November 2002

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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Gaining from Partial Loss

Don’t just replace that damaged jewelry and hope to get something for the salvage. An expert on your side can show you all the options, avoid overpayments, and make your job easier.

It's estimated salvage value was $2,000 to $3,500. However, the insurer’s expert suggested that if the stone were recut (at a cost of about $600), it could be resold for at least $5,900.

In some cases, recutting is not an option. It might be too costly, or there may be too great a risk of breakage in the process, or the recut stone would be too small t make recutting profitable. In giving estimates, an expert working on behalf of the insurer takes such things into account and makes recommendations

The key is that the expert making estimates must be working with the insurer’s interests in mind.

Usually adjusters get repair quotes form the seller of the jewelry or from a replacement firm. Bear in mind that jewelers (and replacement houses!) are in the business of selling jewelry. They make greater profit from replacement than from repair. They are willing to offer repair estimates at no charge because they usually wind up recommending replacement rather than repair.

For cars, it’s assumed that damages will be repaired unless repair costs exceed the car’s current value. This is how jewelry should be handled. For cars, repair experts are consulted, and damage reports use estimating software with fixed costs for each repair. With damaged jewelry, it is often the seller or the policyholder’s jeweler who is consulted; if that jeweler suggests replacement rather than repair, the insurer will probably just go for it.

Insurers should be aware that not all jewelers are manufacturing jewelers. Most have neither the equipment nor the skill to make repairs. As discussed in the May 2001 IM NEWS, literally anyone can call himself a jeweler (or appraiser). Obviously, someone whose experience covers only the selling of jewelry is not competent to estimate repair costs. Nor is it very profitable for him to send the work elsewhere for repair. Instead, he simply recommends replacement.

With salvage, the jeweler can again take advantage of the insurer’s lack of expertise. Here the jeweler assumes (and hopes) you are just looking to unload a useless stockpile of stuff and expect next to nothing (see May 2000 IM NEWS). He has no incentive to maximize salvage quotes.

What you need is an expert on your side, a representative working on your behalf, who gives you all the information to make a fair and cost-effective settlement.

Here’s what an insurer’s expert can do to make adjusting partial losses easier:

  1. Examine the jewelry.

    Your expert examines the damaged jewelry before a settlement is made. He supplies a detailed description of the jewelry, which can be compared with the appraisal in the insurer’s files. Often appraisals lack crucial information. This complete description allows the jeweler to establish the value of the piece (which is not necessarily the insured value or the purchase price).
  2. Determine cost of repair/replacement.

    He assesses the damage, determines whether the piece can be repaired, and if so, estimates the cost. This step is often bypassed by jewelers, since they make more money by replacing the piece than by repairing. If the jewelry cannot be repaired, he will give you a replacement price. You do not necessarily have to repair or replace with the estimating jeweler, but you (or your policyholder) can use this as a baseline for pricing replacements elsewhere.
  3. Give salvage value, plus recommendations.

    With salvage, your expert not only quotes you a salvage value, but he also makes recommendations, such as the profitable recutting of the stone described above.
  4. Supply report in standardized format, including photo.

    Here is an example of such a report prepared by JCRS. This report was for salvage, so it also includes information about the settlement already made. As noted in the report, the carrier had paid far more than necessary in the settlement.

An insurer’s stock of salvage often includes pieces that were found after a settlement was made. Such pieces may be in quite good condition. Other salvage is only slightly damaged jewelry that is repairable or loose stones that can be recut. An insurer may want to offer such high-quality pieces to employees as a perk, selling them at salvage prices. In this case, the expert’s reports, which include photos and complete descriptions, as well as values, can be made available to employees.

All of these services can be outsourced for a minimal fee. Your expert’s business is to get you accurate assessments of damages. Since he doesn’t sell jewelry, his interest is in getting you the lowest possible costs for repair or replacement. Since he takes a percentage of the salvage price, his incentive is to get you the highest possible salvage value. An expert working for you only makes your job easier and your settlement costs lower.


In your review of loss files, use salvage as a measure for appraisal accuracy. If the description of the damaged piece does not match the description on the original appraisal, this may indicate that appraisals on the policyholder's other scheduled jewelry are equally inaccurate and unreliable. If so, this is a good time to recommend that the other jewelry be appraised by a qualified appraiser, such as a Certified Insurance Appraiser™ in jewelry


Do not automatically go to the original selling jeweler for assessment of damage. Remember he is in the business of selling (rather than repairing) jewelry. If he knows you’ve chosen him to either repair or replace, he will most likely recommend replacement.
With salvage jewelry, get quotes from several jewelers before selling. Jewelers often expect insurers to be an easy mark in this area (see May 2000 IM NEWS) and may take advantage of your lack of jewelry knowledge.

Always have damaged jewelry inspected. Ask for not just a repair estimate but also for a detailed description of the remaining jewelry, and compare this description with the appraisal. Such a comparison may reveal a value far below the insured valuation.
And, finally, about your expert:

• Is s/he a Graduate Gemologist (GG)?
• Is s/he a Certified Insurance Appraiser™ (CIA)?
• Does s/he have an accredited gem lab?


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