July 2004

JEWELRY INSURANCE ISSUES (formerly IM News), provides monthly insight and information for jewelry insurance agents, underwriters and claims adjusters.

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Jewelry Insurance Issues

Table of Contents

Click on article titles in red


What's a Certified Appraiser? - January

Best Appraiser Credentials - February

Are the diamonds you’re insuring real? - March

Handwritten Appraisals - April


Moral Hazard, Documents and the Bottom Line - January

Ruby and Jade - February

How to mail a diamond - March

Jewelry Insurance Appraisal Standards: JISO - April

Describing a gem's color - May

Why not just put jewelry on the Homeowner policy? - June

GIA Diamond Reports - July

Not just a pretty face - August

Moral Hazards on the rise - September

Hurricanes, fires, floods—and jewelry insurance - October

Inherent vice / wear-and-tear losses are rising - November

FRAUD UPDATE – lack of disclosure, false inscriptions & doctored docs - December


Inflated appraisals—alive & well! Shady lab reports—alive & well! MORAL HAZARD—ALIVE & WELL! - January

Clarity Enhancements v. Inherent Vice - February

How green is my emerald? - March

Cruise Jewelry - What's the problem? - April

Crown of Light®- how special is it? - May

Diamonds at Auction — Big gems, big prices, and the trickle-down effect - June

Are you sure her wedding jewelry is covered? - July

What Affects Jewelry Valuation? - August

What to look for – on the jewelry appraisal, on the cert, and on other documents - September

Bigger & Bigger Diamonds - October

Scam season is always NOW - November

Ocean Diamonds - December


Pair & Set Jewelry Claims and the Accidental Tourist - January

Is that brand-name diamond a cut above the others? - February

Vacation Jewelry – Insurer beware! - March

Apple's Smartwatch – The risk of a wrist computer - April

Why you should read that appraisal - May

Smoking Gun! - June

Color-Grading Diamond: the Master Stones - July

Padparadscha—a special term for a special stone - August

Jewelry Appraisal Fees - September

Insuring a Rolex - steps to take, things to consider - October

Diamond camouflage and how to see through it - November

GIA Hacked! - December


Who Grades? - January

Sales, discounts, price reductions, bargains, specials, mark-downs . . . . and valuation - February

Credential Conundrum - March

Frankenwatches - April

Fakes, fakes, and more fakes - May

Marketing Confusion — What is this gem anyway? - June

12 Reasons Not to Insure a Rolex! - July

Why NOT to insure a Rolex: Reasons 5-7 - August

Why NOT to insure a Rolex: Reasons 8-10 - September

Why NOT to insure a Rolex: Reasons 11-12 - October

The Doublet Masquerade - November

Is the gem suitable for the jewelry? Is this a good insurance risk? - December


Wedding Rings on HO? NO! - January

Silver: the new gold - February

Point Protection - March

Tiffany v. Costco - April

What counts in valuing a diamond? - May

Appraising Jewelry - What's a credential worth? - June

A Cutting Question concerning vintage diamonds - July

Synthesized Diamonds - Scam update - August

Pretty in Pink - Kunzite on parade... - September

Preventing jewelry losses - October

Scratch a diamond and you'll find . . .??? - November

Synthetics in the Mix - December


Advanced Gem Lab - A deeper look at colored gems - January

Whose Diamond? - February

Appraisal Inflation - It Keeps On Keeping On - March

Big Emerald - April

Changing colors and making gems: Are we seeing "beautiful lies"? - May

Diamonds - Out of Africa. . . or out of a lab? - June

Appraiser's Dream Contest - July

GIA & the Magic of Certificates - August

Pricey when it's hot: What happens when it's not? - September

Fooling With Gold - October

Tanzanite – December's stone - November

Branding Diamonds - What do those names mean? - December


Unappraisable Jewelry - January

Replicas - Are they the real thing? - February

Composite Rubies- From bad to worse - March

Jewelry Hallmark - A Well-Kept Secret - April

Non-Disclosure: Following a Trail of Deception - May

Preserving the Diamond Dream - June

Spinel in the Spotlight - July

Jewelry 24/7 - Electronic Shopping - August

Diamond Bubble? - September

Disclosure: HPHT - October

"Hearts & Arrows" Diamonds - November

How a Gem Lab Looks at Diamonds - December


Emeralds - And What They Include - January

Pink Diamonds: From Astronomical to Affordable - February

Palladium-the Other Precious White Metal - March

Bridal Jewelry - April

The Corundum Spectrum - May

How Photos Cut Fraud - and help the insured - June

The Price of Fad - July

Old Cut, New Cut-It's All about Diamonds - August

EightStar Diamonds-Beyond Ideal - September

The Hazard of Fakes - October

Jewelry with a Story - November

Counterfeit Watches - December


Blue Diamond-cool, rare and expensive-sometimes - January

Turning Jewelry into Cash—
Strategy in a Bad Economy
- February

Enhancing the Stone - March

Being Certain about the Cert - April

Every Picture Tells a Story - May

Color-Grading Diamonds - June

The Newest Diamond Substitute - July

What Happens to Stolen Jewelry - August

Jewelry As an Investment - September

Black Diamond: Paradox of a Gem - October

Protect Your Homeowners Market—Keep Jewelry OFF HO Policies! - November

What’s So Great about JISO Appraisal Forms & Standards? - December


Garnet - and Its Many Incarnations - January

Organic Gems - February

Do Your Jewelry Insurance Settlements Make You Look Bad? - March

Don't Be Duped by Fake JISO Appraisal - April

Diamonds in the Rough - May

The Cultured Club - June

Sapphire-Gem Superstar - July

It's a Certified Diamond! 
- But who's saying so?
- August

FTC Decides: Culture Is In! - September

Paraiba Tourmaline – What's in a Name? - October

How Fancy is Brown? - November

CZ – The Great Pretender - December


Moissanite's New Spin - January

Online Jewelry - Buying and Insuring - February

Blood Diamonds - March

Damaged Jewelry, Don't Assume!- April

Chocolate Pearls - May

Appraisal Puff-Up vs Useful Appraisal - June

It's Art, but is it Jewelry?
- July

Diamonds Wear Coats of Many Colors - August

DANGER! eBay Jewelry "Bargains" - September

TV Shopping for Jewelry - October

Enhanced Emerald: clever coverup - November

How do you like your rubies -
leaded or unleaded?
- December


The New Platinum: A Story of Alloys - January

Ruby Ruse - February

How Big are Diamonds Anyway? - March

GIA Diamond Scandal
Has Silver Lining for Insurers
- April

Watch Out for Big-Box Retailers Insurance Appraisals - May

Mixing It Up: Natural and Synthetic Diamonds Together - June

Tanzanite - Warning: Fragile - July

Red Diamonds - August

Inflated Valuations & Questionable Certificates - September

Emeralds - October

Where Do Real Diamonds Come From? - November

Counterfeit Watches - The Mushroom War - December


The Lure of Colored Diamonds - January

Synthetic Colored Diamonds - February

Watches: What to Watch for - March

When is a Pear not a Pair? - April

The Truth About Topaz - May

White Gold: How White is White? - June

One of a Kind - or Not - July

Jewelry in Disguise - August

Valued Contract for Jewelry? Proceed with Caution! - September

Antiques, Replicas and All Their Cousins

Grading the Color of Colored Diamonds

New GIA Cut Grade for Diamonds - December


Synthetic Diamonds - and Insuring Tips - January

Bogus Appraisals and Fraud - February

A Picture is Worth Thousands of Dollars - March

Don't be Duped by Fracture Filling - April

Gem Scams Point to Need for Change - May

What is a Good Appraisal - June

4Cs of Color Gemstones - July

Gem Laser Drilling: The Next Generation - August

Why Update an Appraisal? - September

When to Recommend an Appraisal Update or a Second Appraisal - October

Secrets of Sapphire - November

Will the Real Ruby Please Stand Up - December


Mysterious Orient:
A Tale of Loss
- January

Bogus Diamond Certificates and Appraisals - February

Can Valuations be Trusted? - March

Spotting a Bogus Appraisal or Certificate - April

Counterfeit Diamond Certificates - May

Case of the Mysterious "Rare" Sapphires - June

Politically Correct Diamonds - July

Name Brand Diamonds - September

Princess Cut: Black Sheep of Diamonds - October

Reincarnate as a Diamond - November

Synthetic Diamonds - December


Irradiated Mail/Irradiated Gems - January

Fake Diamonds (Moissonite) - February

GIA Diamond Report - March

AGS and Other Diamond Certificates - April

Colored Stone Certificates - May

Damaged Jewelry: Don't Pay for Nature's Mistakes - June

The Case of the "Self-Healing" Emerald - July

Mysterious Disappearance: Case of the Missing Opals - August

The Discount Mirage - September

What Can You Learn from Salvage? - October

Gaining from Partial Loss - November

Year in Review - December


Colored Diamonds - January

Good as Gold - February

Disclose Gem Treatments - March

FTC Jewelry Guidelines - April

Myths Part I: Each Piece is Unique - May

Myths Part II: Myths, Lies, & Half-Truths - June

New Trend: Old Cut Stones - October

The Appraisal Process - November

Year in Review - December


Deceptive Pricing - January

Gems - Natural or Manmade - February

Jeweler/Appraisal Credentials - March

Fracture Filling - April

Salvage Jewelery - May

Gem Treatments - June

Don't Ask/Don't Tell - A Buying Nightmare - July

Laser Drilling of Diamonds - August

Jeweler Ethics or the Lack Thereof - September

Gem Scam - October

The Truth about Clarity Grading - November

Year in Review - December


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Colored Gemstones:
the “4 Cs” & Other Considerations

How are colored gems valued? Are the same criteria used as for diamonds? Can any jeweler appraise colored gems? What should insurers watch out for?

Colored gems is a phrase that includes about sixty varieties of mineral suitable for jewelry. There are also a few organic materials used in jewelry, such as coral, amber and pearl. They are all judged by the “4Cs”: Color, Clarity, Cut, and Carat weight.


For colored gems, the most important determinant of value is their color.

Tone, Saturation, Hue

A color "grade" is not simply a place on a scale but a set of precise descriptive terms. The gemologist grades in terms of tone (the lightness or darkness of a color), saturation (the intensity of a color, or the degree to which a color departs from neutral or gray), and hue (using the Color Stone Grading System, which specifies 31 hues). An emerald's color, for example, might be described as "Medium Light" tone, "Very Slightly Grayish" saturation, and "very slightly bluish Green" hue.

Too often, appraisals contain only brief and vague descriptions of color, as though it didn't much matter. However, the gemological terms for gem color are standardized and specific. Appraisals should always describe color in terms of tone, saturation and hue, as on ACORD 78/79. (click the image to see a full-sized pdf in a new window).


Some color gems have characteristics called phenomena that enhance their beauty and value. One of these is chatoyancy, or cat’s eye.


Clarity is the term used to describe the internal quality of a gem. The appraiser examines the gem for inclusions, cracks, cavities, clouds, or other imperfections.

The Gemological Institute of America recognizes 8 levels for clarity. The scale applies to all gems, but the definition of each grade varies by gem type and greatly affects price.

For example, a moderately included one-carat emerald retails for about $2,000, while a one-carat aquamarine stone only slightly included (that is, of a higher clarity grade) retails for only $200.

Clarity Enhancement

Because gems of high clarity are rare and expensive, gem suppliers have developed a number of treatments for improving the appearance of lower-quality stones. One of the most widely used is fracture filling, in which cracks in the gem are filled with a non-gem material to make them less visible.

Clarity treatments, or enhancements, merely disguise the flaws in the stone, they do not remove them. What began as a low-quality gem remains a low-quality gem. And a gem with severe fractures, whether or not they are visible, is more vulnerable to chipping or cracking.

Clarity treatments should be disclosed to the buyer before the sale and they should be disclosed on the appraisal. (If a gem is UNtreated, that should be specifically stated on the appraisal). The value of a gem is based on its quality rather than on its appearance to the naked eye.

You may want to look over information on emerald treatments, ruby treatments and sapphire treatments. Being acquainted with the terminology will help you in discussions with jewelers.


Colored gemstones are cut to best show their color. For many richly colored stones, a smooth rounded shape or a flat polished surface does this best.



Transparent gems are usually faceted to show them to best advantage.


There are a number of shapes for faceted stones, but shape should not be confused with cut.

Cut Porportions

Cut proportions — cut, for short — determine how light reflects and refracts on the faces of the stone, and returns to the viewer’s eye. These cut proportions — table percentage, crown angle and pavilion percentage — should appear on the appraisal (click the image to see a full-sized pdf in a new window).



Toughness refers to the ability of a gem to resist breakage, as from a blow or fall. Ruby and sapphire have a toughness rating of excellent, but emerald’s rating is only fair to poor. This means emerald is more vulnerable to damage, and that cut proportions are especially important. If the girdle is too thin, the gem is more likely to chip.

Carat Weight

This is the “C” that buyers are most familiar with, but more weight is not necessarily better. As we just mentioned, good proportions have more value than mere weight.

It is also worth noting that raw weight, in itself, is not necessarily valuable. A number of scams have been based on insuring large amounts of rough mineral material at greatly inflated values. The material then goes missing and the insurer is caught paying out as though gem material were, indeed, high quality gems.

Important Considerations

Not every jeweler who appraises diamonds is competent to appraise colored gemstones. It’s important that the appraiser be familiar with colored gems, and experienced in handling them so as to be able to recognize and describe their subtleties of color and phenomena. Some gems are close in appearance but very different in qualities, requiring an expert’s eye to distinguish them. The appraiser should also be engaged in buying and selling colored gems so he is familiar with the market and its price fluctuations.

Synthetics and look-alikes for colored gems are a danger. Some substitutions have been around since the 17th century. In modern times, lab-made gems have invaded the market, often without proper disclosure.

All these circumstances mean it’s very important to know you’re dealing with an honest and competent jewelry professional when pricing a repair or replacement.


Check the appraisal for specific information on tone, saturation and hue. These are most important in determining the value of colored gemstones.

For faceted gems, check that the appraisal lists cut proportions (especially table percentage, crown angle, pavilion percentage).

Consider whether to insure against breakage gems that are particularly fragile, such as opal or highly included emerald.

For jewelry valued at $25,000 or more, get a second appraisal. Be sure the appraiser is experienced in dealing with colored gemstones.


In damage claims, have the jewelry examined by a jewelry professional working on your behalf to verify the jewelry’s quality and the truth of the appraisal. He might find, for example, that the stone was treated and the treatment broke down (damage for which the insurer is not liable).

For loss claims, carefully read the appraisal for mention of such terms as treatment, clarity enhancement, or fracture filling. These would suggest a lower-quality stone, perhaps with a significantly lower valuation than listed on the appraisal.

Be sure the jeweler examining a damaged stone or pricing a replacement has experience in dealing with colored stones. He should also be a graduate gemologist and a Certified Insurance Appraiser™.


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