Insuring Celebrity Red-Carpet Jewelry

A red-carpet turn can make you a star -- especially if you're a jeweler.

There's no bigger stage upon which to announce your arrival into the jewelry big leagues than that scarlet-clad sidewalk leading into the Oscar, Grammy, Emmy or MTV Video Music awards shows.

Landing a stunning bracelet on Reese Witherspoon, diamond pendants on Angelina Jolie or a six-figure gem suite on Sandra Bullock can transform a well-kept secret into a household name overnight.

Just ask Jorge Adeler, an Argentina-born custom jeweler whose studio in Great Falls, Va., makes one-of-a-kind jewelry for the wives of movers and shakers in nearby Washington, D.C. Once Hollywood's A-list caught a glimpse of Adeler's artistry, he received so many requests to borrow his pieces that he was forced to open his own showroom in Beverly Hills, Calif., just to accommodate them.

"Hardly a week passes now without us being in one magazine or another: Redbook, InStyle, Martha Stewart, Brides magazine," says 65-year-old Adeler. "It is a great compliment."

It has also been a crash course in how these expensive pieces survive the perilous journey from jeweler's bench to a starlet's neckline and back.

Come along; it's quite a ride. The match game

How does a 40-carat Harry Winston princess necklace find its way onto the sculpted shoulders of Gwyneth Paltrow as she accepts the 1999 Academy Award for best actress in "Shakespeare in Love"?

"Sometimes the jewelers seek out the individual, sometimes the clothing designer seeks out the jewelry, and sometimes the customer has a relationship with Winston or whomever," says Janece White, vice president and jewelry underwriting specialist for Chubb Group of Insurance Companies.

Adeler says most of his celebrity requests come via a very small group of stylists and photographers. Despite how it may appear on the red carpet, his jewelry is never made for the starlet.

"All the pieces that the celebrities wear were made for my clients, not for the celebrities," he says. "That's the irony: My customers are my celebrities, and the Hollywood celebrities happen to like the pieces that I make for my customers."

While celebrities sometimes purchase the pieces they borrow, it's not the norm for good reason.

"Jennifer Lopez has used our pieces seven times, but compared to the amount of jewelry a celebrity might use in a given year, that's a drop in the bucket," he says. 'Who are you wearing?'

Celebrities and jewelers long for that microphone moment when the star is asked, "Who are you wearing?" But it takes lots of insurance preparation to make that happen.

White says jewelers typically carry what's called "jewelers block" coverage that protects their entire jewelry inventory. While the block policies of a Harry Winston or Tiffany's may extend coverage to items on loan or consignment, for jewelers such as Adeler, coverage stops at the point of transfer.

"Our insurance covers the jewelry until it's in the celebrity's hands, then they are responsible for it," Adeler says.

The jeweler's insurer will typically require the celebrity to either show proof of sufficient "valuable articles coverage" or sign an agreement that assumes financial responsibility for loss, damage, and theft out of his or her own pocket.

"If the celebrity already has jewelry coverage, their insurer may be able to extend its limits to cover the event," White says. "But if they don't have coverage, it would be very difficult to buy insurance for those couple of days. They would have to buy short-term coverage from an insurance broker through a syndicate like Lloyd's of London, and it would be very expensive." The transfer

Proof of insurance is just the first step toward the red carpet. The jeweler's underwriter will also ask how the celebrity plans to execute the transfer.

"We need to know when they (are) picking up the jewelry, how the transfer is going to take place, where they are going to keep the jewelry when they take it off at night, and when it will be returned to the jeweler and in what manner," says White.

If the underwriter doesn't like the plan, the company may require adjustments.

"Sometimes it's all done by a security guard; they take them to get the jewelry, and they take them to bring it back," says White. "I've even seen security be assigned to the event, depending on how big it is."

White admits she's a little more nervous underwriting the Grammys and MTV Video Music Awards than the Emmys or Oscars. "It's a different crowd coming to see them," she says.

The underwriting decision often boils down to the celebrity.

"In the end, is this somebody who is established, mature, who can tell me the chain of command, and I can trust that that is exactly what they're going to do?" she says.

The risk

So what's the risk that a half-million-dollar Neil Lane broche will mysteriously "disappear" during an after-party celebration, and a claim will need to be filed? Slim, says White.

"Claims on something 'borrowed'? The answer is no, knock on wood," she says. "But I have seen claims for big, stellar events where our customers did lose jewelry. It's usually an earring or a bracelet, things that catch on things and fall out."

White catalogs the types of losses this way:

"The biggest cause of loss for us is 'mysterious disappearance.' That's when something falls off, and you can't find it. Another is 'unknown theft,' where you thought you left it in the hotel room, and it's gone. And there's the 'inside job,' where you have housekeeping and other people in the house, and things walk away. The 'stick-up robbery' does occur, but it doesn't happen as often with high-net-worth clients because they're not normally on the subway or the bus," she says.

As for the risk that a star will simply fail to return a borrowed piece?

"That's the individual you don't want to (under)write," she says. "That's somebody who is not mature and ethical. I would not want to insure somebody who is unethical."

The knockoffs

Within hours of a red-carpet event, the knockoffs appear, finding their way to the shopping networks and costume jewelry sites practically before the seats have cooled.

They're of little concern to Adeler, whose unique designs defy imitation.

"Because my pieces are one-of-a-kind, using stones that are quite unique, they're going to have a very hard time," he says. "For instance, I made a ring with a fragment of a meteorite that fell in Russia in 1947. How can you copy a meteorite ring? Or a pair of earrings with two 30-million-year-old fossilized ammonites from Morocco. Jeez, that's going to be tough to make in mass production."

Although he's only met a handful of the 100-plus celebrities who've worn his creations, Adeler has fond memories of designing a custom line of jewelry for "Heroes" star Hayden Panettiere, who supports the Save the Whales Again campaign.

"She wore my pieces in Congress and used her website to raise money to help whales and dolphins that I love very much," he says.

Adeler says custom jewelry remains his first love.

"My edge is that everybody wants to wear something that is unique," he says. "I think that is the key to my success."

Priceless tips

Want to keep your own jewelry red-carpet ready? Chubb spokesman Dave Hilgen offers these suggestions:

Diamonds: When cleaning diamonds, use mild detergent or a sudsy ammonia bath. Never let diamonds touch chlorine bleach, as it can pit and discolor the mounting. Have prongs and mountings checked annually. Store diamonds separately, as they can scratch all other jewelry.

Pearls: Wipe pearls with a soft cloth after each wearing because perfume, cosmetics, hairsprays and skin oils can erode the quality over time. Have pearls restrung regularly to prevent breakage. Store your pearls in a soft cloth pouch to prevent scratching.

Gemstones: Remove gemstone jewelry when under intense sunlight or tanning lamps because these can fade the stones. Guard against loose settings by having prongs and mountings checked annually.

Storage: Don't keep your most valuable pieces in your bedroom; it's the first place a burglar will look. Instead, consider a home safe with the appropriate jewelry rating or keep valuable items in a bank vault.

Travel: When traveling, keep expensive items with you at all times or use a hotel safe. Don't pack jewelry in your luggage or wear valuables to the pool or beach.