March 2011

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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Composite Rubies-
From bad to worse

The defendant is Macy's.
The subject is composite rubies.
The issue is disclosure.

Two lawsuits have been filed against Macy's for falsely representing the gems it sells. Gems sold as natural rubies “were in fact heavily glass filled and often heavily lead-glass treated,” said the class action suit.

Two televised sting operations, by “Good Morning America” and by San Francisco's “CBS 5,” brought public attention to the scam. On hidden cameras, jewelry department sales staff insisted the stones were ruby and required no special care. Subsequent examination by a gemologist proved them wrong.

Composite rubies are another step in increasingly flagrant gem adulterations.

It began with fracture-filling

When a gem has surface fractures, technicians may fill them with some non-gem material, such as glass. This makes the stone look better to the unaided eye, though it does not improve the stone. The gem still has fractures, and they are easily seen though a jeweler's loupe.

A fracture-filled stone is worth considerably less than a gem of similar appearance that is not fracture-filled.

What is a “composite ruby”?

You might say that a composite ruby is a fracture-filled ruby on steroids. During the past eight years, gemologists have been seeing stones with increasingly large amounts of glass. Glass fills not only surface fractures but deep cavities

Gem material may be so fractured, it could not be considered for use in jewelry if the cracks were visible. Lead glass fused into the stone hides the cracks. Some of these composite stones are more filling than ruby, the glass acting as a sort of glue holding the piece together. For more details, see our December 2007 issue.

Natural, untreated ruby
Heat-treated ruby

Glass-filled ruby

Natural ruby is one of the hardest stones in existence, second only to diamond. A high-quality untreated ruby rivals diamond in value.

But composite rubies, being in large part glass, are fragile. As the filling deteriorates, the stones can lose their color, show cracks, and even break into pieces.

Cleaning the stones is also a delicate matter. Some jewelers report placing composite rubies into standard gem cleaning solutions and having them “dissolve like Pop Rocks”-and having the owners blame jewelers for the damage. Composites can even be harmed by ordinary household products like lemon juice and strong detergents.

Glass filling breaks down
Photomicrograph by Christopher P. Smith of AGL

There may also be health and safety issues associated with the lead content. In a separate investigation of Macy's rubies, the San Francisco Public Press had its purchases tested for lead, which is used to improve the visual properties of glass. All the composite rubies showed significant lead content. Some appraisers and others in the jewelry industry are working to get the FTC to ban from gems and jewelry, as it is from other consumer products.


Industry lawyers and the Jewelers Vigilance Committee concluded years ago that the ruby composites cannot legally be sold as rubies or precious gems under FTC Guidelines. In 2007 a consortium of international gemological labs decided the stones should be called “ruby-glass composites.”

Gemologist Antoinette Matlins, author of Jewelry & Gems: The Buying Guide, suggests a completely different word - rubaire. “It's a ruby with a lot of air filled with glass,” she says. “Call it whatever you want, and charge $10 or $20 for it in the costume-jewelry aisle.”

But Macy's was calling it ruby and charging for ruby. Its website said, “Due to the nature of some treatments, such as fracture-filling, and the fact that technology and practice is constantly changing, we cannot guarantee that all have been detected.”

Page from Macy's catalog
[from San Francisco Public Press website]

In fact, the independent gemologist hired by Macy's West to oversee the quality of gems it received for sale did detect treatments and repeatedly warned the company about the composite rubies it was buying. The store ignored his recommendations to reject the goods or to disclose their true nature to customers. He said, “All they wanted to talk about was how they could glamorize the product.”

Composite rubies were not the only deceit at the jewelry counter. According to the lawsuit, the store also represented heated quartz as “green amethyst” (purple amethyst is the only kind there is), black sapphires as black diamonds, irradiated diamonds as natural black diamonds, and fracture-filled or laser-drilled diamonds as untreated stones. In all these instances, the value difference between the real thing and the substitute is immense.

Flourishing fraud

Macy's is not the only store selling treated gems without proper disclosure; it's just the one big enough to merit a class action lawsuit. If a large and reputable company thinks it can slip through such adulterated, low-quality and bogus gems, how many other sellers with a lower profile and “less to lose” are doing the same?

As gem technology advances, opportunities for fraud increase. The insurer's best protection is a detailed appraisal from an experienced appraiser who is a Graduate Gemologist and preferably a Certified Insurance Appraiser™.


Keep on file all documentation for scheduled jewelry, including the sales receipt. Be sure to get a detailed appraisal, preferably on JISO 78/79, from an appraiser who is not the seller.

For rubies and other colored stones, it is essential that the appraisal be written by a gemologist experienced with colored gemstones and familiar with the current pricing, treatments and frauds. Most jewelers deal primarily with diamonds, and even a trained gemologist may have little experience with colored stones.

For ruby, all treatments other than heating should be disclosed on the appraisal. (Heat treatment may also be listed, but ruby is assumed to be heat-treated unless the appraisal specifies it has not been.)

If a gem is not treated, that should be specifically stated on the appraisal. A treated stone has only a fraction of the value of an untreated gem of similar appearance.


In damage claims, have the jewelry examined by an independent gemologist to verify the jewelry's quality and the truth of the appraisal. The exam might reveal, for example, that the stone was treated and the treatment broke down; this is damage for which the insurer is not liable.

Examine the appraisal for words such as composite, treated, fracture-filled, enhanced, synthetic, lab-grown, or other qualifying terms that suggest the stone is other than natural, untreated ruby. Treated and synthesized gems are worth a fraction of the value of natural gems of similar appearance.

Just for comparison: One source puts the wholesale value of high-quality rubies at $5,000-$12,000 per carat; rubies of lesser clarity and color at $350; and ruby composites at $1-$50.

Do not assume that if the appraisal doesn't mention treatments, the gem must be untreated; most likely, if treatment (or lack of it) is not mentioned, other information is incomplete as well.

If there are any terms on the appraisal you don't understand, consider consulting a jewelry insurance professional, to avoid serious overpayment.

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