Insurance 101 basics
I just read a post from a couple of days ago the, for some reason, concerned me. A member was posting that his rates with one company nearly doubled, and he switched to save money. Citing "agreed value" as part of his decision always raises the hair on my neck. I spent over 25 years in the insurance industry as an agent, and you would be very surprised how little most people, including some agents know about what agreed value is. The two companies discussed in the post that have true "agreed value" policy forms are Hagerty and Grundy.
Guys, read your policies very carefully. If the policy doesn't say "agreed value" on the policy declaration page (that's the page that shows the insureds name address and coverage limits, and in the definitions or what we will pay section of the policy for damage to your vehicle, you probably don't have "agreed value" coverage. Look for words like total loss or constructive total loss, and phrases like the amount necessary to repair or replace the property with similar kind and quality without regard to depreciation or betterment. Remember, you are buying a legal contract, and the insurance company will only pay what that contract requires them to pay. They are not obligated to hold your hand and help you make the right choice in buying your insurance.
Unfortunately, most insurance companies don't have either the knowledge or the ability to write a true agreed value policy form for your classic car. If they did, they'd do like Hagerty and Grundy and specialize. They are all generalists. They write homeowners, businesses, moms soccer wagon, you dad old fishing boat. Most don't have a clue what the value of a 1967 427/435 is worth, or where to start looking. Futhermore, the time for you to learn they don't isn't when your baby has come up missing or destroyed and the claims adjustor is standing there with a check for $8,000 wanting your keys and title.
You didn't spend $20 on that set of Walmart plug wires, you spent $100 for the date code correct wires. My suggestion is don't penny pinch on the insurance for your baby. I'd rather know I'm getting my check for $50,000 when that car winds up trashed and have spent $300-500 more for a years worth of insurance. In the long run, that $300 more per year will hopefully be money you'll wish you never spent, meaning you'll never have a loss. But, if you go the cheap route now, you may wind up kicking yourself in the butt when you get that knock-off hood that doesn't fit and the State Farm adjustor (just an example) says "well, the body shop guys said he would make it work."
If you want to go the cheaper route, that's your choice. But, ask your agent to put it in writing that you have true agreed value coverage. I did. That's why over a year ago I left American Family and went to Hagerty.
Guys, read your policies very carefully. If the policy doesn't say "agreed value" on the policy declaration page (that's the page that shows the insureds name address and coverage limits, and in the definitions or what we will pay section of the policy for damage to your vehicle, you probably don't have "agreed value" coverage. Look for words like total loss or constructive total loss, and phrases like the amount necessary to repair or replace the property with similar kind and quality without regard to depreciation or betterment. Remember, you are buying a legal contract, and the insurance company will only pay what that contract requires them to pay. They are not obligated to hold your hand and help you make the right choice in buying your insurance.
Unfortunately, most insurance companies don't have either the knowledge or the ability to write a true agreed value policy form for your classic car. If they did, they'd do like Hagerty and Grundy and specialize. They are all generalists. They write homeowners, businesses, moms soccer wagon, you dad old fishing boat. Most don't have a clue what the value of a 1967 427/435 is worth, or where to start looking. Futhermore, the time for you to learn they don't isn't when your baby has come up missing or destroyed and the claims adjustor is standing there with a check for $8,000 wanting your keys and title.
You didn't spend $20 on that set of Walmart plug wires, you spent $100 for the date code correct wires. My suggestion is don't penny pinch on the insurance for your baby. I'd rather know I'm getting my check for $50,000 when that car winds up trashed and have spent $300-500 more for a years worth of insurance. In the long run, that $300 more per year will hopefully be money you'll wish you never spent, meaning you'll never have a loss. But, if you go the cheap route now, you may wind up kicking yourself in the butt when you get that knock-off hood that doesn't fit and the State Farm adjustor (just an example) says "well, the body shop guys said he would make it work."
If you want to go the cheaper route, that's your choice. But, ask your agent to put it in writing that you have true agreed value coverage. I did. That's why over a year ago I left American Family and went to Hagerty.
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