How do you insure a car that isn’t depreciating? Make a whole new insurance product that uses a valuation the customer and insurance company can agree on. Classic/ collector vehicles are insured at a value that reflects market value, but finding a market value for unique vehicles can be tough. Fortunately, there are resources available to help. Find your valuation and get your car coverage it needs!
Agreed Value is the flagship coverage of classic/collector vehicle insurance. It’s the baseline to be used if your vehicle is damaged and needs repair, and the amount you will be reimbursed if your vehicle is totaled.
In Agreed Value insurance, the insurance company and you “agree” on a value for your vehicle. Once your insurance policy is active with that value for your vehicle, you’re covered.
So, what is an amount that you both can agree on?
You don’t usually need an appraisal to get the valuation you want for classic/collector vehicle insurance. But you should think like an appraiser.
Classic/collector insurance companies want to insure vehicles at market value, but finding a market value isn’t necessarily a straight road. Only about 30% of classic/collector vehicle sales are through dealerships or auctions, with the rest changing hands in private sales.
To keep things simple, most classic/collector vehicle insurers screen values against a database (usually NADA), and if your Agreed Value request is within 20% then they usually agree on the valuation with no questions asked.
Online valuation Tools:
Online valuation tools make for quick and easy searching but can sometimes miss the mark. Nevertheless, these tools can serve as one piece of the puzzle.
National Automobile Dealers Association (NADA): A leader in accurate vehicle pricing, NADA bases its data on sale prices of more than 16,000 franchised dealerships.
Edmunds: Uses similar data sources to offer an online appraisal service where customers can enter their VIN, license place or search based on Year/Make/Model. Model years older than 1990 are not available.
Kelly Blue Book (KBB):
Another well-known company that is a reliable source for vehicles in poor to good condition. Values vehicles back to 1992.
An extensive list of prices for classic cars.
Collector Car Market Review
A list of prices for classic cars from model years 1946–1983.
Just because your vehicle comes out of one of these valuation sites with a number that is off from what you think (or know) your car is worth doesn’t mean you can’t get a higher valuation. If you can make a good case for your vehicle, some insurers are open to reconsidering.
Classic/Collector vehicle auctions (for sale today):
Can you find a few cars to use as comparisons for your vehicle? These may be helpful to address differences in the valuation you need and what pops up in an online valuation tool.
A resource with historical sales of different models, grouped by model and trim.
Bring a Trailer (www.bringatrailer.com/models)
A great resource for current and past sales, with a well-organized layout.
If your vehicle is modified and you can count the number of vehicles like it on one hand (or no hands), then market value can’t take you all the way there. Extensive modifications can easily double or triple the value of a vehicle. If this is the case for you, then you’ve obviously have a beauty (or beast), and we love it! But expect some questions from the insurance companies.
For modified vehicles, the INSURANCE-MOD online submission form will ask you for extensive photos: in front of its storage location, from front left, from back right, of engine, of trunk and of interior. Simply providing these will help get a toss-up to go your way.
If your valuation is around 20%–50% higher then the valuation websites, some companies will look at the photos and make a judgment call about whether to accept your valuation. If your modified valuation is more than 50% higher than the website valuations, this is where the track gets sticky and it’s time to pay attention.
At some point, most insurance companies will request a list of the custom parts that are in your vehicle and their value. They will take the total value of those parts and add it to the stock market value, and then agree to insure it for that amount. That doesn’t sound so bad, right? Well, that was the good news. The bad news is that none of the insurance companies will add labor into this calculation. As a result, some modified cars will only be able to get slightly lower valuations than they actually would get if they were sold. If this happens to you, keep an eye on your vehicle’s condition, because better condition means higher baseline valuation.
Despite the labor value issue in valuation, Classic/Collector insurance is still the best insurance product out there for almost all modified vehicles that are otherwise eligible. Maybe one day we can change this—but for now, we’ll have to work with the tools we have.
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