What is an appraisal?

The following definitions are brief descriptions to aid clients in understanding the types of appraisals, and do not reflect the complexity of professional requirements and definitions.

Insurance Appraisal: An appraisal is a written statement, by a qualified person, identifying an item, its characteristics and qualities, including a value. This type of appraisal estimates what a private individual would most likely have to pay to obtain an item of like kind and quality, at a retail establishment.

Besides insurance appraisals there are many other types of appraisals. The two most common are:

Fair Market Value (FMV) Appraisal: An estimate of what one private individual might expect to sell an item for, to another private individual, who is buying for their own personal use, not for resale. This appraisal is the standard type of appraisal used for distribution of family items among the heirs of an estate or trust; to supply information to individuals who are contemplating selling an item; the guardians or trustees of an estate, in order to establish legal values; the settlement of divorce or some other legal issues. 

Estate Appraisal: this is specifically designed to provide information to the executor/executrix, trustee or personal representative of an estate in order to determine federal tax liability. Additionally there are gift, donation, collateral, cash and hypothetical, or post lost assessment appraisals.