I'm pretty sure I know the answer to this question but I'll ask it anyways since there might be a wrinkle I haven't thought of. My '65 Coronet is insured with State Farm on a stated value collector car type of policy and it is fairly reasonable. I think they charge me about $20 a month. My '72 Duster is also insured with State Farm but it is on a normal policy not a stated value. They won't insure it on a stated value policy since it has a roll bar in it. I think the cost for that policy is around $30 a month but they won't tell me what the market value of the car is. They just say that if it is in an accident they'll repair it up to the market value but they claim that they can't tell me what the number is. So I don't know if it is $1500 or $15,000.
I can get a stated value policy from Haggerty for roughly $40 a month so I'm going to do that. I figure the Haggerty insurance is a much better deal than the State Farm time bomb since I'm almost positive if the Duster got hit they would tell me that the car is only worth a few thousand so here is the check and sorry for your loss. Do I have this figured correctly or am I missing something? Here is a picture of the Duster.
Andy,
You can’t go wrong with Haggerty. With State Farm you can’t trust them to step to the plate should you have exercise a claim on your stated value policy.
What is agreed value insurance?
Agreed value — sometimes referred to as “guaranteed value” — is an amount you and your insurance company agree a specified item is worth. Unlike most other coverages, if an item is covered at agreed value, you are guaranteed to receive the full amount stated in the policy in the event of a loss.
Typically, you and your insurance company will agree on the value of the item before the policy is even issued. Your items will have to be appraised, proving the value to the insurer. You will be able to find this inside your policy, which should directly state that the insurer will cover the item(s) at the “agreed value.”
With agreed value coverage, the insured value of your property doesn’t depreciate, at least not over the course of your policy term. However, you will likely have to undergo an appraisal at the beginning of each new policy term.
Along with classic or modified cars, agreed value is a popular option for jewelry. For an added premium, you can have high-value jewelry items replaced at the agreed value listed on your policy. Like other agreed value items, you are likely to have to provide a recent appraisal or bill of sale.
What is stated value insurance?
State value is commonly mistaken for agreed value, though the two vary dramatically in the extent of their coverage. Most commonly used to provide insurance coverage for classic cars, an item’s stated value is determined by the individual, not the insurance company. While you may even have to provide documentation proving such a value, your insurance company will not necessarily pay this amount in full should you suffer a loss.
You may value your classic car at $100,000 (and pay the corresponding stated value rates). However, you are not necessarily entitled to that amount should you suffer a total loss of that vehicle. An underwriter for your insurer will determine the market rate for the car and will pay out accordingly. If they find the market value to be $80,000, you could be looking at a payout substantially less than the value you stated.
Your policy will typically indicate it covers items at stated value or at actual cash value, whichever is less. In some cases, the ACV may be higher than the amount you stated. This allows you to insure an item for far less than it is actually worth, bringing your premiums way down in the process. However, should you suffer a loss you would still only get the lowest of the two amounts.
