Poll about damage during setting

[denverappraiser]

Pricescope consumers,

Recently there have been lots of threads about breakage risk during setting or loss of the stone afterwards and who should assume responsibility for this. Clearly this is an area of concern for both consumers and jewelers. What’s a fair policy for the jewelers that protects both their interests and the their customers?


Your comments will be very helpful for jewelers who are struggling with this issue.

Neil Beaty
GG(GIA) ISA NAJA
Independent Appraisals in Denver

 

[PhillipSchmidt]

Any thing can be set in almost any way, given time.

Stones dangerously close to breakage need special treatment.

The problem is not with diamonds.

Sometimes diamonds can break. It is almost unthinkable in round brilliants over 10pt and I am hard on diamonds.

Square diamonds can break pretty easily but not because of the way they are cut but because of the way they are set.

Insurance on stones $ = Level of care needed

 

[fire&ice]

I don''t think the setter should have any responsiblity if the setting or diamond did not come from his store. If the stone is problematic, refuse the work.

 

[belle]

if the stone was not purchased from the jeweler setting the stone, i think the consumer should share some of the cost required to insure against damage. i feel a percentage of the value of the stone plus the standard setting fee is fair.
i am curious however, from your perspective neil, how should the value of the stone be determined in this case?

 

[strmrdr]

My setter covers damage to most diamonds.
It is what he does all day sets diamonds for the trade and a few consumers.
If there is a high risk of breakage then he will work something out before proceding.

With most gemstones he has 2 options.
Lower setting charge and he doesnt cover it.
Higher setting charge and he does.

In talking with him he hasnt damaged a round diamond in many years and its rare for anything else to be damaged.
He has refused to set some princess cut stones and some gemstones because of duribility issues.

 

[denverappraiser]

Belle,

I''m not sure. I guess I would suggest starting with an agreed value at the time of take in. For recently purchased stones, actual cost comes to mind. Replacing the stone with something comparable from that store also comes to mind although this opens up the usual insurance type issues about what constitutes ''like kind and quality''. For stones that the customer has owned for a while some sort of an appraisal would be helpful. Do you have a suggestion?

fire & ice,

I completely forgot that as a choice on my poll.

I agree it should have been listed but I''m not all that big on the policy. Most setters are far better able to assess the risks associated with a particular job than their consumers are. They always have the accept/refuse option but it seems like there is a grey area where they will be willing to accept at some appropriate price but otherwise refuse because they are unwilling to assume the risk in exchange for the available fee. Many stores simply refuse because they are unwilling to have this conversation with the customers while have no policy in place at all and deal with potential problems as they arise. It seems like there should be a compromise that meets everyones requirements without anyone feeling cheated.

Phillip,

I absolutely agree that this is a much worse problem for non-diamond setting jobs. Fancy shaped emeralds come to mind. Do you think the setter should assume breakage risk on all jobs that they accept? Should the setting fee be different depending on whether this risk is included? *IF* a setter damages a stone or a mounting where they agreed to take liability, how should it be resolved?

Neil Beaty
GG(GIA) ISA NAJA
Independent Appraisals in Denver

 

[solange]

I think the issue of possible damage should be discussed in advance and an agreement arranged before the setter accepts the job. If the stone was purchased by the vendor who is setting it perhaps he should accept responsibility.
Also, would the owner''s insurance company cover this damage? If not, then the setter and the customer should agree in advance. If it is a stone with a problem and the risk of damage is high, the customer should be warned in advance of this possibility and the charge should be higher.
If a stone is lost after setting, this would be a matter for the customer''s insurance company to determine.
Perhaps the setter should determine in advance whether the customer has insurance before accepting the job.

 

[1stdiamondbuy]

I think a professional jeweler should guarantee their work. If they aren''t comfortable with the integrity of the stone, don''t take the business. I have a hard time accepting that people won''t take accountability for their work. I would think they would be able to get insurance for this type of work and spread the cost of that insurance over the work that they do. I see the whole "no accountability" thing as a ploy by local jewelers to try to convince you to buy from them instead of buying online.

 

[PhillipSchmidt]

Niel,

It would be nice if it were one way or the other but the case of breaking and who is liable, there is no onus, but one that is at a loss.

It seems a bit much too add a breakage risk to a consumers worries, so whatever work it takes has to be done.

Not much of an answer I know.

Phillip

 

[Kaleigh]

If a jeweler takes in a stone and agrees to set it, he should be responsible for any damage that occures to the stone. If the stone looks like it may present a problem, then refuse to take it in.

 

[PhillipSchmidt]

I re-read your question.

If you agree to take responsibilty, and if you are dealing with a diamond way out of your usable budget and you get hit with a cost like that - your out of business.

You can''t even dream of doing a job like without negotiation over possible outcomes. Doors locked - no interuptions, etc, etc.

I must admit, I have at times left all negotions till delivery.

 

[denverappraiser]

Date: 6/30/2005 12:13:27 PM
Author: kaleigh
If a jeweler takes in a stone and agrees to set it, he should be responsible for any damage that occures to the stone. If the stone looks like it may present a problem, then refuse to take it in.

Kaleigh,

Is it fair for a jeweler to charge more in situations where they feel they are accpeting a higher risk? Alternatively, should they give a discount for situations where their risk is low?

Neil Beaty
GG(GIA) ISA NAJA
Independent Appraisals in Denver

 

[Kaleigh]

I think it''s ok for the jeweler to say, hey this stone may be a problem to set. I''ll do it for you but I need to charge extra. But for a low risk no discount is needed, IMHO.

 

[Kaili]

If a setter agrees to take the job, promises the service, and the customer is paying for the job, I think the job should be completed with no damage. If I take my computer in to have a new drive installed and the technician accepts the job, I do not expect the trained technician to break the drive. If he does, he replaces it. I know we are talking about a great deal more money with diamonds, but I feel like it is the same premise. We go to a setter because it is his/ her job to know how to set stones without damage. That is why I don''t try to do it myself.

I''m sure there are extenuating circumstances such as a high risk stone, but it is the customer''s job to disclose the weakness and up to the educated setter to make a decision. He/ she can warn the customer of the high risk and then decide whether or not to proceed. For a high risk stone, if the customer instructs the setter to go ahead in light of the risk, I would have the customer sign something stating that they understand the risk and want to proceed anyway.

If I buy a setting from someone, I absolutely expect them to set the diamond. I think it is reasonble to pay a standard setting fee if I did not buy the diamond from them. Not all diamonds are purchased. Many times they are handed down or given as gifts. I don''t think it is reasonable for a jeweler to say that they will only set their own stones if they are selling semi mounts or settings separately.

 

[Kaili]

Feydakin...
I didn''t know that. Wow! Just another imbalance in the work world. Kind of like teachers only making bare minimum and athletes being paid millions.... but that''s a subject for another thread

 

[FireGoddess]

Speaking solely from a consumer's point of view, as I am one....I fully expect that if I buy my stone from you, and you set it into a ring, it is your responsibility to deliver it to me in the same condition that I bought it - unchipped, unbroken. If you break it during setting, it is 100% your responsibility to replace my stone with a new one of like kind.

Here's where the jewelers won't like me - if you agree to set my stone, which I did not buy from you, I also expect that if YOU break it, or chip it, you are responsible for either (A) replacing the stone, or, more likely/fair (B) submitting an insurance claim to replace it. Unless there is already some severe defect with the stone that would make it highly likely to be damaged during setting, then you break it, you fix it. That's just the way I feel about it. I could have taken it to another jeweler who may not have chipped it, and still have my stone. You may not think it's fair, but I don't think it's fair for me to bring in a perfectly good stone, have it broken by someone, and then have to absorb the repercussions myself. I didn't break it, did I?? I absolutely know accidents happen...and I feel that's what insurance is for. If I lose or break the stone, my insurance covers it. If you break the stone, your insurance should cover it. I repeat - the caveat being that if the stone is high risk, a disclaimer should be discussed upfront.

I may get flamed for saying this, but that's my take on the situation.

ETA: I forgot to mention what I voted - if I buy the stone from you, there should be no setting fee. If I did not buy the stone from you, a setting fee is fine, with higher risk stones costing more.

 

[FireGoddess]

Date: 6/30/2005 1:28:02 PM
Author: crankydave

Date: 6/30/2005 1:22:14 PM
Author: FireGoddess
(B) submitting an insurance claim to replace it.

We cannot buy this insurance.

Dave

REALLY???? I had no idea. That kinda sucks...

In that case, I don''t know what to say, because I completely understand that it''s ridiculous to take on a setting job that could, in the best case scenario, only make you a few dollars, but in the worst case scenario, cost you an awful lot.

 

[Michael_E]

Date: 6/30/2005 12:52:57 PM
Author: Kaili
If a setter agrees to take the job, promises the service, and the customer is paying for the job, I think the job should be completed with no damage.

Kaili,
No one ever plans on a stone being damaged during setting and everyone, including the jeweler, feels the same way that you do. Because of this, it is important to be able to say , "NO", when asked to set something that is questionable.

If someone brings a stone to me to be set into a mounting that I will be making and it looks like there will be a problem, then I just say, " Nope, can''t do this one". If I think that it won''t be a problem and I accept the work, then I accept the risk. This puts me in the position of not doing certain things like setting apatite, thinnly cut opals or emeralds. It just isn''t worth the headache when you know that you''ve got a 50% chance of messing it up. Even if the customer accepts responsibility, if the stone gets damaged, you are still left with a damaged reputation, so why even consider it ? Diamonds are generally no big deal since they are pretty much bullet proof and the more expensive they are, the better their quality and cutting. Even if they have a high price tag, the risk is so small as to be non-existent.

In all, I agree with Kaili. The jeweler will bear the responsibility of any job that they accept...even if there is some prior agreement. You just have to be picky about what you accept.

 

[strmrdr]

Date: 6/30/2005 12:58:38 PM
Author: Feydakin
You do realize that most computer techs make FAR more money than your average bench jeweler though, don''t you??

Not around here they dont.
Cant go much lower than techs are getting in this area.

 

[denverappraiser]

This is a great discussion.

I think everyone agrees that the best case is for the setter (or their employer) to assume responsibility for damage and that this issue should be discussed at the time the job is accepted. The real question seems to be deciding what is a fair price for assuming this risk and how should it be charged. Consumers would like it to be free, jewelers would like to be paid. In the classic jewelry store model, it’s part of the cost of the stone, the mounting or both. Now it’s either part of the setting fee or it gets passed on to the consumer in the fine print. It’s a competitive world and the folks with the fine print can be quite a bit cheaper than the ones who take care of everything. The people who sell loose diamonds will NEVER cover damage done by some 3rd party jeweler that they know nothing about. I don’t blame them - I wouldn’t either. The vast majority of individual insurance policies will not cover this type of claim and the ones that do come back on the jeweler for it. Every setter assesses the risk of every job as part of their strategy for deciding how to approach the task. The risk is not zero and it’s different for different jobs. Usually it’s so low that they don’t put much thought into it but each must have a threshold of what they will and will not do. Personally, it strikes me as reasonable for this threshold to move based upon the setters assessment of the risks vs. the amount they are being paid and that it is reasonable to offer customers options beyond accept/decline although I certainly understand why this would be seen as a ripoff by consumers.

Neil Beaty
GG(GIA) ISA NAJA
Independent Appraisals in Denver

 

[Regular Guy]

Date: 6/30/2005 1:29:52 PM
Author: FireGoddess

Date: 6/30/2005 1:28:02 PM
Author: crankydave

Date: 6/30/2005 1:22:14 PM
Author: FireGoddess
(B) submitting an insurance claim to replace it.

We cannot buy this insurance.

Dave

REALLY???? I had no idea. That kinda sucks...

In that case, I don''t know what to say, because I completely understand that it''s ridiculous to take on a setting job that could, in the best case scenario, only make you a few dollars, but in the worst case scenario, cost you an awful lot.

Interesting discussion. Sympathetic with Fire Goddess. From the original set of options, I agree with b & c.

Makes me think, though, of a certain type of carpet salesman. Their pitch can be....if you lay down carpet, there''s going to be seams. The difference between our competition and us is that they won''t tell you that, and we will.

As a consumer, what to make of that? Is that a carpet provider I can trust, or is he incompetent, and they have a rap to make you feel Ok about bad work.

Makes me think having someone like an appraiser than has some actual experience with a range of providers can provide a useful benefit, so you can tell what''s what. A good handshake and shingle may not be sufficient.

Also, though, the bit about valuation in advance of work seems both important and sensitive, with respect to starting the work. Even though both the customer and provider may agree the chances are small for there being a problem (making the intention to make this a point of discussion awkward)...I wonder if anyone on board here has a standard approach to this?

Best,

 

[1stdiamondbuy]

I think the lack of availability for insurance of loose stones is one of the single biggest negative in online diamond buying. More of the vendors that sell online should be trying to setup arrangements like the one Bluenile has with Chubb. There are a lot of reasons to want to get it set locally ... being able to view the diamond and get it appraised during the return period, seeing settings, having local support for loose diamonds or sizing issues, etc. But to have to keep the loose diamond with no insurance in that period and not having insurance during the setting process is high risk. I know of people who won''t buy online for that issue alone. I''m surprised that vendors can''t find insurance companies to insure loose stones.

I also think that if chipping a diamond during setting is as rare as it sounds on here, the setters could essentially self-insure. If they charged an extra $25 or so for each setting and turned away the very risky stones, if they chipped 1 out of 300, they could replace a $7500 stone. I think a $25 "insurance charge" for each setting would be reasonable. However, I understand that they aren''t in the insurance business, and I think it would make a lot more sense for online diamond sellers to work with an insurance company to develop a loose diamond policy.

 

[fire&ice]

I guess I am in the minority. I don''t think or expect a benchmen to be responsible for a chipped stone. Even if one charges a higher price, surely, it can''t make up for badly chipping a 15k stone.

If I recall correctly, the arrangement I had was that a stone could be chipped. In the rare occurance, the "setter" would pay for the re-cut. The stone owner (me) would accept the new smaller size.

If the stone and setting was purchased from the "setter", then the store should assume the liability because of the built in profit from the sale.

Gleaning from the conversation, no such "chipping" insurance is available. So, the setter would have to charge a premium. To me, the risk would be far greater than the premium one would have to charge. Wouldn''t it have to be well into the hundreds to be able to absorb the full cost of the stone.

Sure, I''d pay extra for the setter to assume liability. But, from a setter''s point of view - it would have to be a hefty premium. Wouldn''t it?

 

[denverappraiser]

Date: 6/30/2005 2:54:16 PM
Author: fire&ice

Sure, I'd pay extra for the setter to assume liability. But, from a setter's point of view - it would have to be a hefty premium. Wouldn't it?

I don't know. Establishing the price is, of course, an important part of any deal. How about 1% of the agreed upon value? This should be small enough that customers are happy that all risks are covered and high enough that the jeweler feels that they're making a profit at the deal since the real risk is usually less than that. They would still have the opportunity to decline the job if the wanted but they threshold of what would be accepted and what would be declined would surely move. The jeweler still has incentive to be careful and the customer can reasonably feel protected.

Neil Beaty
GG(GIA) ISA NAJA
Independent Appraisals in Denver

 

[strmrdr]

What the industry needs to do is pressure the insurance companies to provide the coverage to cover it.
Thats the bottom line solution.

 

[denverappraiser]

Date: 6/30/2005 3:13:55 PM
Author: strmrdr
What the industry needs to do is pressure the insurance companies to provide the coverage to cover it.
Thats the bottom line solution.

Storm,

The problem the insurance companies have is that they can't reasonably assess their risks when betting on the skills of an unknown jeweler. They have no way to tell if the jeweler incompetent, drunk, or any manner of other problems that they want to have nothing to do with. Anyone who wants to can claim to be a jeweler but this doesn't make them qualified.

Neil Beaty
GG(GIA) ISA NAJA
Independent Appraisals in Denver

 

[1stdiamondbuy]

I haven''t figured out the quote thing here, but here is the text from an earlier post by Feydakin ...

As much as many of us hate to admit it, there are a lot of hacks out there that simply don''t understand modern stone setting techniques and bust a lot of diamonds in the process..

And here is the text from a post by denverappraiser ...

They have no way to tell if the jeweler incompetent, drunk, or any manner of other problems that want to have nothing to do with. Anyone who wants to can claim to be a jeweler but this doesn''t make them qualified.

My question is how does the average consumer weed out the good from the bad when they want to get something set locally?

I still think there has to be an insurance answer, especially as demand for online diamonds grows. I have read on here that blue nile has worked something out with chubb so that chubb does offer a loose stone policy to blue nile buyers. Is that accurate, does it still exist? If so, why can''t others work out similar arrangements? It would fill a big gap in the online diamond buying industry that would probably increase demand. Short of an insurance answer, I think the setter charging 1% or so of the diamonds agreed on value to guarantee their work would be fair. That assumes they chip 1 in 100 stones.

Out of curiousity, what is a fair price to set a stone ... obviously geographic differences, but what is an average range?

 

[denverappraiser]

Date: 6/30/2005 3:56:25 PM
Author: 1stdiamondbuy

That assumes they chip 1 in 100 stones.

For a decently skilled jeweler setting a reasonable stone in a reasonable ring, the risks are considerably less than this. For a jeweler that doesn''t know their stuff, this may be low. This means that for a skilled jeweler, this is an opportunity to make some extra money by betting on their own talents. For a crappy jeweler this is a way to go out of business fast. As a consumer, the fact that they would make or accept such an offer may be a useful clue. Other clues are referrals from friends and neighbors, examining their merchandise on display in their showroom, checking their records with BBB and JVC, searching pricescope and talking with them.

Date: 6/30/2005 3:56:25 PM
Author: 1stdiamondbuy

I have read on here that blue nile has worked something out with chubb so that chubb does offer a loose stone policy to blue nile buyers. Is that accurate, does it still exist?

I think this is not accurate but there are others here who have more experience with Chubb than I. Has anyone successfully filed a claim of this nature against Chubb? Jewelers Mutual has something of a program if both the consumer and the jeweler are their clients but I''ve not heard much about this since it started about a month ago. There are several Jewelers Mutual people who are regulars on this forum. Anyone care to comment?

Neil Beaty
GG(GIA) ISA NAJA
Independent Appraisals in Denver

 

[WinkHPD]

Date: 6/30/2005 12:04:45 PM
Author: 1stdiamondbuy
I think a professional jeweler should guarantee their work. If they aren''t comfortable with the integrity of the stone, don''t take the business. I have a hard time accepting that people won''t take accountability for their work. I would think they would be able to get insurance for this type of work and spread the cost of that insurance over the work that they do. I see the whole ''no accountability'' thing as a ploy by local jewelers to try to convince you to buy from them instead of buying online.

That would probably be because you have no problem with them taking all the risk on a stone worth thousands of dollars in exchange for a setting job on which the profit might be $10 - $15. We jewelers would LOVE to be able to get reasonably priced insurance for this, but I personally have never been able to get it.

That is why this is a conversation that needs to be had PRIOR to accepting such a job. If I have to take the risk on a stone you purchased elsewhere then I do not need the work. When I sell the stone I take the risk.

Wink

 

[solange]

After reading this thread I was wondering whether my insurance company Liberty Mutual--would cover the cost of a diamond that was damaged while being worked on by a jeweler.

I just called the agent who handles all our insurance said she said that our policy would not cover the stone when it was out of my possession and being worked on by a jeweler. She said this would be a matter for the Jeweler's insurance company.

From what I have read here, jewelers are unable to get this kind of policy so I guess you are on yoiur own if your stone is damaged during setting unless the jeweler wants to assume responsibility. As Wink stated, it would be foolish for him to accept responsibilty for an expensive stone bought elsewhere at a very modest fee for setting it. Even if the jeweler supplies the setting, it would not be cost effective to assume responsibility for a stone that is worth far more than his profit onthe setting.