Author Topic: Car valuation for insurance purposes  (Read 1910 times)

milnes

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Car valuation for insurance purposes
« on: April 01, 2013, 04:28:59 PM »
I thought this would have been discussed before but my search comes up with zero results.

I've got my Micro car collection fully insured, for both road going and laid up cars. But have i got the insurance value correct? If i value them to high, i guess my premium would rise and the insurance company may not agree on my value when it comes time to pay out.
So what are the other forum members doing when it comes to insurance values of their cars?

I will give you an example, i have an AC Invacar, it's scruffy but has an MOT and is road worthy. My insurance value is £2,500. Is this a fair valuation, to high, to low?
I need to stop buying!

Jim Janecek

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Re: Car valuation for insurance purposes
« Reply #1 on: April 01, 2013, 04:44:43 PM »
You must have an insurance policy that pays on "agreed value" or they will figure that, with depreciation, an old vehicle is worth nothing now.
In the States we have a number of "Classic Car" insurance companies that do just that.
The premium does rise with the amount you claim the value to be.  The vehicle is also limited to certain types of driving (cannot be a daily driver) and must be stored somewhere indoors usually.  If stored outdoors, or at another location, they may declare the policy null and void if you make a claim.

They don't always accept whatever number you throw out either.  Apparently some people have abused the system in the past by declaring outrageous amounts for "value" and then the car magically gets totaled by accidentally sliding into a lake or something.
For oddball items that they don't have in their database, they may require some evidence of value such as sold prices of identical or similar items.  This evidence can be auction results or other such publicly available information.

Big Al

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Re: Car valuation for insurance purposes
« Reply #2 on: April 01, 2013, 05:21:13 PM »
The agreed value part of a policy should be easy. Insurance is based on risk. It is for you to tell the insurer what the risk is. Clearly some of that is contentious and insurers protect themselves with complex legal terms of business. If they catch you lying, you will loose value for the deception. The value of the thing is not huge in the range of risk, unless it is undervalued or overvalued. If undervalued, the insurer has no problem. If overvalued the insurer might choose to challenge despite accepting the contract. Of course the value is a component of the value of the deal so a higher value means a higher premium.

So a proper agreed value policy will ask for the valuation. It used to be that insurers asked for several pictures, an independent valuation or the invoice for the purchase of the vehicle, if very recent. There is no reason not to to supply those item anyway and clearly mention them in the correspondence. It is then beholden on the insurer to reject that evidence. An invitation to send the premium means they must have accepted the documents. Remember that is docs first, payment second, otherwise your back up information is not binding. Normally an insurer will come back if they are unhappy with a valuation. That is clearly more likely on a vehicle they have never heard of.

Always pays to check out the small print. What is the status of the car in transit not being driven? At a show where it is unattended on public or private ground. That sort of thing. Can be some nasty surprises. Fav is folk bombing about on a field and driving into each other to find they are not insured. I had that with some long hairy git leaping in my KR175 without so much as a by or leave and driving into Bob Cotton's Bond MkA, I think it was, driving along minding its own business. Who pays?
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