Vehicle value for insurance purposes

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Model T Ford Forum: Forum 2016: Vehicle value for insurance purposes
Top of pagePrevious messageNext messageBottom of page Link to this message  By Brian Hurt on Wednesday, July 06, 2016 - 12:01 am:

I am looking at getting insurance for my 23 Touring. I am down to replacing the upholstery and roof to be finished. This car is a COMPLETE rebuild. It was stripped to the bare frame. New wood frame too.
It is over restored if there is such a thing. If I started a full rebuild today like I have it would cost no less than $15K for what I have. Do I insure for $15k? Would the selling value be higher than that? I don't want to throw money away by over insuring it. Would insuring for say $20k be out of line?


Top of pagePrevious messageNext messageBottom of page Link to this message  By Jared Buckert on Wednesday, July 06, 2016 - 03:43 am:

Depends on the insurance company. Some of them will look at a $20k valuation and require some form of evidence to back up your statement. Then there are some who just take your word for it. I believe Hagerty does this, but I'm not sure as I don't have them yet. The theory is it's your car and you know what you need to pay to replace it, as well as any extra you feel you deserve to make up for sentimental value, lost family heirloom, all of that.


Top of pagePrevious messageNext messageBottom of page Link to this message  By Royce in Dallas TX on Wednesday, July 06, 2016 - 06:42 am:

$20k is not a number that any antique car insurance company would balk at. It is a fair replacement valuation.


Top of pagePrevious messageNext messageBottom of page Link to this message  By Dan B on Wednesday, July 06, 2016 - 07:23 am:

The car needs to be insured for fair market value. Do not let emotion be a factor or you WILL overpay.


Top of pagePrevious messageNext messageBottom of page Link to this message  By Zachary Dillinger - Charlotte, MI on Wednesday, July 06, 2016 - 08:15 am:

Retail Replacement Value (RRV), not FMV. RRV means the highest amount you would expect to pay to replace the vehicle including any applicable taxes, shipping, etc. I say this as a fully accredited USPAP-compliant appraiser of personal property. Some insurance companies cloud the matter by using incorrect terminology (done intentionally to confuse you in many cases). "Market Value" for example, which has no real meaning. Best to ask the insurance company exactly what they mean.

Bear in mind that the higher the agreed upon value, the more you will pay in premium. The difference between $15k and $20k likely isn't enough to make a huge difference so I'd go with the highest amount that the insurance company will let you get away with. Better to be safe than sorry.

(Message edited by zdillinger on July 06, 2016)

(Message edited by zdillinger on July 06, 2016)


Top of pagePrevious messageNext messageBottom of page Link to this message  By Dan B on Wednesday, July 06, 2016 - 08:31 am:

How would one determine retail replacement value in this case?


Top of pagePrevious messageNext messageBottom of page Link to this message  By Mark Myers_____Pittsburgh, PA on Wednesday, July 06, 2016 - 08:36 am:

I always figured that if I damaged my roadster for what I had into it (or insured for) I'm dead anyway...


Top of pagePrevious messageNext messageBottom of page Link to this message  By Zachary Dillinger - Charlotte, MI on Wednesday, July 06, 2016 - 08:39 am:

If asked to do this appraisal, I would seek out classic car companies that sell similar cars in a retail setting, determine their price level, add in an extra thousand for shipping expenses, and call it done. Failing that, I would consider taking auction results and adding a percentage multiplier to convert an auction price to a retail price... this is not ok for the IRS but for most insurance companies that would be ok (most insurance companies do not require comps, but the IRS will bust your rear if you don't have them).

FMV relies heavily on auction results for pricing but auctions are spotty, meaning that an exact replacement may not come up for some time. The assumption is that an object of like kind and quality to the object you are insuring, be it a painting or a Model T, is available immediately on the retail market. You shouldn't have to wait around for the right car to enter the auction market, RRV means you can buy the car immediately at the retail price.

This is a little more difficult for things on the esoteric side, i.e. a properly restored Model T, than it is for things easily found, i.e. a Corvette, Mustang, etc. That's why I say go high on the RRV and you won't regret it.

(Message edited by zdillinger on July 06, 2016)


Top of pagePrevious messageNext messageBottom of page Link to this message  By Chris Laughary on Wednesday, July 06, 2016 - 09:17 am:

I use Hagerty ins


Top of pagePrevious messageNext messageBottom of page Link to this message  By John Zibell, Huntsville, AL on Wednesday, July 06, 2016 - 11:04 am:

With Hagerty you state the value. All they ask is for a few pictures of the car. I also insure my trailer (for when it isn't attached to the truck) with them and they asked for pictures of it as well.


Top of pagePrevious messageNext messageBottom of page Link to this message  By Royce in Dallas TX on Wednesday, July 06, 2016 - 01:39 pm:

Hagerty requires an appraisal above a certain value, I believe it is $50,000. All of the other collector car insurers are similar. They don't care below that number, because loss rates for antique cars are very low.

You want to insure for Replacement value, because if you do have a loss it will most likely be a total loss.


Top of pagePrevious messageNext messageBottom of page Link to this message  By William L Vanderburg on Wednesday, July 06, 2016 - 01:51 pm:

Mine is with American Collectors. A couple of snaps and an agreed value, and voila! done.

The rate of mine is 123 bucks or so a year, and the value was automatically increased by the insurance company since original policy purchase.


Top of pagePrevious messageNext messageBottom of page Link to this message  By William L Vanderburg on Wednesday, July 06, 2016 - 01:52 pm:

I meant agreed replacement value.


Top of pagePrevious messageNext messageBottom of page Link to this message  By Tim Lloid on Wednesday, July 06, 2016 - 03:20 pm:

I insured my 27 for what it would cost to replace it with a comparable T. My model A coupe is insured for $25K and the premium is $206.00 a year. Tim


Top of pagePrevious messageNext messageBottom of page Link to this message  By Bob Coiro on Wednesday, July 06, 2016 - 04:29 pm:

Most insurance companies that specialize in collector-cars deal in what is known as "agreed value" policies. _What that means is; you and the insurance company come to an agreement as to what your car is worth and in the event it gets damaged beyond that agreed value, you'll receive a check for the full worth of the policy and the insurance company gets to keep the wreckage which it will sell for a few cents on the dollar for parts.

In the event your car is only damaged, the insurance company will pay to have the car repaired, unless you've mistakenly agreed to a value so low, the company decides it is in its own interest to "total" your car and offer to purchase the repairable vehicle from you at the agreed value, which is less than what the car is actually worth, even with its damage. _You sure don't want that arrangement! _This is why, in my opinion, it is always better to insure your car for at least every penny of what it is worth.

Another humble opinion: _With regard to choosing an insurance company; I've never, ever heard a single bad word said about Hagerty. _With an absolutely sterling reputation, they are the Lang's Old Car Parts of insurance companies. _Hagerty absolutely loves antique cars and they promote the living daylights out of 'em, even to the point of encouraging policy holders to teach their teenage kids to drive the cars, because getting young people involved is good for the hobby. _If you've been alive long enough to know that the sky is above and the ground is underfoot, you'll also know that most insurance companies would rather you NOT let your teenage kids joyride in your car.


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