Agreed valued insurance policies and actual vehicle valuation

[tirwin]

I'd like to get some feedback about the experience others have had with agreed valued insurance policies and vehicle valuation. I learned something new today about how my current insurer does their valuations and I'd like to get some feedback from the Pelican brain trust.

Today I have an agreed value policy on my '83 SC with my insurance company. I got my annual notice in the mail the other day that it's time for my policy renewal. As the market has increased over the last few years, I've had to keep increasing my agreed value to keep up with increasing values.

It just so happens, I took my car in last week to get the headliner replaced (sunroof snagged a loose piece of material and ripped it -- that's another story). Anyway, the guy that is doing the headliner replacement is a restoration expert and concours judge. About 2/3 of his work is Porsches. Point is he knows what he's talking about.

Anyway, I talked to him this morning and so I thought I'd ask him to value my car. I told him I'm just wondering for insurance to make sure I'm not undervaluing it. The current agreed value is $36k. He said he thought I was a least $15k underinsured without hesitating.

Armed with my highly scientific statistical sample size of 1, I called the insurance company and asked what my options were. They told me max agreed value is $40k for a car like mine.

I asked them how they derive that and their explanation is that they use Excellence and eBay auctions to value cars. They also will not take into consideration an individual appraisal. My understanding is that they only insure for a general market value, which is not necessarily what an individual car may be worth, and they only base their valuation on actual sales prices (not asking prices, so they don't count for sale ads).

I checked the Hagerty market valuation tool and came up with these numbers:

Category #1 (Concours) $62,000
Category #2 (Excellent) $44,200
Category #3 (Good) $28,400
Category #4 (Fair) $14,600

I don't know how Hagerty derives their valuations but it is seems higher than my current insurer.

We could debate whether my car is 'Excellent' or on the low end of 'Concours' but that's not really the point. I've done a tremendous amount of work to the car and it looks great. My goal is to properly insure the car and nothing more. The cost of insurance in this case is cheap - we're talking about a little over $120/yr increase to insure it to $50k based on the current pricing. I would be willing to pay the marginal price increase to insure it to say $50k but they won't let me unless I can come back to them with some proof of a car similar to mine selling at that price.

All this leads me to the conclusion that I should talk to other insurance companies. I'm wondering if other people have had similar experiences in negotiating agreed value policies. If I was asking for something completely absurd, I can see their hesitation, but again, other data sources seem to validate that $50k is not entirely off base.

What do you guys think? Get a quote from another insurance company?

Has anyone talked to their insurer about how they arrive at a mutually acceptable agreed value?

Has anyone had an appraisal done and had the insurer use it in coming up with an agreed value?

[steely]

Tim, I can't advise you, but I can give you my meager experience with my ins-co.
They automatically bump the ACV by some fixed percentage, but last year I called to increase it even more, since their auto-increment amount had been out-paced by the market I felt.

This told me that they don't spend the effort on the individual car, but they took my request, and with me on hold they consulted their underwriter, and immediately agreed to my number, no questions asked. I was prepared to get an appraisal and / or bring it in or provide pix if needed.

Using the same Hagerty tool that you used, I guess I come in between a #2 and a #3.
The car is mechanically great and well maintained, but my paint isn't what it used to be.

Anticipating a significant premium increase, I was surprised when they lowered my premium, since according to them, the coverage reached some sort of threshold.

Apart from my narrow experience, the pace of the car valuations in the past 2 years is also something that I am not fully accustomed to dealing with, but it seems to have worked out.
My only concern now is being perpetually under-insured.
For info, I increased it $5K each of the past 2 years to $32K. It's probably already gone up since then (Jan').

[tirwin]

Thanks, Dan.

Probably 3 years ago my insurance company said I was underinsured and I've increased the agreed value every year since. I've been loosely tracking the market but with the work I've continued to do and the continued run up, I guess I wasn't paying close enough attention.

I guess I don't understand the insurance company. I'm willing to pay for a higher agreed value so I'm a little surprised in their unwillingness to insure it for my number. I could understand if I was asking for something totally out of bounds but that isn't the case. My guess is Hagerty would be willing to give me a policy with a higher agreed value so I can't understand why they won't work with me on this.

[11and14]

I've valued my cars with Hagerty between Category2-3 values which I feel they are, not sure if others do, but Hagerty hasn't hesitated with these values. But I have no idea if pushing these values closer to a Category 2 would meet more resistance, i.e. a threshold.

Anyway, it doesn't take long to get quotes, and in my opinion it never hurts to shop around - you either find a better deal, or become more comfortable with your current plan.

[Eclectic911]

I recently bought insurance from Grundy, after getting a quote from Hagerty.
Grundy quoted about a third less for the same coverage.

[SCadaddle]

Subscribed.

I've got to do something with my SC regarding finding a classic car insurer. It's been on my Geico policy with just liability and uninsured motorist coverage for the past 4 years. Only recently found out that my local agent, no longer in business, failed to fax the completed document Geico sent me last year questioning the mileage I drive my 911.....they had me down as driving it 5 days a week to school. I'm almost 54 years old. Aint been officially schooled in a long long time.

[tirwin]

11and14 and Eclectic911, that's good to know. I have checked with other insurance companies in the past. I found a couple of things.

1) current insurer (Leland West) was cheaper and generally gave me less stipulations so I felt like it was a good deal.

2) apparently several insurers use the same underwriter - American Modern Home. That makes me wonder how the underwriting process really works. Why would Company A be unwilling to do my number for agreed value and Company B would if they are using the same underwriter?

SCadaddle,

There are some specific rules for collector car policies -- can't be a daily driver, must have 1 other primary vehicle for every licensed driver on the policy, the primary vehicle coverage must be through a 'regular' insurer, have to match the same coverages as on the primary vehicles, must be kept in an enclosed garage, some may limit annual mileage, etc. If you meet the requirements then I have found the collector car policies to be much better coverage and significantly cheaper than regular insurance.

[Rawknees'Turbo]

Tim, American Collectors uses NADA as their agreed value price guide - aka, the amount you want must fall within NADA's published spread. I don't know if they make exceptions, butt they probably do. They don't ask for appraisals (no mention of it, even).

I have a 7K a year mileage limit, but they have never asked for any verification of such.

[tirwin]

Originally Posted by Rawknees'Turbo

Tim, American Collectors uses NADA as their agreed value price guide - aka, the amount you want must fall within NADA's published spread. I don't know if they make exceptions, butt they probably do. They don't ask for appraisals (no mention of it, even).

I have a 7K a year mileage limit, but they have never asked for any verification of such.

Ah, that makes sense. NADA values seem to align with what the insurance company said -- $40k on the high end of the range.

1983 Porsche 911SC Value | 2 Door Coupe Prices and Book Value

I started looking at Bring A Trailer. There was an SC that was a little higher mileage than mine that sold for mid $40k. I think I'll check with some of the auction sites and see what I can find. They seemed willing to discuss if I could provide data. Still, it never hurts to shop around.

[rrcrawford70s]

try Chubb?

I have both my 1970 911 S coupe and 1972 911 S Targa with Chubb. Many friends who have early 911's have made the switch from Hagerty, Leland, etc. to Chubb.

Chubb offered better coverage for lower rates.

email Jeff Walker at Chubb
jwalker@chubb.com

Classic Car Insurance | Collector Car Insurance | Chubb

[tirwin]

Thanks, Ray. I was not familiar with Chubb -- I just filled out a form online for a detailed quote. The initial number I got from them was promising. If I extrapolate out what the cost of a $50k agreed value policy is with the current insurer (Leland - and that's assuming I could get them to agree), it's about the same price as the initial price I got from Chubb. Let's see what they come back with on the detailed quote.

My regular cars are insured with Amica. I talked to them and they would only do a standard policy but they said their partner for classic car insurance is Hagerty. So I requested a quote from Hagerty and they did not balk at my $50k agreed value number but they were 3X the price I'm currently paying and probably 2X what agreed value with Chubb might be. Even if Hagerty gave me some kind of discount for being an Amica customer, that seems like a big gap.

I will get a few more quotes and report back.

Appreciate the input.

[jwill911]

Since I'm just now in the process of revaluing my car with my insurance company this thread has caught my interest.

NADA is considerably lower than Hagerty in their valuation:

MSRP Low Average High
$38,500 $25,000 $30,500 $52,100
The only options allowed by NADA for an 87 Carrera Coupe are Slant nose and wide body.
Original MSRP is way below what my window sticker shows, original owner paid ~$48000, has LSD, auto heat, air, full power drivers and passenger leather, seats, 16" wheels, upgraded to 7&9/16, F/R spoilers, and special order paint.
My insurer wants updated photos including the odometer which they submit to underwriting. I may be shopping for a new insurer based on the feedback from this thread. BTW referencing the Hagerty valuation tool I put my car at between
#2 Excellent $51,400 and #3 Good $32,300, somewhere in the $40K range.

Thanks to all

[tirwin]

jwill911,

I've been getting several quotes this afternoon. So far I've talked to 4 new insurance companies. They all seem to have their own nuances on how they offer policies for Liability, Uninsured Motorist, Collision, Comprehensive, etc. Because of that, it is not completely an apples/apples comparison but it's close enough.

So far, here are the results ranked by annual cost (least to most). These rankings assume $50k agreed value, $250k/$500k Liability, $250k/$500k Uninsured motorist and $1000 comprehensive/collision deductible.

1) Chubb
2) Grundy
3) American Collectors
4) Hagerty

Hagerty is 50% higher than Grundy or American Collectors. Chubb is significantly cheaper than anyone else. Grundy and American Collectors are rounding error to one another - less than $10 difference.

I imagine Leland and Chubb would be very close. That is if Leland could get their head out of their rear. I'm going to talk to them again, but so far none of the other 4 companies has even flinched at my $50k number. Leland is about to lose a loyal customer. Why they won't they come up to my number is beyond me.

When I started investigating this yesterday, I thought maybe I was way off the mark with the $50k number but talking to other insurance companies suggests that is not the case. The rest are more than happy to have my business.

After I hear back from Chubb with the detailed quote I'm going to talk to Leland one more time and give them another chance.

Any other recommendations on insurance companies? Going once, going twice, ...

[ScottT80]

I personally have used Hagerty for almost ten years now and have had them for the 911 since I bought it. No complaints with them really but I haven't had a claim either. I think I need to reevaluate the value on my 911. Seeing your posts makes me wonder if I should look into other companies.

Hagerty has been pretty easy to deal with, much more so than my regular Allstate guy who was very uninterested a decade ago in providing classic car insurance.

[Esel Mann]

Leeland West pulled the exact same crap on me as far as agreed valuation. They said their valuations are based upon actual sale prices. I informed them that actual sale price is private not public information and that I highly doubted the underwriters had such details (even DMV sale prices are typically manipulated for tax purposes). I then requested they provide examples from which their agreed valuations are based. That request returned the sound of crickets.....

The way it appears insurance has changed in the sense it is no longer about covering so you have total replacement. Instead it is more about covering so you don't have a total loss (parallel experience with home coverage today as well). So while my agreed value from Leeland West won't cover for a total replacement, it is enough so that I don't have a total loss. Additionally I get the added benefits of unlimited annual mileage and occasional use for errands and work commute. This ensures I am not violating coverage conditions, which if violated, the agreed value would be meaningless and the loss total.

[coldstart]

I would make sure that you insure your car for its true value rather than haggle over an extra $50/year. I am in a similar situation:

• Hagerty yesterday increased the agreed value amount of my policy by approximately 50%. They also increased the premium by almost 50%.
  
  
• Hagerty agreed to use their condition No. 2 (excellent) for my car. My car is between a No. 2 and No. 3.
  
  
• The No. 2 valuation is still approximately 20% below what I have been actually offered for my car-- if you include taxes and USD exchange. Hagerty wouldn't let me increase the value above condition No. 2 valuation without another appraisal by an appraiser on their list.
  
  
• I may just sell the car as valuations have become crazy in the past few years and I like to drive my cars. It gets harder and harder to drive a great small car without side impact beams and airbags with all of the: (1) traffic; (2) texters; (3) SUVs; and (4) lazy drivers in the city.

I have a dash cam on my daily driver for those 'who do not pay attention'.

[steely]

Tim,
I should have mentioned that I insure mine as a collector - big diff of course.

I started and maintain with Grundy going on 9 years now. I don't understand exactly, but they paired with someone else some years back, but I think they re-grouped, so there is Grundy Worldwide and just Grundy (two sites), or at least there was last time I checked.

My other DD's are with USAA (30+ yrs), and IIRC they partner with American somebody for classics. They've also broadened their clientele base greatly (and started advertising) - remains to be seen if this is as good for the customer as it seems to have been for them, FWIW.

[tirwin]

We've all heard the adage that insurance is a numbers game. The trick to being profitable is getting the right customer mix. The 'secret sauce' for an insurer is having better actuarial tables and how good you are at identifying good and bad customers and pricing accordingly. The rest is just marketing and maintaining a positive brand reputation.

What is interesting to me is that you would think the overall collector car insurance market would be relatively good business compared to insuring daily driver vehicles. Most collector vehicles aren't driven as much and as a general rule they are going to be maintained by people who generally care more about that sort of thing.

The flip side is older cars lack the safety features of modern cars so there is probably more risk of serious injury in an accident. And of course as cars appreciate in value, the payouts are probably much bigger when they do happen.

Consider the market run up in our cars. When I joined Pelican 5 years ago it seemed like there was a much higher frequency of people looking to buy '80s 911s. The rule was low teens got you in the game and high teens was a great car. People said "they are all $20k cars." Not so anymore.

But Porsches aren't unique in this regard. A few years ago a Dino was a poor man's Ferarri. That market exploded.

So that brings me back to the business of collector car insurance. I've now talked to 5 insurers (current + 4 prospects) and there is a pretty significant spread - 3X from lowest to highest. Why is that I wonder?

It makes me wonder if each insurer has a 'sweet spot' for the kinds of people and cars they insure. On the low end, I must be getting out of Leland's since they seem (at present) unwilling to work with me. Maybe they were great when my car was a $20k car but maybe they see the market changing and I no longer fit their ideal demographic. On the high end, I must not be in Hagerty's sweet spot either (though I'm sure they would be happy to take my money). I can't seem to justify how they could be so high compared to the others.

This has been a curious exercise.

If anyone has any other feedback I'm all ears.

[RichardNew]

So far this whole discussion has been about cars that get driven. What about that project car in your garage? The one that's not licensed and has been there for 6 years. It's not covered under your home owners policy. It probably has no insurance at all. Project Car Insurance.



You finally take the car to a good Porsche shop to get it running and the shop burns down. The insurance company that insured the shop could care less about your car. Do you have an advocate? Who is going to make you whole? Who Insures Your Car When It's in the Shop?


Richard Newton

[steely]

Yes, the 'run-up' sort of took me by surprise too.
I'll go with the sweet-spot theory. (aka demographics, income, zip code, annual mileage, plus magic)
I'll just add too that some companies give you a discounted rate on the daily driver type of insurance if you have your homeowners with them as well. I'm not saying it's news, but it did play a key role is my decision when I was rate shopping for my dd's last year. (rule didn't apply to my p-car)