Jewellery insurance - jewellery valuation scams

Call me Jack

Well - a new client has asked us to value and set a diamond for her. It is quite a nice pink diamond which she bought from a direct source at what we would consider a keen price since the diamond came from the Argyl mine in Australia. Anyway, that isn't the interesting bit - what is interesting is that before finding us she went to her local jeweller and asked them to, firstly, value to stone, and then for a quote to set it (she didn't get as far as the quote though).

The local jeweller sent the stone off to their (we assume) NAG approved valuer who kept it for nearly a month while they attempted to put a value on the stone (apparently the most experienced valuer was ill was the excuse). When they did eventually manage to come back with some sort of value, it was verbal and somewhere between £1000 and £10,000. Nothing like leaving yourself a margin for error is there?? Indeed the actual written valuation seems to not note the diamond's source and values the stone at £12000. She was charged £50 for this. Needless to say, the customer wasn't very happy, which is why she came to us.

She told us this story, and also that during the attempt to value to stone they had called another shop which she had previously used to make a few jewellery repairs. They use small sticky labels on their packaging, just the sort that are really useful to secure small packages, which is exactly what she had re-used it for on the diamond package (called a wrap) to secure the diamond so it didn't fall out. Apparently, the shop had put 2 and 2 together and remembered that she had mentioned a loose pink diamond a couple of weeks earlier so they called her to let her know - the worst part of this story is what they told her.

I seems the valuation company had got someone (assume one of the valuers, a lady actually) to call the shop whose sticker was on the package and said that they had bought this particular diamond from them and would like to buy another - how much would that cost? Of course, the bewildered shop assistant had absolutely no idea what she was talking about and, naturally, asked how much she had paid for that one ... to which the reply was "no actually, lets start again, I'm a valuer and want to get a retail value for this diamond for insurance, so how much would you sell one like it for" . Bearing in mind this is a cold call to someone asking very specific questions about a reasonably rare stone, the shop found this quite irregular and probably reminded her that she was the valuer.

So what are these valuers up to? Its hard to say isn't it. Clearly they had absolutely no idea what they were doing and, after a month of fumbling, were clutching at straws. The point is - valuations on jewellery are like valuing houses. Many factors come into play, and you have to really know your market to make a good appraisal of the worth of an object. For this you need some experience and some training. Like I have pointed out in other posts, the training to become a jewellery appraiser isn't as vigorous as say, the Royal Institute of Chartered Surveyors (since we were likening it to property valuations). Most valuations are easy and have easily accessible data (like a makers mark, a year and and assay stamp of metal and approximate carat weight of stones) which makes them easy to find a replacement cost - with a couple of months doing the job a junior assistant could potentially do this. Some are not as straight forward and require more specialist knowledge and it is these that end up totally bamboozaling the registered valuers. Problem is, they don't admit their inadequacies and undervalue or overvalue the item causing major problems should it go missing or get damaged.

But is it too much trouble to ask the owner of the piece a few questions instead of calling round all and sundry and making yourself look like a fool? It didn't take us long to put a value on the stone, actually about 5 minutes since it had a clear certificate and a reference number which when we accessed it told us everything we needed to know. We also asked the client where it came from, which she was happy to tell us, that she got it from Australia - so there is only one place for a possible source, the Argyl mine. We have dealt with these types of diamonds before and this one was good quality and was worth towards the upper end of the very wide margin the first valuer had put on it verbally.

In this case, the diamond has been seriously overvalued to the tune of around 30% which means that year on year the customer could be paying 30% more than they need to for premiums and, indeed, would unlikely to be offered a cash settlement for the diamond at £12000 despite paying the premiums for that amount.

All seems like common sense to me - watch out, there are professional scammers about taking your money and putting you at risk of insurance losses through their own lack of knowledge.

The real jewellery insurance con

Call me Jack.

The long con; a term all of us should be familiar with.  For those who aren't, it means someone is prepared to invest a lot of time to con you in the long run.  The more I write this blog, the more I feel we're all part of a big long con called insurance; whether it be home insurance, car insurance, business insurance, life insurance ... the biggest con of all is jewellery insurance.

I've just had another example of this from a couple who came in today.  They were burgled last year and she lost all her jewellery.  Amongst other things that were special to her were two strings of pearls and a diamond eternity ring.  These items were insured by Barclays home insurance - the valuers were iVal, who this time did a good job in reaching a fair valuation of the claim.  Their insurance values were £3200 for a long string of pearls, around 40 inches long; £2200 for a double row necklace around 18 inches with a gold clasp; and £2500 for a channel set eternity ring with diamonds.  There were some other pieces as well, and they were fairly valued too reaching a total of around £9500 for the claim.

So Jack.  What's the problem?  Where's the con?  You ask.  Hmmmm ... where indeed.  this time, its in the replacements.

Barclays preferred jeweller was actually an internet based jewellery sales site.  They brought a selection of jewellery to the client, who chose replacements from these with the help and advice of the agent from the internet jewellers.  The only thing was, none of it was the same as what she had, so really she wasn't at all happy with it - but she had no choice but to take it under the terms of her contract.  There were no other alternatives made available.

They came to see us on recommendation to see if we could help with another piece still outstanding from the robbery, something which the preferred jeweller nor any other jeweller could help with.  We currently have that in hand.  While they were in the shop, they told us their jewellery insurance nightmare and showed us the other pieces.

To be honest - the long replacement string of pearls were on the money at £3200 - they were good quality akoya pearls ... but they were very poorly matched so they looked like a row of dull plastic balls.  OK, so they were expensive, but this is rather like having a bad Van Gogh - priceless but awful to look at.  As far as we can tell, her original strand was a long 60 inch large white freshwater pearl necklace - cheaper individual pearls, but much better matched, whiter, more uniform and of course the correct replacement.  The other pearls were well overpriced - we would have charged less than a thousand for better examples.  Both strings of pearls were strung hideously - no wonder the poor lady didn't want to wear them ... but now she was fobbed off with them and there was nothing she could do.  The eternity ring was OK, but the diamonds were again poorly matched.  On a later visit she told us that the ring should have been a much wider gold band with bigger diamonds, so this perhaps wasn't ever going to be replaced for the amount valued. The rest of the jewellery was supplied in the same way, again these were reasonable but not the quality of her stolen jewellery or suitable replacements.

Basically, the whole robbery experience had been gruesome for the couple and she was clearly very upset and not at all pleased with the replacements.  It could have been that the jewellery she lost was actually worth far far more than that of the replacements and the quality difference is clear to her - so the valuations were too low.  But we'll never know.

So why does this happen?  

Because the loss adjuster from the insurance company is not a jewellery expert.  Indeed, it would seem that the preferred jeweller has no idea either ... or they were just getting rid of some stuff they had lying around for a few years on the unsuspecting client when she was at a low ebb after the robbery.  This does rather beg the question why people are forced to use vouchers for a specific jewellers if that jeweller hasn't got what they want at all?  Its not what we're led to believe by the insurers in their advertising.  

Here's the horrible truth - if your small print states you have to use the insurance companies preferred jeweller, then there's no way out.  You can ask to use another jeweller or for a cash settlement, but they will only give you a proportion of your claim based on reductions for wear and tear and what they can get by buying in bulk from their preferred jeweller.  This isn't usually enough for you to replace like for like or old for new if you chose this cash settlement which, in our experience can be as little as one third of the estimated value of the vouchers.  Legally, there is no further recourse ... or is there?   This is a subject for another blog I think, but for now ...

Shame on you Barclays for using an online jewellery supplier and not a high quality high street jewellers and forcing your clients to accept things they don't want!

UK Jewellery Scammers - time to name and shame

Call me Jack.  I'm a bespoke jeweller in a small town in the UK where I have a shop in the high street.  We are one of the few remaining jewellery manufacturers and we specialize in pearls and rare precious and semi-precious stones and have over 30 years experience in making and valuation of all jewellery.  Additionally, my partner is considered one of the foremost authorities in the field of jewellery history.

So, what prompted me to write this blog?  Its not actually to promote us in any way and the mere fact that I want to remain anonymous is because what I'm about to reveal to the unsuspecting British public would likely get me blacklisted from every jewellery association in the country;  a bit like the "masked magician", if anyone has seen that.

But I don't feel this should be kept under wraps any longer.  Not that I should care what they think - we don't base our business on ripping off our customers, so it probably wouldn't matter that much - still, I like to be anonymous - it gives me a kind of ghostly leverage over those who seek to swindle and perform atrocious acts of daylight robbery.

Thats enough of me.  So what am I talking about?  Jewellery of course, in the more general sense, moreover knowledge and jargon - the science that blinds the public into buying expensive stuff that is way overpriced from high street chains, independent shops, e-shops or even market traders just because the guy behind the counter knows a bit more about the jargon and hides behind a facade of trade secrets that make you, the customer, totally vulnerable to being taken in and sold goods that are simply not worth 5% of what you have paid for them.  

Even huge, reputable (we all assume they are) companies get involved in this terrible mis-selling ... though I suppose I can't be sure they really understand that they are at the root of these dreadful acts as they themselves may be taken in - but I am sure they know a good deal when they get one and they are benefitting from your misfortune at the hands of unscrupulous rip off merchants in posh suits and very expensive shop fits.

These are the "rogue traders" of the jewellery profession and I'm going to name and shame if I find evidence of deceit.  Watch this space!!