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trouble insuring chipped stone so that it can be recut

aguera

Rough_Rock
Joined
Oct 20, 2016
Messages
4
My engagement diamond (1.23 ct) got a chip in the girdle a few years ago. State Farm covered it as a total loss and let me keep the stone. (Very nice of them!)

Over the years I've wished that I could wear and enjoy my beautiful stone again. I thought maybe if I wore it in a necklace, in a bezel setting to protect the girdle, it would be safe from further damage.

I found a beautiful necklace with a bezel setting from a well-known jeweler in Texas. The jeweler would be willing to examine the stone to see if they think the setting is a good idea or whether they'd recommend recutting the stone--but only if the stone is insured.

I called my State Farm agent and explained the situation. She said that State Farm won't insure chipped or broken stones.

It doesn't seem like *any* insurer can insure chipped or broken stones.

The jeweler in Texas has not been very helpful. A consultant there said that I should contact an independent appraiser, but what's the point in that, if the stone can't be insured? Local jewelers don't want to appraise my diamond or work on it, either.

I can't possibly be the first person who has ever chipped a diamond... I can't figure out how to proceed. I would be willing to sign a waiver just to have a chance at wearing my diamond again.

Does anybody have advice? img_2142.jpg
 

ringo865

Ideal_Rock
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Feb 14, 2014
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2,368
I hope your jeweler in Texas who is recutting your stone is Brian Gavin.…
 

Karl_K

Ideal_Rock
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I'm confused as why he wants it insured.
It would be impossible to get and there is no insurance that will cover a stone during recutting that I am aware of.
During a recut there are no guarantees and you would have to sign a liability waiver.
 

pyramid

Ideal_Rock
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Nov 10, 2002
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4,607
State Farm covered it as a total loss and let me keep the stone


You already got the money, this is just salvage then and is broken so it would not be insured, it is difficult
in any case to get a loose stone insured for just setting never mind one with damage on.

If you are uncomfortable to take the risk then just set it as is in a pendant.
 

aguera

Rough_Rock
Joined
Oct 20, 2016
Messages
4
Yes, It is Brian Gavin! But they insist they won't work on it unless it is insured.
 

kb1gra

Brilliant_Rock
Joined
Jul 6, 2012
Messages
621
I guess it is too late now but...if you wanted to self-insure, why would you not just tell them "it's insured?"

What are they going to do, ask to see proof of insurance?

Since it is a total loss and you were paid for it, it's already been insured for replacement value, which you already have, so as far as they are concerned, it IS insured. Well, not now that you've told them it isn't. But since you have the cash value of the stone in hand, you can self insure this and probably should have just said it's insured.
 

Diamondz1

Shiny_Rock
Joined
Feb 18, 2015
Messages
142
Aguera, How bizarre - I have a stone a Brian Gavin right now for a recut evaluation on a chipped girdle and I told them that it's not insured. It sounds like setting the stone is what triggers the insurance requirement?

Perhaps you can get your stone insured with Jewelers Mutual to satisfy the setting requirement. They insure my engagement ring which the paperwork says is chipped (I had the chips polished out after buying it but didn't get a new GIA report so, as far as JM is concerned, it's chipped, lol).
 

Karl_K

Ideal_Rock
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Diamondz1|1477055843|4089220 said:
Aguera, How bizarre - I have a stone a Brian Gavin right now for a recut evaluation on a chipped girdle and I told them that it's not insured. It sounds like setting the stone is what triggers the insurance requirement?

Perhaps you can get your stone insured with Jewelers Mutual to satisfy the setting requirement. They insure my engagement ring which the paperwork says is chipped (I had the chips polished out after buying it but didn't get a new GIA report so, as far as JM is concerned, it's chipped, lol).
A small chip in the girdle is a different story than a stone with damage to the extent the insurance company
didn't want it to have it recut.
Honestly if Brian has reservations about cutting it there sounds like it may not be savable.
 

denverappraiser

Ideal_Rock
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8,746
You are insured. It's part of your personal property category of your Statefarm homeowners policy. The problem is that it has zero 'value', so it's mostly an academic sort of question. Is it still called insurance if there's no scenario where it's possible to file a claim?
 

LawmaLlama

Shiny_Rock
Joined
Apr 19, 2016
Messages
376
The advice to get it appraised is correct. Take it to a reputable appraiser to see if the stone as-is, has any salvage value and ask the appraiser to write up a detailed description and the as-is value. This will allow you to then take that report and have it insured for salvage value. This will also protect you to document any residual value it has since you have already been paid for a "total loss."

This should also allow you to have it insured while in transport to/from a jeweler for evaluation on a bezel setting, recut, or otherwise. After reset or recut, you'll need a new updated appraisal.

And as additional info, many jewelry policies do not cover your stone while it is in the hands of the jeweler for repair etc. The jeweler's commercial policy provides that coverage to the jeweler in the event they damage or lose your stone.
 

LawmaLlama

Shiny_Rock
Joined
Apr 19, 2016
Messages
376
And I should add that the salvage value, once appraised, may be below the deductible in your homeowners or renters policy. Thus, you may not need a separate policy just for the stone. You'll need to check the jewelry limits and terms of those policies to be sure that loose stone as salvage is covered.
 

iwantsparkle

Shiny_Rock
Joined
May 25, 2016
Messages
306
Does anyone know - is this the case for ALL stones with chips?

I've seen many antique stones for sale with chips. They are still asking thousands of dollars for them. Is this because of the location of the chip? Just wondering.
 

Alex T

Ideal_Rock
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Oct 24, 2012
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4,981
iwantsparkle|1477076985|4089342 said:
Does anyone know - is this the case for ALL stones with chips?

I've seen many antique stones for sale with chips. They are still asking thousands of dollars for them. Is this because of the location of the chip? Just wondering.
I was wondering the same? I have seen lots of diamonds for sale over the years with chips & flea bites. Is it to do with the durability of the stone due to the nature of the chip i.e. Does the particular chip affect the integrity of the diamond?
 

denverappraiser

Ideal_Rock
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iwantsparkle|1477076985|4089342 said:
Does anyone know - is this the case for ALL stones with chips?

I've seen many antique stones for sale with chips. They are still asking thousands of dollars for them. Is this because of the location of the chip? Just wondering.
When I say no value, I"m referring to the insurance approach to value. They view it as pre-existing damage of a sort that they would cover if it happened on an insured item. That's why they won't bind on them.

Antiques they view slightly differently. 'Wear' is ok. 'Damage' is not. Nicks are usually ok. Chips usually are not. Yeah, I know, it's as clear as mud. In the end, it's up to the underwriter and it's going to have a lot to do with the appraiser.

Sales price is a totally different thing, and asking price is different again.
 

iwantsparkle

Shiny_Rock
Joined
May 25, 2016
Messages
306
denverappraiser|1477089401|4089422 said:
iwantsparkle|1477076985|4089342 said:
Does anyone know - is this the case for ALL stones with chips?

I've seen many antique stones for sale with chips. They are still asking thousands of dollars for them. Is this because of the location of the chip? Just wondering.
When I say no value, I"m referring to the insurance approach to value. They view it as pre-existing damage of a sort that they would cover if it happened on an insured item. That's why they won't bind on them.

Antiques they view slightly differently. 'Wear' is ok. 'Damage' is not. Nicks are usually ok. Chips usually are not. Yeah, I know, it's as clear as mud. In the end, it's up to the underwriter and it's going to have a lot to do with the appraiser.

Sales price is a totally different thing, and asking price is different again.
Thanks!
 

azstonie

Ideal_Rock
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Jul 1, 2014
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3,758
There is a 3 ct OMC stone in my family with a small chip on the girdle. Its been reset over the decades as a ring (semi bezel and also prong-set with prong covering chip) and as a pendant without further damage.

Five jewelers have set it. No one wanted insurance.

I must not understand the question or problem here---rather than re-cutting the diamond couldn't you have it set to cover the spot on the girdle that is chipped?

Maybe this is a can-vs-should situation?
 

diamondseeker2006

Super_Ideal_Rock
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Jan 11, 2006
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55,617
Just have it set locally in a bezel pendant if the bezel will cover the chip. Or try David Klass.
 

Bron357

Ideal_Rock
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Jan 22, 2014
Messages
4,114
I wouldn't bother recutting it if they want insurance, I'm guessing they are worried the chip might have affected the integrity of the stone. I'd just find someone to bezel set it as a pendant. My mum did that with a diamond she badly chipped. The chip has affected the light return but hey, it's better than throwing it out!
 

Karl_K

Ideal_Rock
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Aug 4, 2008
Messages
9,456
Recutting or setting of broken or chipped stones is always a case by case basis.
There can be a lot of damage that is not visible until you get it under
magnification and know what to look for in the diamond.
My guess is that Brian sees something in the diamond that may cause issues with a recut and is being careful.
That the insurance company did not take it and have it recut to recoup some of the money paid paid out
also points in that direction.
Personally I would just ask Brian and see what he says.
 
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