June 2012

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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Diamonds — Out of Africa  . . .
or out of a lab?

One of the world’s largest gem-grading labs recently announced that it received a parcel with hundreds of synthetic diamonds that were being passed off as naturals.

Alarm immediately shot through the gem and jewelry industry: How many lab-made gems have not been “caught” and are out in the marketplace being sold—and priced—as natural diamonds?

That question also impacts jewelry insurers, since lab-made diamonds have a substantially lower value than mined diamonds.

Diamond synthesis has been in the works for over 60 years. The earliest attempts produced diamond dust suitable only for use on cutting and grinding tools. Later efforts created gem-quality stones, but the time and electricity required made them more expensive than mined diamonds.

A decade ago labs were using HPHT (high pressure high temperature) to turn out yellow diamonds, which could be further treated to adjust their color, but colorless synthetic diamonds were still not possible. A different technology, chemical vapor dispersion, changed the game.


Chemical vapor deposition (CVD) passes a cloud of carbon gas over diamond “seeds” in a heated vacuum chamber. The diamond literally grows as carbon crystallizes on top of the seed. The process produces colorless gem-quality diamond that is extremely difficult to distinguish from mined diamond.

The diamonds that prompted the International Gemological Institute’s industry alert were all CVD synthesized. The diamonds were all of good color and clarity, with inclusions strikingly similar to the kind found in natural (mined) diamonds. Observations through a loupe or microscope, tools found in the average gem lab, could not recognize the stones as lab-made.

Gemological laboratories are continuously being challenged by rapidly evolving technologies. The IGI gemologists turned to DiamondPlus and DiamondView to examine the stones. These sophisticated instruments, designed by DeBeers specifically to distinguish between natural and synthetic gems, are priced beyond the reach of most appraisers and jewelry retailers. Generally, only large gem labs can afford them. These expert tools revealed the fluorescence and phosphorescence typical of CVD diamonds. The gems also showed striations characteristic of the CVD process.

Labs in Antwerp, Mumbai and China all received synthetic diamonds about the same time. Because the stones all had similar characteristics, they may have had similar origin.

The IGI alert noted one other important fact: none of the diamonds was laser-inscribed.


The World Federation of Diamond Bourses and similar international organizations require members to identify lab-made diamonds. The U.S. Federal Trade Commission guidelines also require disclosure. A laser inscription on the diamond’s girdle, though easily polished off, is the best way of assuring that this disclosure makes its way all through the selling chain. For example, Gemesis inscribes all its lab-created diamonds over one-quarter carat with the Gemesis name and the stone’s certificate number, and all the company’s promotional materials clearly identify its stones as lab-made.

Either these stones were never inscribed or the inscriptions had been removed. Apparently someone intended to fraudulently pass them off as natural. The question is, Who?

The diamonds originated with the manufacturer, were sold to a diamond company, and were purchased by the dealer who submitted them to IGI for grading. The dealer was under the impression they were natural diamonds, and he says they were priced as such. The dealer, not having the necessary equipment, cannot distinguish natural from lab-made stones, so he may be the first victim. Or perhaps the diamonds had already changed hands several times, which would not be unusual, and there are more victims.

IGI suspects that a volume of unidentified synthetic diamonds is already making its way to the marketplace. The jewelry industry is doing its best to prevent this, as such large-scale fraud undermines consumer confidence in the diamond market as a whole.

Consumers have no easy ways to determine the quality of a diamond or whether it originates in the ground or a lab. It is the responsibility of the consumer—and the insurer—to be sure diamonds come with reliable appraisals and certificates.


Synthetic diamond is real diamond (not imitation, like CZ), but its value is far less than for a natural diamond of similar quality.
A synthetic diamond should always be so described on the appraisal — not just on the sales receipt, and not just on a diamond certificate.  The appraisal should explicitly state either than the gem is natural or that it is synthetic.

Labs can afford the instruments needed to distinguish natural diamonds from their less valuable counterparts that are lab-grown. All diamonds of significant value should have a certificate from a reliable lab. We recommend the following labs and suggest that you use these links to verify reports you receive.

GIA Report Check
AGS Report Verification
GCAL Certificate Search

As synthesizing technologies evolve and become more prevalent, ever more sophisticated equipment is needed to distinguish natural from synthetic, and swindlers come up with new ways to fool the equipment. We may be approaching a time when we are able to insure only diamonds certified by reliable labs.


Most important, know that synthetic diamond is worth significantly less than natural diamond. You may want to review our earlier issue on insuring tips for synthetic diamonds.

If less expensive lab-made stones start slipping in as naturals, the potential for overpayment on claims is enormous.

Check the appraisal and other documents for words that mean synthetic, such as lab-grown, man-made, lab-made, created, or cultured. If there are terms you don’t understand, it may be worthwhile to consult a jewelry insurance expert.

Also look for brand names, such as Gemesis, Chatham, etc. Reputable makers of synthetic diamonds attach their names to their products. Recognizing these names, or working with a jewelry expert who does, could save you tens of thousands of dollars on a claim.

In replacing a diamond of high value, never assume that the stone is natural simply because the appraisal doesn’t say it’s synthetic. Use every means possible to determine whether it is natural or lab-made.

For a damaged diamond, get a lab report. By doing so you will not only verify the quality of the stone, but you may learn that there is no damage. For instance, a diamond claimed to be chipped may turn out to be an indented natural and not damaged at all.

Carefully read all documents on file. Insurers have overpaid claims by thousands of dollars because they missed — or thought unimportant — a piece of crucial information on the appraisal, such as the mention of color and clarity treatments.

For a lost diamond, try to get the selling jeweler’s records, as well as the sales receipt and appraisal. The jeweler may not be forthcoming with this information, but it is worth the effort for high-priced jewelry, especially if there is any question as to whether the stone is natural or synthetic.

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