Agreed value vs. stated value

Understanding how claims might be settled is crucial when you have car insurance. This information will help you choose the best policy for you and help you to set realistic expectations in case you need to file a claim. This is especially important for classic and antique cars because insurance may work differently for them.

Car insurance policies are usually settled on an actual cash worth (ACV). When you file a claim, a claims adjuster will examine the condition and age of your vehicle and subtract depreciation. Some car insurance providers offer different settlement options for specific types of vehicles. ACV policies are different from ACV policies in that they have different policies for agreed and stated value. These differences can help you choose the right policy for you and your vehicle.

What is the agreed value of insurance?

When you and your insurer agree on the value of your car, it is called agreed value car insurance. You will receive either the agreed value or the cost to repair the damage to your car if it is damaged.

This option may be chosen to avoid depreciation. You can lock your car’s value with your insurance company to protect it from market decline. Auto insurance with agreed value may be an option if you have done a lot to your car such as restoring its original features.

What is the stated value of insurance?

With stated value insurance, things are more complicated. While stated value insurance still places a value on your vehicle’s value, the company will not pay the amount for damage to the vehicle. The stated value is basically the maximum amount you will receive. The company can pay you based on your vehicle’s stated value, current cash value, or the cost to repair it, if the vehicle is damaged.

You can undervalue your vehicle with stated value policies, which will make your premium payments more affordable. This approach is risky because it can lower the amount that you will receive if you file an insurance claim. It might be worth talking with your agent about the advantages and disadvantages of stated-value policies before you make a decision.

Insurance coverage for classic and antique cars

Different vehicles require different services. This is especially true for classic and antique cars. These cars are more valuable than standard vehicles and could have been subject to expensive restoration work. You should therefore carefully consider your car insurance requirements.

You will find the same coverages for antique and classic cars as for your daily vehicle. You may also have the option to choose an agreed-on or stated value. To protect your financial assets from the additional cost and complexity of replacing or repairing these special cars, consider the following coverages:

  • Comprehensive: This coverage covers damage to your vehicle from things like theft, vandalism or hitting an animal.
  • Collision: This coverage covers damages to your vehicle that are caused by collisions. This covers you colliding to another vehicle. However, it also covers damage you cause to your car by hitting a tree, pole, or building.
  • Roadside assistance: There are many companies that offer special roadside assistance for antique and classic cars. This can include a flatbed truck or soft tie-down straps to protect your vehicle.
  • Tools and spare parts coverage. If you have restored your vehicle yourself, you will likely have some tools. These items might be covered by your auto policy.
  • Automobilia coverage: Some auto insurance policies provide coverage for classic automobiles, such as hood ornaments or wall decor.

Many insurance companies offer special policies for antique, classic or modified cars. These policies can be similar to standard policies, but they are tailored to the specific needs of each vehicle.

Questions frequently asked

Can I insure a car of agreed or stated value?

Most likely not. If you insure a classic, antique, or modified vehicle, you usually can only choose either agreed or stated value coverage. This coverage is not available for private passenger cars that you use every day.

Are agreed or stated values better?

Your vehicle, financial situation and intended use will determine which option is best for you. Although stipulating a stated amount of insurance will save you money in the short-term by lowering premiums, it may result in a lower payout if you file for a claim. Although it is more expensive, agreed value insurance can provide better protection for antique, classic and modified vehicles. A licensed agent can help you evaluate your options and determine which option is best for you.

Which is the best company to insure classic cars?

Your individual rating factors and preferences will determine the best car insurer for your antique or classic car. This is just like other types of insurance. Car insurance policies can be complex enough that the best policy for one driver might not work for another. Different types and limits are beneficial for different vehicles and people. It can be useful to know what you need from a policy, and get quotes from multiple companies.

What is the cost of car insurance?

The average cost of full coverage car insurance in the United States for is $1,674 annually. Your price will depend on many factors. How much you pay will depend on the insurance company you choose, what coverages you buy, and your driving record.