March 2007

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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Blood Diamonds —
Are You Insuring Them?

The movie "Blood Diamond" brought to popular attention a desperate situation in Africa: Insurgents are profiting from diamond mining and masses of people are being maimed, killed and displaced. Do U.S. jewelry buyers and insurers have a role in this?

Long before they reach a jeweler's showcase, diamonds are a form of currency." They back international loans, pay debts, pay bribes, buy arms," remarked a member of the Diamond High Council in Antwerp, the world's diamond trade center. In an underground market diamonds are easier to move around than currency and they can get you anything.

Sierra Leone"Blood diamonds" or "conflict diamonds" are those mined in a war zone and sold through illegal channels to finance an insurgent or invading army's war efforts. Sometimes both sides in a civil war finance their battles with diamonds. It's a bloody business, where access to the diamonds motivates atrocities beyond the wars' general terror and slaughter.

The role of illegal diamonds in supporting such wars has been surfacing from time to time since the early 1990s. One New York Post article declared, "That dazzling diamond necklace you buy for that special someone at a swank Fifth Avenue jewelry store may be funding the activities of a cannibal gang in Sierra Leone." Human rights groups work to alert consumers, and some recommend consumers boycott diamonds.

But the Leonardo DiCaprio movie made the biggest splash in public awareness. Though shaped as a love-and-politics story, with a upbeat ending, the film did reveal something of the pattern of illegal diamond trading and did show some of the violence that the black market supports. It also suggested how the complicity — and profits — of the legal diamond industry make it all possible.   

The Kimberley Process

The diamond industry, concerned about the victims of the diamond-supported conflicts, as well as about the effect of publicity on its own image and profits, looked for a way to prevent conflict diamonds from entering the mainstream rough diamond market.  The Kimberley Process Certification Scheme is the industry's plan to accomplish this.

A country participating in the Kimberly Process ensures that

More than 40 countries, including the United States, have signed on as participants.

Since the scheme's implementation in 2003, supporters say, it has cut into the illegal trade significantly. However, it is essentially self-enforced. Critics call it a move in the right direction but say that buying and selling diamond rough is a secretive, highly competitive and highly profitable business. Without impartial monitoring, abuses will continue.

Identifying a Diamond's Origin

Many gems carry characteristics that betray their origin. A valuable Burmese ruby, for example, gets its distinctive color from minerals in the area where it was formed and mined. A trained gemologist can recognize the ruby's origin.
With diamond it's not possible to tell where the gem was mined. Diamonds were formed under extreme heat and pressure deep in the earth's mantel, well beyond the influence of local geology. They were brought to the surface by deep volcanic eruptions that occurred millions of years ago.

There's no way to determine a diamond's country of origin by examining the stone. If it traveled via the diamond black market, if it was smuggled from a conflict zone, if it was traded for arms along the way, a gemologist cannot tell.

The consumer has no way to verify the "clean" origin of a diamond. He must take the word of the retailer, who in turn must rely on the honesty of everyone in the supply chain.

What About Diamond Boycotts?

Are jewelry buyers financing violence and killing? Would boycotting diamonds help? Not really. As abhorrent as the consequences of illicit trade are, the majority of diamonds (99%, according to the World Diamond Council) come through legitimate channels.

More than half the world's diamond supply originates in Africa, and revenues from diamond mining have contributed to improved education and healthcare in several African countries. "If there is a boycott of diamonds," said Nelson Mandela, "the economies of Botswana and Namibia will collapse."

In conclusion, we quote the head of a leading gem lab: "To be sure, there are many truly fine jewelers and scrupulously honest jewelry business people. They're just harder to find. The phony "Sales," the deliberately inflated grading, inflated value reports and inflated appraisals, the lack of product knowledge, the lack of financial opportunity in professional retail sales staff, will continue to erode consumer confidence in diamonds and fine jewelry — not conflict diamonds."


Canadian diamonds are sometimes advertised as an alternative to conflict diamonds. Although this can be persuasive marketing, it does not make the diamond more valuable. A diamond's value depends on its qualities, which should be detailed on the appraisal.

When insuring diamond jewelry, ask for a descriptive appraisal on JISO 78/79, prepared by a graduate gemologist who is a Certified Insurance Appraiser (CIA)™.


Ideally, the appraisal on file will contain a complete description of the piece.

If you are not working with a JISO 78/79 appraisal or a JISO 805 sales receipt, use JISO 18 to analyze the data you have from the existing appraisal and other documents. An insurer's expert working on your behalf can help supply more information about valuation.

Brand name information may prove useful, since some companies and sellers are known for the quality of their merchandise.

Always have damaged jewelry examined by an impartial jeweler 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.


On February 4, federal agents arrested two men on charges of smuggling illicit rough diamond into the country. The tip-off happened when one of the men approached an undercover agent at the American Gem Trade Association’s GemFair, saying he had diamond rough for sale and was expecting another shipment.

At their Tuscon hotel room, the two men sold the undercover agent a seven-carat uncut diamond for $15,000. Agents then searched the hotel room and found 11,000 carats of uncut diamond, apparently brought into the U.S. in violation of the 2003 Clean Diamond Trade Act.


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