Insurance Fixed Value

[jhv48]

I guess I'm sort of confused about why some of you insist on getting a stated/declared value on your cobras by the insurance company.

As far as I, and my insurance company, are concerned, my car is worth whatever the market says it's worth at the time of the incident. Do I expect to be able to replace my 4 year old SPF with a brand new SPF if mine is stolen? Of course not. I expect to be able to buy a similarly constructed, four year old, used SPF. And my insurance company agrees with me.

If you buy and insure a $100K Mercedes and it is stolen four years later, you're not going to get enough money to buy a brand new Mercedes. You'll get whatever your car was worth at the time of the incident. Seems fair to me!

[scottj]

I have Midwest Classic and the highest value they would agree to is a little over half of what I have in it. At least they raise it by 5% per year. I was given the option of having an independent appraiser determine fair market value, but that isn't the same as replacement cost.

The way I look at it, 50 cents on the dollar is a good return when I sell a race car and when I've wrecked race cars the return was zero. Though it's not a race car, I can live with 1/2 coverage...

[marklotus]

Originally Posted by jhv48

I guess I'm sort of confused about why some of you insist on getting a stated/declared value on your cobras by the insurance company.

As far as I, and my insurance company, are concerned, my car is worth whatever the market says it's worth at the time of the incident. Do I expect to be able to replace my 4 year old SPF with a brand new SPF if mine is stolen? Of course not. I expect to be able to buy a similarly constructed, four year old, used SPF. And my insurance company agrees with me.

If you buy and insure a $100K Mercedes and it is stolen four years later, you're not going to get enough money to buy a brand new Mercedes. You'll get whatever your car was worth at the time of the incident. Seems fair to me!

What you want is an "Agreed Value" policy, You establish the value upfront and pay premiums based on that value. If you have a claim, there is no disputing the value since it was agreed to in advance. This a common method of insuring collector vehicles.

[scottj]

Originally Posted by marklotus

What you want is an "Agreed Value" policy, You establish the value upfront and pay premiums based on that value. If you have a claim, there is no disputing the value since it was agreed to in advance. This a common method of insuring collector vehicles.

You have to look at how they define "agreed value". Midwest Classic wouldn't "agree" to over market value no matter what I was willing to pay.

[marklotus]

Originally Posted by scottj

You have to look at how they define "agreed value". Midwest Classic wouldn't "agree" to over market value no matter what I was willing to pay.

I submit to my insurance company (Hagerty) every year my estimated value. It has to be reasonable for the car otherwise they won't agree to it. My premium is based on the agreed value. If I have a claim, there is no argument about the value. It has already been agreed.

Stated or Declared value is a one-way conversation. You tell them, state, declare what you think the car is worth. It is noted in the record. If you have a claim, the value is then up for review, discussion, estimation, negotiation, etc. The discussion takes place after the claim is made. The insurance company can then say that your car is not worth the stated value and you have a disagreement.

[scottj]

Originally Posted by marklotus

I submit to my insurance company (Hagerty) every year my estimated value. It has to be reasonable for the car otherwise they won't agree to it. My premium is based on the agreed value. If I have a claim, there is no argument about the value. It has already been agreed.

Stated or Declared value is a one-way conversation. You tell them, state, declare what you think the car is worth. It is noted in the record. If you have a claim, the value is then up for review, discussion, estimation, negotiation, etc. The discussion takes place after the claim is made. The insurance company can then say that your car is not worth the stated value and you have a disagreement.

When I was with Hagerty that's how it worked for my policy as well, in fact, that's how it works with my Midwest Classics policy now. The only problem is, $53K is all Midwest considers reasonable (unless it's a Kirkham or CSX replica) and Hagerty no longer writes Cobra replica policies. Hagerty doesn't consider them collectable or classic since you can walk into a dealership and buy a new one.

[1795]

Hagerty will write a policy on a replica. I went with Midwest because I was able to negotiate more mileage out of them and reduce some of the other restrictions, of course at a cost. However, both of them were willing to write a policy on my SPF. My two cents on the agreed upon value, I think that you have to negotiate that, Midwest agreed to a value from me without asking to see the sale receipt, there really is no "book" value on these cars and so trying to establish a replacement value based upon the market value can be difficult and that leaves a lot of room for disagreement.

Jim

[kevins2]

Originally Posted by jhv48

I guess I'm sort of confused about why some of you insist on getting a stated/declared value on your cobras by the insurance company.

As far as I, and my insurance company, are concerned, my car is worth whatever the market says it's worth at the time of the incident. Do I expect to be able to replace my 4 year old SPF with a brand new SPF if mine is stolen? Of course not. I expect to be able to buy a similarly constructed, four year old, used SPF. And my insurance company agrees with me.

If you buy and insure a $100K Mercedes and it is stolen four years later, you're not going to get enough money to buy a brand new Mercedes. You'll get whatever your car was worth at the time of the incident. Seems fair to me!

I'm not an insurance expert by any means, but I don't believe these cars follow the same depreciation rules as a "normal" car. The market is certainly a factor, but it is more likely that your Cobra replica will be worth close to its original value over time (or even more, possibly) than your daily driver would...or even a Mercedes.

[motordean]

Originally Posted by Cashburn

Give Mike Smith a shout at Northeast Classic Car Insurance - Classic Auto Insurance

Will do - thanks.

Originally Posted by 427 ISH

I have a declared value. I agree, leaving to "Replacement" value, based on the market will get me another Cobra - However, it will not be "My Cobra". I know where every wire and nut is on mine. If totaled, I will want that same value. I am paying a bit more for the overstated value (versus market value), but I will want to build another if total loss occurs, not buy one.

That's what I'm talking about!

Originally Posted by kevins2

I'm not an insurance expert by any means, but I don't believe these cars follow the same depreciation rules as a "normal" car. The market is certainly a factor, but it is more likely that your Cobra replica will be worth close to its original value over time (or even more, possibly) than your daily driver would...or even a Mercedes.

Agreed 100%

Thanks everyone for your feedback!

[jhv48]

Originally Posted by kevins2

I'm not an insurance expert by any means, but I don't believe these cars follow the same depreciation rules as a "normal" car. The market is certainly a factor, but it is more likely that your Cobra replica will be worth close to its original value over time (or even more, possibly) than your daily driver would...or even a Mercedes.

That's my point, if the market goes up, so does the replacement value of my car. If it goes down, so does mine. Still based on real world prices, and I don't pay for an inflated agreed value. What if the actual value of your car exceeds the agreed value that you originally signed up for? Do you only get the lower amount?

[JoeT]

Originally Posted by jhv48

I guess I'm sort of confused about why some of you insist on getting a stated/declared value on your cobras by the insurance company.

As far as I, and my insurance company, are concerned, my car is worth whatever the market says it's worth at the time of the incident. Do I expect to be able to replace my 4 year old SPF with a brand new SPF if mine is stolen? Of course not. I expect to be able to buy a similarly constructed, four year old, used SPF. And my insurance company agrees with me.

If you buy and insure a $100K Mercedes and it is stolen four years later, you're not going to get enough money to buy a brand new Mercedes. You'll get whatever your car was worth at the time of the incident. Seems fair to me!

The replica market varies so much in the market it would be hard to find a true market. Even within specific manufactures there is a wide gap.

I've seen SPF's sell for $30k and I've seen them sell for $70K, guess which one your insurance company think you own when it's time for a payout?

I have an FFR, I've seen them sell for $18k and $70k. Mine is agreed upon at $40k. Could I replace/rebuild it for 40? no, but it's a "fair market" value. maybe a little strong.

The same could be said for continuation cars. If you and the insurance company "agree" on value, there's no debate when you think it's worth $150k but they're selling real world for $80k

An agreed value policy takes all the guesswork and back and forth between you and the insurance company

[jhv48]

I guess if I didn't trust my insurance company to treat me fairly I would do just that.

Fortunately, I do trust them. If I didn't, I would find another company.