Hometowne Insurance

Agreed Value vs. Stated Value Insurance

You live in Oswego, Montgomery or Morris (IL), and you have a 1967 Chevy Corvette in mint condition. Your father purchased it decades ago and took great care of it, and then, as an amazing gift, he gave it to you.

You have provided the same care for it as he did: regular cleaning and polishing, protection from the elements, selective driving to keep the mileage low.

classic car auto insurance

One beautiful summer day, you take it out for a short spin around town with the top off. When you’re driving through an intersection, another driver makes a last-second left in front of you and causes a collision.

Although no one is seriously injured, the Corvette is just about totaled. You can tell by looking at the car that a repair is out of the question. With that being the case, will you receive the full value for it from your insurance company?

The good news is that you can make sure you do if you have the proper coverage. To illustrate carrying the right insurance for a classic auto, we’ll discuss how carriers typically determine and insure auto values.

Actual Cash Value for Oswego, Montgomery, Morris Classic Car

quick quoteIf your policy will pay out according to the Corvette’s actual cash value, the amount will be what it was worth the day of the crash right before the accident.

To arrive at this value, an insurance adjuster will inspect the car at the tow yard. The adjuster will then refer to resources of their own choosing to form the settlement offer. This amount is usually based on the original purchase price in current-day dollars less depreciation.

Under this system, there’s always a chance you’ll disagree with the car’s stated worth. If you present evidence that the value is higher, the adjuster may or may not re-evaluate the payout amount.

If you’re really miffed by the stated value and you detect little chance of changing it, you might hire counsel to pursue the issue further, but of course this can create more stress and expenses.

Agreed Value for Oswego, Montgomery, Morris Classic Car

Where actual cash value can lead to a shortfall, agreed value coverage removes that concern if your classic car is eligible.

With this coverage – note that not all carriers offer it – you and the insurer establish a classic-car insurance policy in which both sides agree on the vehicle’s value based on an appraisal and photos when you set up the policy.

In financially securing the classic car’s more-accurate higher worth, an agreed value policy lets you substantiate everything you’ve done to maintain and even increase the car’s value, such as adding custom wheels or upgrading the engine. You will need to do a new appraisal on the vehicle as the market value changes.

With the crashed Corvette, agreed value coverage would pay you the full agreed amount in the policy without questions or negotiations.

Stated Value for Oswego, Montgomery, Morris Classic Car

Where an agreed value policy will pay one predetermined value, a stated value policy will include language that in the event of theft or total loss of your classic car, the insurer will pay out either the value stated in the policy or the actual cash value, whichever is less.

With a stated value policy, the insurance company does not set the amount – you do. However, this does not guarantee that you would receive it. In the event of theft or total loss, an insurance adjuster will determine the car’s current market worth apart from the value that you stated in the policy. In other words, the coverage leaves room for a differing assessment and a value reduction according to depreciation.

You might wonder why someone would choose stated value over agreed value. The answer is that some insurance companies do not offer agreed value on their collectible-auto policies. Some people want the cheapest option, so they go with stated value only to find out any money saved will be lost in the event of an accident.

Find the Right Classic-Car Coverage for You

With access to a wide range of carriers and types of policies, Hometowne Insurance provides the choices for locating your classic car’s ideal agreed value or stated value coverage. We can let you know if your car qualifies for the insurance and present you with premium scenarios that can adapt to your budget.

Contact us today to find out more about our versatile options for Oswego, Montgomery and Morris.

Oswego/Montgomery: (630) 554-4040
Morris: (815) 942-1312
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We are also a main source of classic-car agreed value and stated value insurance for nearby communities such as Batavia, Geneva, Aurora, Plainfield, Plano and Naperville.