June 2004

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

Growing 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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What Is A Good Appraisal?

Which of these are good appraisals?

Click each appraisal to see an enlargement

Was that a trick question? Yes.
The answer is: NONE of them.
And that usually leads to settlement overpayments.

Let's have a closer look. These are real-world appraisals, typical of those received every day by agents and underwriters and used by adjusters to settle claims. We scored them for completeness using ACORD 18, Jewelry Appraisal & Claim Evaluation.

Yellow highlighting shows missing information that is crucial to accurate valuation. (Click on a graphic to view a full-sized form in a new window. Close the new window to return to the story.)

Appraisal 1

Appraisal 1

Appraisal 1
ACORD 18 scoring

The orderly presentation of information is misleading. This appraisal doesn't discuss mounting at all, and doesn't even say what metal is used.

The words next to "shape and cut" (round brilliant, round full, tapered baguette) are all terms for shape only. Cut information, describing the stone's precise geometric proportions (table %, crown angle, pavilion %--highlighted on ACORD 18), is simply not given. Cut is one of the "4 Cs" of gems, along with color, clarity and carat weight. In diamonds, cut accounts for fully half the gem's value. A reliable valuation cannot be made without this information.

A little fudging appears in the description of clarity as SI3 ("slightly imperfect-3") There is no such designation in standard GIA grading. This grade actually translates to I1 ("imperfect-1"), which means inclusions are visible to the naked eye.

Appraisal 2

Appraisal 2

Appraisal 2
ACORD 18 scoring

This succinct appraisal leaves out crucial cut and mounting information.

Notice also the paragraph that follows the appraiser's signature. It begins by certifying the truth and correctness of the appraisal, but then undercuts that assurance by stating "We assume no liability with respect to any action that may be taken on the basis of this appraisal." It may as well say: Don't base your claim settlement on this appraisal and valuation.

A professional appraiser should, in fact, stand behind his word and expertise. For a more trustworthy warrantee of truth, see the paragraph above the appraiser's signature on the ACORD 78/79 appraisal.

Appraisal 3

Appraisal 3

Appraisal 3
ACORD 18 scoring

In addition to all the missing information highlighted on ACORD 18, this one isn't even called an appraisal — and the title says it all. The no-liability clause, above the appraiser's signature, emphasizes again that this is not really an important document. It is, after all, just for insurance.

Appraisal 4

Appraisal 4

Appraisal 4
ACORD 18 scoring

This is a so-called "narrative" appraisal, where all information is packed into a dense paragraph. ACORD 18 shows that information is missing on cut, setting and mounting.

Since this jewelry was the subject of a damage claim, rather than a total loss, other appraisal problems became apparent. The appraisal describes the emerald as yellow green, but examination of the damaged stone showed it to be bluish green. In addition, tone and saturation were omitted. These discrepancies are not trivial. The major determinant for an emerald's value is its color, and the descriptive language for color stones is standardized and quite precise.

Based on the replacement cost submitted by the original seller/ appraiser, the insurer settled the claim for $49,000. JCRS, consulted afterwards to deal with the salvage, found that the emerald could have been replaced for $8,279.

The original appraisal was grossly inflated. In settling the claim the adjuster made two mistakes: 1) he accepted the appraisal at face value, and 2) he accepted the selling jeweler's cost of replacement. If, instead, he had consulted a disinterested jewelry professional to verify valuation before settling the claim, he could have avoided the $40,000 overpayment.

Appraisal 5

Appraisal 5

Appraisal 5
ACORD 18 scoring

This is a formal and impressive-looking document, patterned after the Diamond Reports produced by such respected labs as the Gemological Institute of America. This, however, is NOT from a respected lab. It leaves out the same crucial information omitted on handwritten appraisals from mom-and-pop jewelers.

To cap it off, the valuation is also grossly inflated. Appraisals with inflated valuations are often used as sales tools, to convince purchasers they are getting bargains.


Unfortunately, these inadequacies are typical. A decade ago JCRS completed a survey of appraisals from 21 insurance companies. Only one percent of the appraisals studied mentioned cut, the single quality most important in valuing diamonds. Only 11 percent gave manufacturer; just 6 percent listed manufacturing technique. Four fifths of the appraisals were prepared by jewelers with no formal gemological training.

Today, insurers are seeing appraisals with exactly the same problems. What has changed in ten years?

What's changed is that ACORD has adopted standards for jewelry appraisals. Insurers need not continue accepting any inadequate appraisal a jeweler puts out.

There are also Jewelry Insurance Workshops to train agents, underwriters and adjusters in how to analyze jewelry appraisals, avoid fraud and reduce settlement costs.


Recommend that your policyholders submit ACORD 78/79 appraisals. This guarantees that the jewelry was inspected by a graduate gemologist who is a Certified Insurance Appraiser™ and that all necessary descriptive information appears on the appraisal.

Your second preference should be ACORD 805, a Detailed Sales Receipt.

Insist on a second appraisal for all jewelry valued at $25,000 or more. This in itself lessens the risk of being taken in by an inflated appraisal supplied by the seller. If the first appraisal was not on ACORD 78/79, this one should be.


If you are not working with an ACORD 78/79 appraisal or an ACORD 805 Sales Receipt, use ACORD 18 to analyze the data you have from the existing appraisal and other documents.

Always have damaged jewelry examined by an impartial jeweler — preferably an expert working on your behalf — to verify truth of the appraisal descriptions and valuation.

Rely on your own jewelry expert to estimate cost of repair or replacement. Do not blindly accept the bid of the selling jeweler.


©2000-2018, JCRS Inland Marine Solutions, Inc. All Rights Reserved. www.jcrs.com

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