The “Stated Value” Scam That Can Cost Classic Car Owners Thousands.
I “Stated” My Car Was Worth $30,000. They Paid Me $12,000.
I insured my classic Camaro under a “Stated Value” policy. I told the insurance company it was worth $30,000, and they based my premium on that. After it was stolen, the claims adjuster came back and said, “Based on our market research, the Actual Cash Value is only $12,000. We will pay the lesser of the Stated Value or the Actual Cash Value.” I was robbed twice. “Stated Value” is a scam. It’s a worthless number that only benefits the insurance company.
Agreed Value: The Handshake Deal That Guarantees You Get Paid What Your Car is Worth.
We Agreed on the Value BEFORE the Accident.
For my restored GTO, I chose an “Agreed Value” policy. My agent and I agreed, right upfront, that the car was worth $50,000. We signed a contract based on that number. When the car was totaled in a garage fire, the process was beautiful. There was no negotiation. There was no depreciation. They simply sent me a check for the full $50,000 we had agreed upon. It was a simple, honest handshake deal that was honored without any hassle.
My ’67 Mustang Was Totaled. How an Agreed Value Policy Saved My Financial Life.
No Arguments, No Depreciation, Just a Check for the Full Agreed Amount.
I had poured my heart, soul, and over $75,000 into restoring my 1967 Mustang. I insured it with an “Agreed Value” policy for that amount. When it was totaled by a careless driver, I was devastated. But the insurance process was a dream. I called my agent. I sent them the police report. Two weeks later, a check for the full, agreed-upon $75,000 arrived. That policy didn’t just replace the car; it honored the value of my time, my passion, and my investment.
“We’ll Pay Up To Stated Value”: The Deceptive Phrase That Can Ruin You.
The Three Little Words That Give Them All the Power.
The most deceptive phrase in insurance is “up to.” A “Stated Value” policy says the company will pay up to the stated amount, or the actual cash value, whichever is less. This phrase gives the insurance company complete control. It allows them to collect a premium based on the value you’ve stated, but then gives them the power to pay you a much lower amount based on their own, self-serving assessment after a loss. It is a one-sided contract designed to benefit the insurer.
If You Have a Classic Car, This is the ONLY Type of Policy You Should Ever Consider.
Don’t Gamble with Your Passion Project.
If you own a classic, collector, or modified car, an “Agreed Value” policy is the only acceptable form of insurance. Period. The value of your car is subjective and not based on a Kelley Blue Book value. An agreed value policy removes all subjectivity. You and the insurer agree on the value of your passion project upfront, and that is the number that is contractually guaranteed to be paid. Do not ever settle for anything less.
The Appraisal is Everything: How to Lock in Your Car’s Value with an Agreed Value Policy.
The Foundation of Your Handshake Deal.
To get a true “Agreed Value” policy, you will likely need a professional appraisal. This is a good thing. A certified appraiser will document your car’s condition, its unique features, and its fair market value. You then submit this appraisal to the insurance company. This document becomes the foundation of your agreement. It is the proof that justifies the value you are insuring, and it is what makes the claims process so smooth and simple down the road.
Don’t Let an Insurance Company Decide What Your Special Car is Worth After a Crash.
You Are at Your Weakest. They Are at Their Strongest.
The worst possible time to negotiate the value of your classic car is after it has been destroyed. You are emotional and at your weakest. The insurance adjuster is unemotional and at their strongest. They have algorithms and databases designed to justify the lowest possible payout. An “Agreed Value” policy completely avoids this conflict. The negotiation happens upfront, when you are on equal footing, and the value is locked in before the disaster ever strikes.
Stated Value vs. Agreed Value: One is a Guess, The Other is a Guarantee.
A Hope vs. a Promise.
This is the simple, powerful distinction. A Stated Value is a guess. It’s a number you provide that the company uses to set your premium, but it is not a promise to pay that amount. An Agreed Value is a guarantee. It is a number that you and the insurance company have both researched, documented, and contractually agreed upon. It is a firm, legal promise that that exact amount will be paid in the event of a total loss.
Why Hagerty and Grundy are Kings: The Power of True Agreed Value Coverage.
They Built Their Kingdom on a Foundation of Trust.
Companies like Hagerty and Grundy are the undisputed kings of collector car insurance for one reason: they built their entire business model on the promise of “Agreed Value.” They understand the passion and the investment that goes into these cars. Their entire process, from the upfront appraisal to the claims handling, is designed to be a partnership with the owner, not an adversarial relationship. They sell a guarantee, and their reputation is built on honoring it.
The Single Most Important Question to Ask Before Insuring Your Collector Car.
The Words That Can Save You a Fortune.
Before you sign any insurance application for your special car, you must ask the agent this one question: “Does this policy have ‘Agreed Value’ coverage, and can you show me where it says that in the policy language?” Do not accept “Stated Value” or any other vague term. You must see the specific words “Agreed Value” in the contract. That simple act of verification is the single most important thing you can do to protect your investment.