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Agreed Value Insurance vs. Stated Value Insurance
What are the Differences Between an Agreed Value Insurance Policy and a Stated Value Insurance Policy?
When it comes to classiccars, agreed value and stated value insurance are two common options forenthusiasts. However, they are very different and only agreed value providesthe proper coverage for a classic collector vehicle.
Do you already know that you’ll need insurance for your classic car? No problem! Get a quote from the experts at OpenRoad Insurance today or continue reading to learn more about the key differences.
What is Agreed Value Insurance for a Classic Car?
Agreed value insurance is a policy that sets a fixed amount payout on a total loss claim before the loss occurs. This means that the amount agreed to by the classic car owner and the insurance company is set and will not change in the event of a total loss.An agreed value insurance policy eliminates any concern for depreciation and ensures that you get a set amount if your classic car or truck gets totaled.
This is viewed as a preferred option for a high-value asset like a classic car that may appreciate in value over time. It’s also a good option if you have an asset that has a value that’s dependent on market conditions.
Let’s say you purchase a classic car and get an agreed value insurance policy with OpenRoad Auto Insurance. Then, a few months go by, and your classic car isn’t quite as hot as it was when you made the purchase, and its perceived value decreases. You’ll still be protected and be able to get the agreed value set in your insurance policy.
How is Stated Value Insurance Different?
A stated value insurance policy is different from agreed value insurance in primarily one significant way. With a stated value insurance policy, you declare a stated amount for your asset, and that’s the maximum payout limit.
If you’re involved in an accident and your car is deemed to be a total loss, a stated value policy allows the carrier to determine your vehicle's value in the current market and pay you an amount they decide.
The value you stated when you purchased the policy, and have been paying premiums for, is not the amount that you will receive.
Are There Benefits to Agreed Value Insurance?
Yes, the key benefit to keep in mind with agreed value insurance is that this type of insurance policy doesn’t take depreciation into account.
Also, an agreed value insurance policy pays a fixed amount that isn’t dependent on market forces.
Do Agreed Value or Stated Value Policies Require Appraisals?
Some insurance companies require photos or an appraisal to confirm a classic or collector car's value before providing an Agreed Value policy, but not OpenRoad Insurance.
With in-house expertise, OpenRoad has removed this requirement in most cases, making it easy for classic and collector car owners to purchase an Agreed Value policy.
Stated value insurance policies don’t always require an appraisal to begin coverage. The value in the policy is based on an assessment by the insured. An insurer may require documents, photos, or an appraisal to establish value, but this may not always be the case.
Do Agreed Value or Stated Value Policies Require Appraisals?
Yes, serious risk. In a total loss accident, a stated value policy will only pay the insured the current market value of their car, not the amount they insured it for or paid for their vehicle.
A stated value insurance policy also leaves the insurance company with the right to determine the value of classic and collector cars. Specialty car valuation is not a skill most insurance companies have. Meaning that an owner will likely be paid less than their classic car is worth.
How Can I Choose Between Agreed Value and Stated Value Insurance?
If your vehicle qualifies for an agreed value policy, there’s no reason not to get a quote. The coverage offered through an agreed value policy provides owners with additional peace of mind knowing that if the worst case occurs, they’re fully protected at the value they agreed to.
On top of better coverage, specialty carriers such as OpenRoad often have better pricing and rarely require photos or appraisals to buy a policy. If it’s fast, easy, saves you money, and provides you with better coverage, it’s a simple choice.
Can I Get an Agreed Value Quote for my Classic Car?
If you know that an agreed value insurance policy is right for you, a quote is a lot closer than you think. Simply apply today and get a quote from our experts.
Do you have questions about classic car auto insurance? Give us a call at 1-866-952-7622 or send us a message.