March 2013

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

2017

Moral Hazard, Documents and the Bottom Line - January

Ruby and Jade - February

How to mail a diamond - March

Jewelry Insurance Appraisal Standards: JISO - April

2016

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

2015

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

2014

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

2013

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

2012

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

2011

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

2010

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

2009

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

2008

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

2007

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

2006

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

2005

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
October

Grading the Color of Colored Diamonds
November

New GIA Cut Grade for Diamonds - December

2004

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

2003

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

2002

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

2001

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

2000

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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Point Protection

Diamond is the hardest gem. Only another diamond can cut or scratch it. In fact, diamond has a reputation of being "forever."

Yet insurers often pay claims on chipped diamonds. And some of those chips could have been avoided.

Chipping

How well a gem survives in jewelry depends on both its hardness and its toughness. Diamond is the hardest gemstone known, so it is safe from abrasion. But its toughness rating is only fair to good. This means diamond's ability to withstand breakage from an impact is only middling. A blow at the wrong angle can cause that very hard diamond to chip.

Oddly enough, both the shape of the diamond and how it is set in jewelry can work to minimize the chances of chipping.

Shape

It's estimated that half the diamonds sold today are round brilliant. This classic cut not only has the most fire and brilliance, but it's also a winner because round is a strong shape. It has no protruding corners or sharp angles that could easily chip off under impact.


Round

Marquis

Pear

Princess
 

 

Stones cut in some other popular shapes, such as marquis, pear or princess, are more vulnerable. Even diamond can easily chip at a point that is exposed.

Setting

It's up to the jeweler to design a setting that not only enhances the gem but protects it.




The two end points of the marquis cut diamond, shown above, are vulnerable. A direct hit on those of the points could easily chip the stone. The center picture shows a marquis cut diamond with unprotected points that could be easily damaged. The jeweler who set the ring show at the right used V-prongs to protect the diamond's points.



Here are two settings of a pear-shaped gem. In the ring at left, the emerald's point is exposed and could easily be chipped. Damage is especially likely because emeralds are rather fragile. In the ring at right, the designer set a pear-shaped diamond in a bezel that shows off the gem's shape while completely protecting the point and the girdle of the stone. A similar all-around protection is given to the princess cut stone shown at the top of the page.

Having a protective setting is less important for earrings or pendants than for rings, as rings are likely to be subject to impact. If you're thinking broken fingers, don't! Even a comparatively slight knock at just the right angle can chip an exposed point of a gem.

So, what does all this mean to insurers? Do underwriters and adjusters have to know all about marquises and bezels and prongs?

Pictures

This is one reason to ask that a picture accompany the appraisal.

We know that a picture can show much more detail that could ever be described in language on an appraisal. In the past we've discussed the important role of a photo in identifying jewelry and in pricing a replacement after a total loss.

A picture can also reveal if the stone is not well protected in its setting. If the stone in a ring has exposed points, which are likely to chip under impact, this is damage waiting to happen. It may even be considered inherent vice.

An underwriter who sees such vulnerable points can decide whether or not to take the risk. For a half-carat marquis valued at $4,000, it may not matter. For a 5-carat marquis worth $100,000, it's an important consideration. The underwriter may want to add an endorsement to the policy that excludes breakage altogether; or he may simply want to decline coverage.

There is a lot of poorly crafted, poorly mounted, highly damageable jewelry out there. In an ideal world, the appraiser would note such potential for damage—just as he would note a loose stone in danger of falling out. But most appraisals do not meet this standard. It's up to the insurer to take advantage of all possible clues in spotting potential risks.

FOR AGENTS & UNDERWRITERS

An appraisal or lab report should identify the shape of the stone, and that shape is a clue as to the potential for easy damage because of improper mounting. A look at popular gem shapes will help you identify the terms gemologists use for shapes.

Note: Some appraisals and other documents misleadingly list the shape of a gem as its cut. (Cut is a completely different and much more complex issue, not directly relevant to our discussion here of shapes. See Cut as one of the 4Cs for an explanation of cut.)

A photo should be included with the appraisal for any high-value jewelry. A photo can:

Review Every picture tells a story and How photos cut fraud and help the insured.

It is best to have a detailed JISO 78/79 (formerly ACORD 78/79) appraisal from a competent and experienced jeweler/appraiser who has a GG, FGA+ or equivalent degree, and preferably is also a Certified Insurance Appraiser™ (CIA).

FOR ADJUSTERS

In a gem of any shape, poor cut proportions can produce places vulnerable to damage, such as a too-thin girdle. A detailed appraisal, such as JISO 78/79, will give all cut proportions. From such an appraisal, an experienced jeweler can determine whether cut proportions were so poor as to constitute inherent vice.

On a damage claim for a high-priced diamond, always have the piece examined by a qualified gemologist, such as a Certified Insurance Appraiser™, to determine whether the diamond was properly set, whether damage was due to inherent vice, and to be sure the gem's qualities are as stated in the appraisal.

If you have any suspicion that damage may be due to inherent vice, it may be worthwhile consulting a jewelry insurance expert.

Make use of the picture when pricing a replacement. It often reveals details that are not mentioned on the appraisal.

For damage claims, a photo may show that damage can be repaired at far less expense than a total-loss payout.

 

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