire house contents, we will provide a valuation that will be invaluable in the event of a loss of property. Our professional fees are very competitive and are calculated on an hourly basis.

To arrange an insurance valuation with one of our valuers or for more information about this service, call us on 0191 4303000 or email



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