8 replies to this topic

[MellowCat]

I hope these image links worked...

Just wanted to share my diamond story w/you guys and throw some questions out and get your feedback. Sorry it's so long, but I'm kind of excited. : )

My mother has been dead for 30 years. Had a bunch of her jewelry sitting in a box that long, mostly junk. I took 3 of the rings in that box to the jeweler just to "see" if any of the diamonds were real, even though I highly doubted it. Well I learned one WAS real, and according to the jeweler, a very nice diamond. Pretty cool, huh?

I had it set in a new mounting, and added the annivesary bands as well. Photos below. They don't do the ring justice. It is a 1.43 carat stone.

I was told by the jeweler that there was a chip in the diamond. I located it as well in their loupe. It doesn't appear to detract from the beauty; I can't see it w/out magnification. There are definitely inclusions, but when I look thru the loupe, they don't seem very bad to my eyes. Nothing black for sure. Nothing noticeable to the naked eye. How much will this chip devalue the stone, do you think? It doesn't appear to threaten to cause any future damage either, but I'm figuring that's a pretty big blow to its value.

Since reading up on diamonds, I am now regretting getting it mounted before having it looked at or "certified" by a lab. I'm about to have it appraised. The jeweler is going to do the appraisal for "free", which I hear isn't always the best way. Since he only sold me the setting and not the big diamond, do you think the appraisal (insurance replacement) will still be kind of "bunk?" They are insisting upon an appraisal and telling me I *must* get it insured. Said it would prolly be worth in the $10,000.00 range. I don't know about that, but....without having it looked at by a lab, how am I to get the thorough information on my diamond that everyone else seems to have (pavilion depth, angle, clarity, symmetry, etc?). Is it simply too late for that information to be obtainable? What if I were to sell it (not likely)? Would the lack of this info be detrimental? Will the appraisal be adequate in lieu of a "certificate?" Is there a big advantage to having on over the other, or both?

What is "scintillation?" I have an idea in my head that it is how much the light dances around, but that's a wild guess. This ring seems to "scintillate" a lot; lots of colors of the prism jump out.

I'm very proud of my treasure, but wonder about these other issues. Look at the photos and tell me what you think of my ring. Please ignore my "macro'd" hand - I really am NOT 80 years old as the pic would indicate. LOL.



[url="http://michaelgaston.com/images/ringB.jpg"]My Webpage[/url]

[url="http://michaelgaston.com/images/ringA.jpg"]My Webpage[/url]

[url="http://michaelgaston.com/images/ringC.jpg"]My Webpage[/url]

[ben]

Hi, I noticed no one had answered your "long post". Probably not the best way to solicit replies :-) but I figured I'd take a stab.

You did not mention whether you intend to sell this ring or keep it. If you intend to keep it, your only need for an appraisal is for insurance purposes, and that is assuming you are indeed interested in insuring it. While it is a good idea, it is definitely not *required*. It is totally up to you. Many people do not insure their jewelry separately; and many others count on their renter's or homeowner's insurance to cover it (though be sure to study your policy carefully if you plan to rely on this).

If you intend to sell it, you definitely are correct that you should have had the diamond certified by an independent lab such as GIA prior to getting it mounted. I'm surprised your jeweler didn't suggest this. The reason is simply due to the size of the stone; anything > 1ct will usually be > $5,000 which is simply too much money for anyone to spend without independent verification of the stone by itself.

If you're bent on getting an appraisal (whether for selling or keeping), one solution I might suggest is to get the ring appraised as a whole piece by an independent appraiser (not a jeweler). When you work with the appraiser, explain to him/her the reason for the appraisal. And once you have all the documentation, be sure to fully disclose it to any potential seller.

You mentioned in your post you had 3 stones, and that one was real diamond. What were the other ones? Are you sure they weren't real diamonds? :-)

[denverappraiser]

There are several reasons that your insurance company is requiring you to get an appraisal.

1) It provides independent witness that the item exists, that it’s in your possession and that you claim to own it, at least as of the date of inspection.

2) It defines the parameters for replacement in the case of a loss. If you file a claim, they will replace the missing piece with another of ‘like kind and quality’. By requiring you to produce an appraisal up front, YOU are defining what will constitute an acceptable replacement.

3) It documents the condition as of a particular date that is prior to the beginning of the insurance contract.

4) It helps them to set their premiums. The bottom line number on the appraisal will be the maximum risk to the insurance company under your contract. Don’t confuse this with the expected amount you will receive in the case of a loss. These numbers can vary considerably.

An appraisal by a jewelry store can easily meet all of these requirements and there is no particular conflict of interest in having them provide it. Many jewelry stores have well qualified and capable appraisers on staff for exactly this kind of assignment. The reason that people like ‘independent’ appraisers for new purchase type appraisals is that there is a conflict of interest involved if the appraiser is a participant in the transaction and there is a serious worry among both buyers and sellers that if they are a competitive seller their advice may be less than unbiased. Neither of these seems to apply to your situation.

The competence of the jeweler to perform the appraisal will depend entirely on the jeweler, their training, their tools and the amount of effort they are willing to put into it. In the long run, the price of the appraisal is not likely to be a very important issue and a well done appraisal improves the value of your insurance considerably because of items #2 and #4 above. Most people don’t do their best work for free.

If you aren’t planning on selling, it is almost always a bad plan to pull the stone out of the setting and send it to a lab. It’s true that better measurements can be done on an unmounted stone but, for this type of assignment, it is rarely worth the risk of additional damage to either the diamond or the mounting and it increases the price of the appraisal considerably. A good appraiser can tell you quite a lot without the need to do this.

[ben]

Quote

An appraisal by a jewelry store can easily meet all of these requirements and there is no particular conflict of interest in having them provide it.

Don't the various insurance companies give a "cut" to the referring jeweler for the policy premium amount of each policy? If so, there would be a slight conflict of interest if the premium is proportional the appraisal value.

[MellowCat]

ben, on Monday, Dec 19 2005, 11:11 PM, said:

Hi, I noticed no one had answered your "long post". Probably not the best way to solicit replies :-) but I figured I'd take a stab.

You did not mention whether you intend to sell this ring or keep it. If you intend to keep it, your only need for an appraisal is for insurance purposes, and that is assuming you are indeed interested in insuring it. While it is a good idea, it is definitely not *required*. It is totally up to you. Many people do not insure their jewelry separately; and many others count on their renter's or homeowner's insurance to cover it (though be sure to study your policy carefully if you plan to rely on this).

If you intend to sell it, you definitely are correct that you should have had the diamond certified by an independent lab such as GIA prior to getting it mounted. I'm surprised your jeweler didn't suggest this. The reason is simply due to the size of the stone; anything > 1ct will usually be > $5,000 which is simply too much money for anyone to spend without independent verification of the stone by itself.

If you're bent on getting an appraisal (whether for selling or keeping), one solution I might suggest is to get the ring appraised as a whole piece by an independent appraiser (not a jeweler). When you work with the appraiser, explain to him/her the reason for the appraisal. And once you have all the documentation, be sure to fully disclose it to any potential seller.

You mentioned in your post you had 3 stones, and that one was real diamond. What were the other ones? Are you sure they weren't real diamonds? :-)

Hi, I noticed no one had answered your "long post". Probably not the best way to solicit replies :-) but I figured I'd take a stab.

**Thanks for replying.**

You did not mention whether you intend to sell this ring or keep it. If you intend to keep it, your only need for an appraisal is for insurance purposes, and that is assuming you are indeed interested in insuring it. While it is a good idea, it is definitely not *required*. It is totally up to you. Many people do not insure their jewelry separately; and many others count on their renter's or homeowner's insurance to cover it (though be sure to study your policy carefully if you plan to rely on this).

**I plan to keep it. Since I last posted, I have had it appraised for insurance purposes by an independent appraiser. I'm currently checking out different insurance carriers. It's worth considerably more than I anticipated. **

If you intend to sell it, you definitely are correct that you should have had the diamond certified by an independent lab such as GIA prior to getting it mounted. I'm surprised your jeweler didn't suggest this. The reason is simply due to the size of the stone; anything > 1ct will usually be > $5,000 which is simply too much money for anyone to spend without independent verification of the stone by itself.

**That's kind of what I thought. My jeweler was probably more interested in selling me the new setting than anything else. I regret this, but since I have no intentions of selling it, it isn't that big of a deal. I primarily want the details a lab gives vs. an appraiser to satisfy my own curiosity. They offered me an insurance-replacement appraisal themselves, but their "computer is down" and they don't think it will working until Saturday. This will be about over 2 weeks and their "computers are down?!" It may or may not be true, but I don't see why they can't just buy a new one instead of fix an old one. I'm TRYING to give them the benefit of the doubt, but...They've been putting me off in increments for quite a while. Can you see any red flags with this scenario?

If you're bent on getting an appraisal (whether for selling or keeping), one solution I might suggest is to get the ring appraised as a whole piece by an independent appraiser (not a jeweler). When you work with the appraiser, explain to him/her the reason for the appraisal. And once you have all the documentation, be sure to fully disclose it to any potential seller.

**See previous reply***

You mentioned in your post you had 3 stones, and that one was real diamond. What were the other ones? Are you sure they weren't real diamonds? :-)

**The jeweler didn't say what the other ones were, just "fake." I feel lucky ONE of them was the real deal. ***

Again, thanks for your reply.

[MellowCat]

denverappraiser, on Tuesday, Dec 20 2005, 09:31 AM, said:

There are several reasons that your insurance company is requiring you to get an appraisal.

1) It provides independent witness that the item exists, that it’s in your possession and that you claim to own it, at least as of the date of inspection.

2) It defines the parameters for replacement in the case of a loss. If you file a claim, they will replace the missing piece with another of ‘like kind and quality’. By requiring you to produce an appraisal up front, YOU are defining what will constitute an acceptable replacement.

3) It documents the condition as of a particular date that is prior to the beginning of the insurance contract.

4) It helps them to set their premiums. The bottom line number on the appraisal will be the maximum risk to the insurance company under your contract. Don’t confuse this with the expected amount you will receive in the case of a loss. These numbers can vary considerably.

An appraisal by a jewelry store can easily meet all of these requirements and there is no particular conflict of interest in having them provide it. Many jewelry stores have well qualified and capable appraisers on staff for exactly this kind of assignment. The reason that people like ‘independent’ appraisers for new purchase type appraisals is that there is a conflict of interest involved if the appraiser is a participant in the transaction and there is a serious worry among both buyers and sellers that if they are a competitive seller their advice may be less than unbiased. Neither of these seems to apply to your situation.

The competence of the jeweler to perform the appraisal will depend entirely on the jeweler, their training, their tools and the amount of effort they are willing to put into it. In the long run, the price of the appraisal is not likely to be a very important issue and a well done appraisal improves the value of your insurance considerably because of items #2 and #4 above. Most people don’t do their best work for free.

If you aren’t planning on selling, it is almost always a bad plan to pull the stone out of the setting and send it to a lab. It’s true that better measurements can be done on an unmounted stone but, for this type of assignment, it is rarely worth the risk of additional damage to either the diamond or the mounting and it increases the price of the appraisal considerably. A good appraiser can tell you quite a lot without the need to do this.

***Thanks for your reply***

There are several reasons that your insurance company is requiring you to get an appraisal.

**My insurance company isn't requiring it; the jeweler kept "highly encouraging" me to get one for insurance replacement. They were rather adamant. Now that the ring has been appraised, I understand why.****

1) It provides independent witness that the item exists, that it’s in your possession and that you claim to own it, at least as of the date of inspection.

2) It defines the parameters for replacement in the case of a loss. If you file a claim, they will replace the missing piece with another of ‘like kind and quality’. By requiring you to produce an appraisal up front, YOU are defining what will constitute an acceptable replacement.

3) It documents the condition as of a particular date that is prior to the beginning of the insurance contract.

4) It helps them to set their premiums. The bottom line number on the appraisal will be the maximum risk to the insurance company under your contract. Don’t confuse this with the expected amount you will receive in the case of a loss. These numbers can vary considerably.

***This is what I wish the insurance companies would divulge up front. I can't get any of the ones I've spoken to to answer my questions to my satisfaction. I deal with health insurance every day and I know what slime-balls they really are when it comes time to pay a claim. I don't expect jewelery insurance to be any different.****

An appraisal by a jewelry store can easily meet all of these requirements and there is no particular conflict of interest in having them provide it. Many jewelry stores have well qualified and capable appraisers on staff for exactly this kind of assignment. The reason that people like ‘independent’ appraisers for new purchase type appraisals is that there is a conflict of interest involved if the appraiser is a participant in the transaction and there is a serious worry among both buyers and sellers that if they are a competitive seller their advice may be less than unbiased. Neither of these seems to apply to your situation.

**I thought that myself, at least in my particular case. If you will see my reply to Ben, I'm still unsure that their appraisal will be worth much. They have said they can take a pictures of my ring and do the appraisal from those. I don't see how a proper appraisal can be done with photographs and not the real thing. I guess since it's "free" they may not do a very good one. ????****

The competence of the jeweler to perform the appraisal will depend entirely on the jeweler, their training, their tools and the amount of effort they are willing to put into it. In the long run, the price of the appraisal is not likely to be a very important issue and a well done appraisal improves the value of your insurance considerably because of items #2 and #4 above. Most people don’t do their best work for free.

**See above***

If you aren’t planning on selling, it is almost always a bad plan to pull the stone out of the setting and send it to a lab. It’s true that better measurements can be done on an unmounted stone but, for this type of assignment, it is rarely worth the risk of additional damage to either the diamond or the mounting and it increases the price of the appraisal considerably. A good appraiser can tell you quite a lot without the need to do this.

**I agree. I wouldn't strip the stone out after just having it mounted in a new setting! I am surprised that until reading this forum, I had never even considered that damange might occur to the stone just by remounting it, removing it, or whatever. It has been quite a valuable learning experience. I thank you for your comments.

[denverappraiser]

Mellowcat,

Ok, now I’m confused. For an appraisal to be useful, it must contain information that is both true and useful. If your purpose is something other than binding an insurance policy, an insurance replacement appraisal probably isn’t going to be very useful. What are you hoping to learn? Did the appraiser ask you this question? Put another way, when you say “What is it worth?’, what do you mean by this? What it would cost to replace? What you should expect to cost if you saw it in a store? What you could sell it for? How it compares to other, superficially similar items? Something else entirely?

Obviously I have no way of knowing if the information contained in your report is correct or not. The fact that it’s prepared by a retailer does not, by definition, make it bunk but I must admit, the fact that it’s ‘free’ is a bad sign. The apparent fact that the appraiser didn’t discuss any of this with you doesn’t bode well either.

Ben,

No, the insurance companies don’t pay a commission to jewelers for referring them business. Insurance is a highly regulated business and this is actually illegal. Jewelers Mutual is the only one I know of that markets through jewelry stores and the benefit the store gets from the deal is that they get attached to the account as the first place option for where the client gets sent in the case of a replacement. The customer is under no obligation to go there but, if and when they have a loss, the company will provide a list of places where they recommend you to go to get it replaced. The jeweler who sent them the original client will be at the top of the list followed by neighborhood stores that have JM commercial policies.

Most of the other companies don’t even do this. They send their replacement customers to stores where they have pre-negotiated a discount price and who do a good job of keeping clients happy through the replacement process. Unhappy customers cancel their homeowners policies, which is where the real money is.

[ben]

Denverappraiser, thanks for the explanation. I always learn much from your messages. Enjoy your holidays!

[MellowCat]

denverappraiser, on Tuesday, Dec 20 2005, 10:10 PM, said:

Mellowcat,

Ok, now I’m confused. For an appraisal to be useful, it must contain information that is both true and useful. If your purpose is something other than binding an insurance policy, an insurance replacement appraisal probably isn’t going to be very useful. What are you hoping to learn? Did the appraiser ask you this question? Put another way, when you say “What is it worth?’, what do you mean by this? What it would cost to replace? What you should expect to cost if you saw it in a store? What you could sell it for? How it compares to other, superficially similar items? Something else entirely?

Obviously I have no way of knowing if the information contained in your report is correct or not. The fact that it’s prepared by a retailer does not, by definition, make it bunk but I must admit, the fact that it’s ‘free’ is a bad sign. The apparent fact that the appraiser didn’t discuss any of this with you doesn’t bode well either.

Ben,

No, the insurance companies don’t pay a commission to jewelers for referring them business. Insurance is a highly regulated business and this is actually illegal. Jewelers Mutual is the only one I know of that markets through jewelry stores and the benefit the store gets from the deal is that they get attached to the account as the first place option for where the client gets sent in the case of a replacement. The customer is under no obligation to go there but, if and when they have a loss, the company will provide a list of places where they recommend you to go to get it replaced. The jeweler who sent them the original client will be at the top of the list followed by neighborhood stores that have JM commercial policies.

Most of the other companies don’t even do this. They send their replacement customers to stores where they have pre-negotiated a discount price and who do a good job of keeping clients happy through the replacement process. Unhappy customers cancel their homeowners policies, which is where the real money is.

Mellowcat,

Ok, now I’m confused. For an appraisal to be useful, it must contain information that is both true and useful. If your purpose is something other than binding an insurance policy, an insurance replacement appraisal probably isn’t going to be very useful. What are you hoping to learn? Did the appraiser ask you this question? Put another way, when you say “What is it worth?’, what do you mean by this? What it would cost to replace? What you should expect to cost if you saw it in a store? What you could sell it for? How it compares to other, superficially similar items? Something else entirely?

I sought the independent appraiser for insurance coverage/replacement value, so that's the type of appraisal he did. He didn't ask me any other questions such as those you listed.

Obviously I have no way of knowing if the information contained in your report is correct or not. The fact that it’s prepared by a retailer does not, by definition, make it bunk but I must admit, the fact that it’s ‘free’ is a bad sign. The apparent fact that the appraiser didn’t discuss any of this with you doesn’t bode well either.

As I stated, the appraisal was not done by the retailer. The retailer has been putting off my "free" appraisal due to a "computer problem." Now they're saying it may be fixed by Saturday. I'm going to pursue getting the free appraisal from the retailer well, because it's free and I was promised this "service." How useful theirs will be is no longer much of an issue because I have an independent appraisal now, though I'm very curious as to how the two appraisals will compare since they are both supposed to be "insurance replacement value" appraisals. I'll let you guys know once the retailer does his appraisal. Thanks.