[pmax]

Originally Posted by Zeke

I would only be guessing and using personal experience in that scenario. What I think would happen is that the ins co would give you the 20K and take the car to sell to a salvage yard. Of course you can arrange to buy it as stated in a previous post. They will simply deduct the salvage value from your settlement.

What if the car auctions at $25K in the example ?

Does the insurance company keep the extra $5K ?

So to sum it up, 70% plus the salvage value justifies them cutting off the damage payment at a certain percentage. And if you know the collision business you know that the estimate usually goes up after the work is started and concealed damage is revealed. If the damage estimate is 50% of the value of the car, they can absorb some additional cost.

To further the point, they value a vehicle at wholesale rather than retail unless you have that agreed value.

Is that the case about the wholesale ? I thought the insurance company has to pay the replacement cost.

If I were to answer your original question, I would answer yes. And if I was in that position, I'd increase the agreed value accordingly.

The agreed value insurance looks like the odd one where the owner sets the value of the property. Isn't it the case that the owner bears all the risk of valuing the properties correctly in agreed value whereas with cash value insurance, in an ideal world which might be a high bar but not impossible given the comps are now readily accessible, the insurance company pays you what it's worth and bears that risk ?

I guess that's why the insurance company would have no issue with underinsurance but would require an appraisal for over. I think I can see now how the game is stacked in their favor in both cases, no surprise there.