I have a pair of 1985 Jordan 1 Chicagos. I bought them for $500 ten years ago. Today they are worth $25,000. If my house burns down, my standard insurance company wants to write me a check for $65—the depreciated value of a 40-year-old gym shoe. This is the difference between “Actual Cash Value” and “Agreed Value,” and it’s the most important concept you need to learn today.
Key Takeaways
- ACV is a Killer: Actual Cash Value = Replacement Cost minus Depreciation. For vintage shoes, depreciation is 100%. You get $0.
- RCV is Better, but Risky: Replacement Cost Value pays what it costs to buy it new today. But you can’t buy a 1985 Jordan “new” at Foot Locker. The adjuster might price it at the cost of a 2026 Retro ($200).
- Agreed Value is the Only Way: You and the insurer agree in advance that the shoe is worth $25,000. Total loss = $25k check. No questions.
- Appraisals Required: To get Agreed Value on items over $5k, you usually need a professional appraisal.
The “Why” (The Trap): The Definition of “Like Kind and Quality”
When standard policies promise to replace your item, they promise an item of “like kind and quality.”
To a sneakerhead, “like kind” to an ’85 Chicago is another ’85 Chicago.
To an insurance adjuster, “like kind” is a red and white high-top basketball sneaker made of leather. They will price it at the cost of a modern Jordan 1 Retro High OG ($180).
The Investigation (I Called Them)
I ran a scenario: A destroyed pair of 1985 Jordan 1s.
1. State Farm (Personal Articles Policy)
- The Method: They use Agreed Value (good).
- The Catch: I had to provide a bill of sale or an appraisal. Since I bought them years ago, I needed a current appraisal.
- The Cost: Approx $1.60 per $100 of value. For a $25k shoe, that’s $400/year.
2. Wax Insurance
- The Method: They integrate with StockX/market data.
- The Benefit: They automatically updated the value. I didn’t need to hire a third-party appraiser; their internal team verified the photos and market data.
- The Cost: Slightly cheaper than State Farm for high-value items.
3. Renters Insurance (General)
- The Method: Actual Cash Value.
- The Result: “It’s an old shoe. We pay $10.”
- The Verdict: Worthless for vintage.
Comparison Table
| Valuation Method | Payout for ’85 Jordan 1 | Premium Cost | Best For |
| Actual Cash Value | ~$10 – $50 | Included in Renters | GRs / Beaters |
| Replacement Cost | ~$180 (Modern Retro) | Included in HO | New Releases |
| Agreed Value | $25,000 (Market Price) | Extra (~1-2% of value) | Vintage / Grails |
Step-by-Step Action Plan
How to lock in your value today.
- Identify Your “Agreed Value” Candidates: Do not do this for every shoe. Do it for shoes where Resale >>> Retail (e.g., Off-Whites, Vintage, F&F pairs).
- Get an Appraisal:
- Contact a reputable consignment shop (e.g., Flight Club, localized vintage experts). Ask for a “Insurance Appraisal Letter” on letterhead.
- Alternatively, use recent sales data from StockX/Heritage Auctions for the exact same size/condition.
- Schedule the Item: Call your agent. “I want to ‘schedule’ this specific item with an Agreed Value of $25,000.”
- Pay the Premium: It will cost extra. Treat it as the cost of holding the asset.
FAQ
Q: If the market crashes, do I still get the Agreed Value?
A: Yes. That is the beauty of it. If you insured it for $25k and the market drops to $10k, and it burns down, you get $25k. (Note: Insurers may ask to re-appraise every 3 years).
Q: If the market spikes to $50k, do I get $50k?
A: No. You only receive the agreed value ($25k). You must manually update your policy limits as prices increase.
[IMAGE: A graph illustrating the widening gap over time between retail price ($180) and resale price (up to $25,000), with a marker showing where standard insurance coverage stops paying.]