February 2012

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

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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

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

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

 

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Whose Diamond?

A high-end jewelry store is robbed in a spectacular well-publicized heist. Now, almost five years later, one of the stolen diamonds turns up. The store and the pawnbroker are locked in a lawsuit over which of them owns it.

Isn’t someone being left out?

In 2007, two well-dressed men arrived at Graff Diamonds Ltd. in a chauffeured Bentley Continental Flying Spur. Once inside the London store, they chatted with staff, then pulled out silver handguns. They left with more than $20 million in jewelry.

None of the gems surfaced for several years. Then in January 2012, the Gemological Institute of America (GIA) in New York City recognized a yellow diamond submitted for appraisal as part of the loot taken from Graff. GIA had originally certified the 16.64 carat diamond stolen from Graff, and they now saw the same diamond recut as a 16.28 carat stone.

The diamond had been submitted to GIA by a Hong Kong pawnbroker, Yau On Co. Graff immediately sued the pawn shop for return of the gem, also asking for costs of the law suit and attorneys’ fees.

The pawnbroker argued that he did not know the diamond was stolen, that he had received full source documentation when he bought the stone, and that it was said to have come from a wealthy person in mainland China. He refused to allow GIA to return the diamond to Graff.

As of this writing, GIA is holding the gem, pending resolution of the dispute by the New York State Supreme Court in Manhattan.

Insurer, hello?

Nowhere in news reports of this case is the insurer mentioned. Surely Graff, a luxury jewelry store with several locations and an international reputation, would be covered by theft insurance. Presumably a claim was made and has been settled.

As insurers know, once a claim is paid, the insured is “made whole.” The lost goods, if they should subsequently turn up, are the property of the insurance company.

As part of claims procedures, insurers should notify major gem labs of stolen gems, with specific descriptive details from the gem certificates. They should also file the necessary ownership documents in the appropriate jurisdiction. If any of the stones turn up, the insurer would be on record as the owner.

For higher-value gems these steps are well worth the effort. It’s likely such gems will be submitted for certification in the future and the labs could check for stolen goods that have been reported. Even with more ordinary gems, if the details of the lost gems are listed with authorities, it’s more likely there will be recoveries.

If gems are recovered, and returned to the insurer, the insurer may agree to sell them back to the insured for the amount paid out in settling the claim. Considering the current market, this outcome would still be a win for Graff, as the price of colored diamonds has gone up considerably since the theft in 2007.

The Graff case is one little instance in the worldwide trade in illegal gems. This diamond traveled at least from London to Hong Kong to New York, and probably other places in between. There are all sorts of merchants willing to trade in stolen gems, willing to not look too deeply into their provenance. There are places to have the gems recut, “labs” that will issue bogus certificates, go-betweens who will “represent the owner.”

What about the pawnbroker who “didn’t know” the diamond was stolen? Did he think he was getting an extraordinary diamond from a naïve seller? Did he suspect it was stolen? Is he the legal owner because he has a bill of sale?

We await news of how this lawsuit is resolved.

FOR AGENTS & UNDERWRITERS

Hong Kong, where the stolen gem turned up, is considered a travelers’ paradise for bargains of all kinds. A tourist might get a “really good deal” there. For all high-priced jewelry purchased during travel, be sure to get a certificate from a reliable lab, such as GIA, AGS or GCAL.

To verify authenticity of a certificate, follow the appropriate link. You will need the report number and the carat weight of the stone.

GIA Report Check
AGS Report Verification
GCAL Certificate Search

For jewelry purchased at pawn shops, flea markets, or other unorthodox venues, be sure to get an appraisal from a trained gemologist (GG, FGA, or equivalent) who has addition training in insurance appraisals. One course offering such additional training is the Certified Insurance Appraiser™ (CIA) course of the Jewelry Insurance Appraisal Institute, Oakland, CA.

FOR ADJUSTERS

Make it a part of your claim procedures to establish your ownership of lost or stolen gems after the settlement. Contact the major labs with gem details, including dimensions, clarity, color, caratage and cut.

Not only very expensive stones, but even relatively ordinary ones, of a carat or more with reasonable color and clarity (and a value of say $10,000), should be reported. This makes recovery more likely.

GIA, AGS and GCAL are the most reliable labs for diamond reports. To verify authenticity of a certificate, follow the appropriate link. You will need the report number and the carat weight of the stone.

GIA Report Check
AGS Report Verification
GCAL Certificate Search

 

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