Accurate Auto Appraisers
Classic Car Insurance
What is Agreed Value Coverage, and Why You Should Care
There are typically three methods used to decide what you get paid if your auto is a total loss. Each is different, and protects you to a different degree. Only one guarantees you get what you expect, or even what you pay for.
If you're in doubt as to what you have now, don't take anybody's word for what is included in your coverage. Read the policy language yourself, and ask your agent for written clarification if you have any doubts or questions.
#1 Agreed Value
The most desirable for car collectors. It leaves no doubt as to what will be paid in the event of a loss. With Agreed Amount coverage, the amount you see on the policy is what you'll get if the car is written off as a total loss. Period.
#2 Actual Cash Value (ACV)
Typically provided by standard auto insurance policies. The insurance company decides what you get paid at the time of the loss. While you may have some input if you don't agree with them, the final decision is theirs. It will be based at least in part on using sources which you may not agree with. If you refuse to settle for what they want to pay you, you may need to resort to legal action to arbitrate the issue. We can help if you are already in a dispute, this service can be very expensive.
#3 Stated Value
Often provided on collector and limited use policies. The policy language typically states the insurance company will pay the Stated Amount, or the Actual Cash Value, or the cost to repair not to exceed the Stated Amount whichever is less.
Guess what: The Stated Amount is just used to determine your premium cost: The higher your Stated Amount, the higher your insurance premium. The contract language permits them to pay what they decide the Actual Cash Value of the auto is. They are under no contractual obligation whatsoever to pay the Stated Amount. Surprise!
Unsure what you have?
1. Read your policy . If you don't have all of the forms (the policy and all endorsements) then request a complete policy.
2. Get in touch with an underwriter from your insurance company. Don't take advice from your agent on this subject.
3. Ask the underwriter for a valuation guarantee in writing, on company letterhead.
4. Have the underwriter direct you to the language that spells out the valuation . If you don't get anything but straight answers, look for another insurance company.
Get a professional appraisal.
The purpose of an Agreed Value is to match the actual market value of the auto as closely as possible. It is not meant to cover any extra intrinsic value you may place on the car for personal reasons. We have a pretty good idea as to the appropriate value of most autos, given their mileage, condition, history, custom modifications etc.