August 2010

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

Subscribe to
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

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

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

Growing 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

 

We'll be glad to notify you when the Jewelry Insurance Issues is available each month. Sign up for your FREE SUBSCRIPTION to Jewelry Insurance Issues.

Visit the rest of the JCRS site:  www.jcrs.com

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

With suits or hairstyles, cut is just a matter of fashion. A dated haircut might be an embarrassment. But with diamonds, cut affects valuation.

We've said many times that cut accounts for about half the value of a diamond. A look at the history of diamond cutting will show why this is so.

Gem cutters in the Middle Ages had very basic tools, so gems had very basic shapes. Diamond workers would cleave the stone along its natural planes, using a hammer-and-chisel approach, making the sides as smooth as possible. Since diamonds typically grow in 8-sided crystals, what resulted was the “point cut” diamond.

Early Diamond Cuts

Point Cut

Old Mine Cut

Old Single Cut


Such diamonds would look dull by today's standards. They'd have none of the sparkle and brilliance we associate with diamonds. In fact the table cut, developed in the 15th century, is said to have made diamonds set in jewelry appear black-but this was OK since at that time diamond was valued for its extreme hardness. For jewelry, colored gems such as ruby and sapphire were far more popular-but then again, all red stones were called rubies and all blue ones were called sapphires!

Technology still had a long way to go before cutters could take advantage of diamond's clarity and transparency to show off the stone's beauty.


Old Mine Cut

Old Mine Cut diamond ring

Old European Cut

Old European Cut diamond ring


Old Mine cut diamonds, popular in the 1700s, were basically rounded off squares. Diamonds were rounded by bruting-rubbing two diamonds against each other-a process that might take weeks of work on a single diamond. Later this procedure was mechanized. Old European, popular in the 1800's, was much more round and is a forerunner of the modern Round Brilliant cut.

By the late 19th century, changes were happening quickly. Mechanical saws allowed cutting large rough into smaller pieces. This meant that, instead of just grinding away any excess, cutters could saw the rough neatly into two pieces to produce two diamonds.


Mathematicians developed gauges for measuring precise angles. The science of optics began exploring the influence of cutting angles on the diamond's appearance.

Jewelers recognized that “scientific cutting” could produce a diamond that reflected light back to the eye from many surfaces, greatly increasing the gem's sparkle and brilliance. In a well-cut diamond, light is refracted back through the top of the gem to the eye. In a poorly cut stone, light is lost and the diamond has dark spots.

Traditionally, gemstones were worked to keep the diamond large, to minimize waste. But the new scientific analyses revealed that, to produce a diamond with brilliance and fire, a lot of stone has to be cut away.

In this illustration, the left image shows two well-proportioned gems cut from diamond rough. The right image shows how the same piece of rough could yield two larger stones (greater carat weight), but they would be poorly proportioned and much less attractive.

Today the ideal proportions for Round Brilliant Cut diamonds have been standardized. A diagram and description of this cut appear on the reverse of the JISO 78/79 jewelry appraisal form.

Valuation of “old” and “new”

Old-cut diamonds, such as Old European Cut and Old Mine Cut tend to look dark and “heavy.” These gems are less desirable and have a lower valuation than a well-cut diamond of comparable weight.

Important Note: It's not only old diamonds that are cut to preserve weight.

Bargains! Unfortunately, even in contemporary jewelry a large percentage of diamonds are still poorly proportioned, because carat weight is what consumers value. “Bargain” prices and comparisons based on carat weight alone lead many customers to pay more than the jewelry is worth.

Princess Cut The Princess Cut is a popular modern cut that preserves carat weight. A major shortcoming of this squarish shape is that the corners of the stone are vulnerable to chipping. Some insurers consider this vulnerability an inherent vice and do not insure princess cut stones unless the setting protects the corners.

“Old” Is In Not all old-cut gems are old. As early styles become more popular, contemporary jewelry will mimic them. The same caveats apply here as with all fads: what is expensive when it's in fashion can quickly drop in value when it becomes passé.

In Summation: It is always crucial for the insurer, and the insured, to have an appraisal detailing the cut proportions (as well as the other 4 Cs: clarity, color and carat weight). It bears repeating:

Up to 50% of a diamond's valuation
is based on cut.

FOR AGENTS & UNDERWRITERS

For diamond jewelry, be sure to have a detailed appraisal that includes cut information. Preferably, the appraisal is on JISO 78/79 form and is prepared by a Certified Insurance Appraiser™.

Some older styles, such as Old Mine Cut and Old European Cut diamonds, are available today from internet retailers. They appeal to those interested in an antique look.

Insuring older pieces, such as antique jewelry or inherited jewelry, calls for extra precautions. Cut quality, styles that are out of fashion, and imitation diamond mixed in with quality gems (often done in earlier jewelry) can affect valuation. Antique jewelry should be appraised by a jeweler familiar with such jewelry and its market.

FOR ADJUSTERS

When pricing a replacement, give the replacing jeweler all descriptive information from the appraisal and other documents. Do not give the valuation. The replacement price should be based on the quality of the jewelry (as described on the appraisal and lab report), not on your limit of liability or on the original purchase price.

Compare the description on the gem lab report with the description on the appraisal. Compare the valuation with the purchase price, if available. When a large settlement is at issue, it could be worthwhile to consult a jewelry insurance professional to help determine the true quality and value of the jewelry and avoid a large overpayment

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 is natural or synthetic (and to be sure its qualities are as stated in the appraisal).

©2000-2017, JCRS Inland Marine Solutions, Inc. All Rights Reserved. www.jcrs.com

Subscribe to Jewelry Insurance Issues

 

Manual JIBNA