We are often asked what is really meant by agreed value insurance, so we’ve put together below a list of the most commonly asked questions. Feel free to leave a comment if there’s anything else you’d like to know.
How do I assess my car’s value?
If you’ve owned your car for some time, its value is likely to have changed since you bought it – for better or worse! There are various ways to check out your car’s value, including:
- Price guides carried in classic car magazines
- Online price guides
- Checking out the prices advertised for similar cars in classified adverts
- Getting a valuation from a classic car special
How do I agree its value with my insurer?
Different brokers and insurers may have different processes for submitting the valuation, but at Adrian Flux customers are simply required (in most cases) to complete a valuation form, submit seven photographs (front, back, each side, interior, engine bay, mileage reading and one including the registration number) and pay a fee of £15.
Can I change its value once my insurance has started?
Most insurers require re-certification every year, from their point of view to ensure the car hasn’t deteriorated or depreciated in the previous year. But, with some sectors of the classic car market showing sustained increases in values, it’s also in your interests to keep a sharp eye on the value of your car.
According to the Historic Automobile Group International, some sectors increased in value by 20 per cent in 2011, while its index of key collectable classics has increased by a compound average of 12 per cent a year for the past 30 years. So it pays to update your value at every renewal if you’re fortunate enough to own an appreciating classic.
You can also update your value at any point during your policy’s term, but you will need to supply new photographs, vehicle declaration and payment of the fee.
Can I include the cost of restoration in my car’s value?
No. In the same way that some cars are written off following damage because the repairs would cost more than the value of the car, some cars will almost certainly cost more to restore than they are ultimately worth.
Similarly you can pour hundreds of hours into doing the restoration yourself, but you’ll need to think of that as a labour of love rather than accounting for your time in the ultimate value of your car.
Is my value guaranteed in the event of a claim?
Good question. In theory, yes, and this will be the case in the majority of cases. After all, to give it its technical definition, “agreed value is an insurance contract under which the insurer agrees to pay the insured a stated amount in the event of the total loss of the property insured without any adjustment for depreciation or appreciation”.
However, in the event of a total loss – or possible total loss – insurers will want to inspect the vehicle to ensure that its condition at the time of the accident remains in keeping with that at the time of its agreed valuation.
If the car has clearly deteriorated (other than its obvious damage!) then the insurer is likely to offer the current market value.