19 replies to this topic

[samiam]

I used to frequent this site approximately four years ago when I was initially shopping for my wife’s engagement ring. Based on the advice I received, I purchased a GIA-certified 1.20 ct., F color, VS2, good/good with a 59% table and a 62% depth for a VERY good price through a jeweler friend of the family. Unfortunately, a couple of weeks ago my wife lost her engagement ring. Yes, she did actually lose it. In fact, she lost it out the window of her car when waving a car to pass her. After realizing it had fallen off her finger, she stopped her car immediately and walked into the middle of the road to look for it. She found the mangled setting with no stone, which means that someone’s tire became much more valuable.

We’re in the process of working through a claim with our insurance company. The replacement service provider is a master gemologist from our local area who has a strong reputation and personality to match. The first stone she showed us was considered a “betterment” (authorized by the insurance company). It was a GIA-certified 1.31 ct., very good/very good with a 58% table and 63% depth. I examined the stone under a loop and a microscope, but wasn’t pleased with what I saw. As a result, the gemologist suggested my wife and I contact our insurance company to check and see if we have enough coverage for an AGS triple-zero rated stone. She explained that GIA has softened its ratings in the last several years, which was apparent based on the GIA book’s statement that a 63% depth now qualifies as “excellent.”

Putting aside the foregoing advice for the moment, she also informed us that there is a “shortage” of high quality stones in the 1.25 to 1.5 ct. range due to De Beers restricting production. Those suppliers who have these stones in inventory are holding onto them until the economy recovers and are pushing lower quality stones (G, SI1, good/good) on buyers because they have more of these quality stones on hand. I checked with the jeweler who originally sold me the ring and he can’t confirm or deny what De Beers has and/or may be doing in regards to inventory. He has some high quality stones in inventory, but not many.

My overall feeling is that I want at least 2-3 stones that I can compare side-by-side before making a decision. Anyone have thoughts on this? How about thoughts on dealing with one’s insurance company?

[barry]

It sounds as if your policy is written in that replacement is done "in like kind" as opposed to a cash out which gives your insurance company the upper hand, not you.

Check the replacement terms of your policy and clarify with your agent as to what you're entitled to.

Insofar as availabilities of 1.25-1.35, F-G color, VS-2/SI-1 clarity there is no shortage.

[samiam]

That's correct. Unfortunately, the cash out is at wholesale value if we don't select a stone from one of the insurance company's approved replacement service dealers. However, if she can't get us a quality stone, then I'll fight with the insurance company to get the appraisal value of the ring.

barry, on Monday, May 31 2010, 07:13 PM, said:

It sounds as if your policy is written in that replacement is done "in like kind" as opposed to a cash out which gives your insurance company the upper hand, not you.

Check the replacement terms of your policy and clarify with your agent as to what you're entitled to.

Insofar as availabilities of 1.25-1.35, F-G color, VS-2/SI-1 clarity there is no shortage.

[barry]

I wish you good luck but it sounds as if your Insurance company has the upper hand here.

63% depth is deep and light performance is sacrificed.

Although depth percentages should NOT be considered in isolation I would cap it in the 62-62.2% area.

Consider Table/depth ranges in the 58-62 area.

Edited by barry, 31 May 2010 - 04:42 PM.

[denverappraiser]

Who is your insurance company?
What is the claim limit on the policy? (that’s probably the amount of your appraisal)
What is the amount they’re agreeing to pay the jeweler before they call it ‘betterment’? (this is what they’re calling ‘wholesale’)
Is the ring itself going to be difficult to replace or is this largely about the center diamond? Has this even been discussed?

The usual terms are that they are agreeing to replace with like kind and quality and, as Barry points out, given no more details than your description this shouldn’t be all that difficult to do. It’s entirely reasonable for them to shop for the best dealer they can to spend their money with but they’re still bound by that ‘like kind and quality’ clause. It will benefit you to read your policy carefully if you haven’t already done so. Most of the big insurers actually have a fairly extensive list of providers on their approved vendors list and you are welcome to shop with whoever you want from that list. They also have arrangements to shop with vendors NOT on their list but they will only agree to pay what they can get the merchandise for from their guys (that's why I asked one of the questions above). Choose your jeweler FIRST, and if you don’t like the one that the insurer is foisting off on you, complain about it NOW, before you even get into looking at stones. If it's one of the big name insurers and your friendly family jeweler isn’t on their list, he/she should really consider getting on it. It’s not usually all that hard and the insurers really do make for a decent referral source. If his prices are as good as you say and he’s got otherwise reasonable policies, they will probably be happy to talk to him.

That said, I have some significant disagreements with the ‘master gemologist’ you’re shopping with. There is no such shortage (just check the database here if you don’t believe me. I find well over a hundred stones for sale). Saying that GIA has become more liberal on cut is preposterous. Prior to the current system, they had no cut grade at all and the current system doesn’t use table/depth percentages in isolation. It’s kind of hard to find a 63% depth that’ll get a GIA excellent although it's technically possible but then, it’s pretty easy to find a 59%/62% that won’t (and shouldn’t). There are some valid criticisms of the GIA cut grading system but, in my opinion, this isn't one of them. The stone you lost could be, at best, very good under their cut grading system because of the symmetry and polish. AGS’s rules are completely different but they don’t use table/depth either.

You are very unlikely to win a fight that you are entitled to the appraised value in cash, even if you end up shopping elsewhere. Again, read the policy but if that's that it said, this deal would already be done.

Neil

Edited by denverappraiser, 31 May 2010 - 04:57 PM.

[samiam]

All good points. I'm going to call the insurance company tomorrow. My policy states that they have the right to pay "the full amount of our cost to replace the item with one substantially identical to the item lost or damaged." This language is pretty vague in favor of the insurance company, but I'm stuck with it.

State Farm is the insurance company.
I'll find out the policy limit.
I'll find out the amount they'll pay the jeweler before calling it a "betterment."
The setting is easy to replace - 4 prong platinum Tiffany-style setting.

The bottom line as far as I'm concerned is that the insurance company's jeweler had better provide me with some inventory to look at or I'm going to tell the insurance company that I want a different jeweler from their list. I haven't seen any evidence of a shortage either, but wanted to check with you guys first.

What I'd like is a stone that is as close to matching my original stone as physically possible. Beyond the measurements, the stone simply needs to look good - period. The 1.31 ct stone she showed my wife and me simply didn't, so as far as I'm concerned, it isn't a "betterment."

[barry]

Good luck and let us know what happens.

[denverappraiser]

That’s not vague at all. They’re agreeing to pay THEIR guys to replace it or pay someone else (or you) the same amount that it would cost them to do so if you refuse. Actually, that’s even pretty fair. The key concept here is ‘substantially identical’. This is going to boil down to the appraisal you submitted when you bound the policy as this is, in effect, the purchase order for the replacement. What THEY mean by betterment is that it meets all and exceeds at least one of the specifications you’ve provided (weight/clarity/color/polish/symmetry. Depth% and table% are not qualitative rankings). That said, the replacement jeweler should be happy to find you an alternative or two that also meets the specs and that are more to your liking.

If your jeweler friend is running something that with a straight face could be called a jewelry store, he should get himself on the State Farm list. With a lot of the companies he would have already received a call to try and make a deal since they were the original seller but SF is well attached to their ‘approved vendor’ system and if he’s not on it, he’s out of the loop. If you’re in or near a big city, there’s probably dozens on the list within a reasonable distance of you. The claims adjuster may have a preference for the one they sent you to but they’ll have a list of alternatives if you ask.

By the way, I disagree that a 63% depth should be a deal killer on a Good to Very Good stone. The fact that you didn't like it is a deal killer, but not the depth percentage. That may just be a heavy girdle for example.

Neil

Edited by denverappraiser, 31 May 2010 - 05:47 PM.

[samiam]

Thanks for the additional information. I guess it all boils down to whether I'm happy with the stone, which I wasn't with the one stone the replacement service offered. My original jeweler has been in the business for 40 years and is probably already on some insurance company's replacement list. I wonder whether he could get on State Farm's list in time to handle my claim. Regardless, I have a list of the other replacement service jewelers from State Farm in my area (D.C.) They are:

Mervis
Princess
Esterman Estate
Maryland Exchange
Stoneworks
Robert Limon

There are more, but those are the ones I have handy. I went with the one originally suggested by State Farm (who I didn't list to keep from getting into a spat with her later on), but so far I'm not impressed with what she can offer. I'm inclined to give her another chance (i.e., bring me 2-3 stones of the same quality as the one my wife lost that don't have flaws under the table - a small prongable inclusion is okay, as that's what the original stone had). If she can't do this within a week or so, I'm going to ask for a replacement.

My gut tells me that a highly-skilled jeweler should have the stone I want in inventory, or can get it (and others like it for comparison purposes) without much trouble. Citing alleged "shortages" and blaming DeBeers as excuses for not being able to do so doesn't smell right to me.

[davidelevi]

samiam, on Tuesday, Jun 1 2010, 02:17 AM, said:

[snip]
What I'd like is a stone that is as close to matching my original stone as physically possible. Beyond the measurements, the stone simply needs to look good - period. The 1.31 ct stone she showed my wife and me simply didn't, so as far as I'm concerned, it isn't a "betterment."

The issue is that to them it's 10% larger (and possibly - just possibly - a little costlier). Unfortunately, that's what they would argue no matter what you, I or anyone else on this board feels about quality not being captured by a GIA report, particularly when the report does not include a cut grade.

I'd be inclined to ask to talk with another dealer, given the undiluted cr*p on De Beers and the diamond market this first one has given you. Probably she feels the loss adjuster is giving her not enough to cover her work and hassle in finding a decent stone. In which case she should get out of the insurance company's list of suppliers.

Best of luck!

[denverappraiser]

Most jewelers don’t carry a whole lot in inventory for purely logistical and financial reasons. A selection of a few each of everything that your customers might want is fantastically expensive. Although theoretically possible, the result of someone trying to do this would be unacceptably high prices because of the costs of capital, security, etc. that have to be built into the prices. The solution is that basically everything is done on a special order basis at nearly every store. This is a pretty mainstream item and your odds of finding it in stock at a jeweler you want to work with go up compared to someone who was looking for, say, a 2 carat pear, but I wouldn't recommend holding this against them. Pick a jeweler that communicates well with you and who you want to do business with and then expect to need to special order the actual stone.

One of the tricky problems for the insurance replacement business is that there are costs to the jeweler associated with bringing you in a selection to choose from in the form of shipping, insurance, etc. The insurance company does not consider these costs to be part of the original loss even though it’s part of their costs in making the insured (that’s you) whole again. The jewelers are paid a commission to put the deal together and these costs come straight off the top. The result is a strong incentive NOT to do exactly what you’re asking for but rather to get in one stone and talk you into taking it or at least to do the shopping using certificates and raw data without actually inspecting stones at all. If you don't buy the jeweler absorbs it all. I fully concede that this is their problem, not yours, but it’s helpful to understand where the other guy is coming from.

Neil

[samiam]

That might explain why the jeweler with whom I've been dealing only wants to bring in one stone. She is an independent master gemologist, not a retail outlet, and doesn't want to absorb the costs of having multiple stones "checked out" from her suppliers. I spoke with the insurance company briefly this morning and expressed my concerns. The insurance company allegedly wants me to be a satisfied customer, so it has set me up with another jeweler who can send me the GIA certificates in advance and can give me more than one stone to review at a time.

denverappraiser, on Tuesday, Jun 1 2010, 09:36 AM, said:

Most jewelers don’t carry a whole lot in inventory for purely logistical and financial reasons. A selection of a few each of everything that your customers might want is fantastically expensive. Although theoretically possible, the result of someone trying to do this would be unacceptably high prices because of the costs of capital, security, etc. that have to be built into the prices. The solution is that basically everything is done on a special order basis at nearly every store. This is a pretty mainstream item and your odds of finding it in stock at a jeweler you want to work with go up compared to someone who was looking for, say, a 2 carat pear, but I wouldn't recommend holding this against them. Pick a jeweler that communicates well with you and who you want to do business with and then expect to need to special order the actual stone.

One of the tricky problems for the insurance replacement business is that there are costs to the jeweler associated with bringing you in a selection to choose from in the form of shipping, insurance, etc. The insurance company does not consider these costs to be part of the original loss even though it’s part of their costs in making the insured (that’s you) whole again. The jewelers are paid a commission to put the deal together and these costs come straight off the top. The result is a strong incentive NOT to do exactly what you’re asking for but rather to get in one stone and talk you into taking it or at least to do the shopping using certificates and raw data without actually inspecting stones at all. If you don't buy the jeweler absorbs it all. I fully concede that this is their problem, not yours, but it’s helpful to understand where the other guy is coming from.

Neil

[barry]

If this new Jeweler is not local to you, request photo's of the diamond(s) you're interested in.

[jan]

samiam, on Monday, May 31 2010, 09:17 PM, said:

All good points. I'm going to call the insurance company tomorrow. My policy states that they have the right to pay "the full amount of our cost to replace the item with one substantially identical to the item lost or damaged." This language is pretty vague in favor of the insurance company, but I'm stuck with it.

State Farm is the insurance company.
I'll find out the policy limit.
I'll find out the amount they'll pay the jeweler before calling it a "betterment."
The setting is easy to replace - 4 prong platinum Tiffany-style setting.

The bottom line as far as I'm concerned is that the insurance company's jeweler had better provide me with some inventory to look at or I'm going to tell the insurance company that I want a different jeweler from their list. I haven't seen any evidence of a shortage either, but wanted to check with you guys first.

What I'd like is a stone that is as close to matching my original stone as physically possible. Beyond the measurements, the stone simply needs to look good - period. The 1.31 ct stone she showed my wife and me simply didn't, so as far as I'm concerned, it isn't a "betterment."

We are a State Farm replacement jeweler as well. If you would like to contact me, I can tell you what we can do for you.


Jan

[samiam]

Sorry for neglecting this thread, but the new replacement service jeweler finally acquired two stones for us to examine. He sent us the certs and we looked at them in person today. He has them on loan until mid-week, so we need to make a decision.

Thoughts on the attached certs?

Attached Thumbnails

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[davidelevi]

Well, everything seems to be checking out with respect to the numbers. Which are not enough... my advice is to go and see the stones. There are no major red flags on either, though it would be interesting to understand and know why they both have very good cut grades rather than excellent.

[samiam]

The stones both looked nice in person. We're partial to the one with the good/good polish & symmetry. Why? Because I could see the crystal through a loop and have some concern that a jeweler might also when/if we decide to upgrade it to another stone many years in the future.

davidelevi, on Monday, Jun 14 2010, 11:50 AM, said:

Well, everything seems to be checking out with respect to the numbers. Which are not enough... my advice is to go and see the stones. There are no major red flags on either, though it would be interesting to understand and know why they both have very good cut grades rather than excellent.

[davidelevi]

I'm sorry - I can't understand your point. The one with a crystal is the one with good/good. You say you are partial to it (which to me means you like it) because of the crystal, yet you are worried about the fact that it can be seen by you - and by extension by a jeweler - with a loupe. Any SI1 inclusions will be easily located by a professional with a loupe; indeed that is what SI1 inclusions are... If the stone is eye-clean it will be valued and priced differently than one that is not, and you should expect any jeweller to do that.

[samiam]

We ended up going with the VG/VG stone rather than the G/G, even though the latter had less flaws depicted on the GIA certificate diagram. The crystal in the VG/VG stone was very small, and even I can't be sure that I saw it through the loupe when I examined it.

I appreciate everyone's input on this decision. It certainly wasn't an easy one, but my wife and I feel better now that we've finally made a decision and the beautiful engagement ring I gave her will be back on her finger by next week. I daresay that years from now, we'll probably even forget that she lost the original one.

[davidelevi]

I'm glad this has been resolved to your - and hopefully your wife's - satisfaction. Pictures, pretty please?