Quite curiously, for an industry worth so much, diamond buying and selling don’t have too many regulations.
Kimberley Process and conflict diamonds aside, there are actually very few rules on who can buy or sell diamonds. Nor are there any rules on the quality of the diamonds on offer. There are consumer laws which say how a diamond must be described in certain circumstances, but little else.
However, if a dealer is serious about doing things properly, all their diamonds will be certified. Any number of recognized organizations can issue certificates. Without a grading certificate, it is very difficult to sell a diamond through regular channels. At the very least, the lack of a certificate will reduce the value of the diamond considerably. The certificate gives the buyer all the information they need to have the stone valued independently. It also gives specific information on the size and anatomy of the diamond.
Most crucially, it gives information on the 4Cs. Each C of color, clarity, cut and carat weight is subject to evaluation and grading. These, collectively, will then lead towards a value based on the current market.
One of the leading firms for diamond certification is Universal Gemological Laboratory or UGL.
UGL has been in operation since 1995, offering many different services. For certification, each diamond undergoes intense scrutiny. Although opinion still plays a part, each of the 4Cs has well set out guidelines. Most of these are measurable using the correct tools, thereby taking out some of the subjectivity. Some aspects, such as color, will still depend on the eye of the expert, but the certificate will be otherwise mostly objective.
UGLs certificates are very well regarded in the industry. There were concerns in the very early days that they were being overly generous in their evaluations. However, today, all their staff are highly qualified, with many trained by the Gemological Institute of America. GIA is the world’s leading issuer of diamond certificates and was instrumental in setting many of the standards currently in place. Because of the quality of training from GIA, UGL staff are all acknowledged experts.
After the undisputed leader GIA, UGL is generally one of the companies next in line in terms of certification quality. The certificates are thorough and accurate to the highest standards. If you are offered any item with a UGL certificate, you can assume it is a worthy indication of the items quality.
Appraisals are very different from Certificates. It is jewelry pieces that have appraisals, rather than individual diamonds.
A UGL appraisal will contain all the relevant information for any piece of jewelry. It will contain a picture of the actual piece in question, for identification purposes in the future. It will also have information about each stone set in the piece, with color, cut, clarity and carat weight. There are certain caveats to this, however.
Because the stones are already set, size and weight are approximations. Rarely will the stones be available for separate evaluation, and so some assumptions are necessary. These assumptions are according to a precise set of calculations according to the parts of the stone which are visible. Symmetry is part of the original diamond grading, and so several measurements to establish the overall symmetry then allow an accurate weight measurement.
As well as the technical details of the piece, it will always note that the appraisal is subject to the mounting. The appraisal will also usually give the reason for the appraisal itself. This can be insurance, tax, valuation or a number of other things.
Unless for a solitaire ring, diamonds separate to the center stone will be shown separately. They will not be all subject to individual appraisal, but rather as a combined weight and an estimate of the collective color. A brief summary of the piece often makes up part of the appraisal but is usually for the diamonds only.
Finally, the document will show the estimated retail value at the time of appraisal. This is usually good enough for insurance companies for at least 12 months.
UGL appraisals do appear to be pretty accurate as far as valuations go. The information they contain is also comprehensive and very clear.
Overall Document Standard
As we’ve said, UGL is number two in the certification and appraisal stakes, behind GIA. This doesn’t mean UGL is any less relevant or accurate than GIA, although GIA certificates do still carry a premium and tend to increase the value of the diamond in question.
Still, UGL is an excellent way to establish the quality and value of a diamond. They are also vital if you intend to insure your ring or another piece of jewelry (which you should!). We all know that insurance companies are no fools when it comes to paying out money. That they readily accept UGL certificates and valid and accurate both on quality and estimated cost should be an indication that the documents are well worth the effort and relatively low cost of acquiring.
We can’t speak to problems in the early years of UGL. All we can say is, if problems did exist with optimistic valuations, those problems appear to have been resolved. Nowadays, it’s easy for anybody to get more than one evaluation if they have any doubts. UGL wouldn’t have lasted over 20 years if they were in any way unreliable.
They will never be the equivalent of GIA in some people’s eyes, but that’s an issue for those people to deal with. For diamond certification and jewelry appraisal, UGL is a very good option.