Market value is easy to understand as that is the expected amount that the vehicle is valued at in the open market. Agreed value is a concept that might be new to you and simply stated, it is the amount that the insurer and the vehicle owner will agree upon to be the value of the car. There are industry guidelines to follow as this agreement is being made and a reliable collectible car insurance agency will be able to inform you of the guidelines and in the event that the unit covered by the insurance policy is stolen or is declared as a total loss from an accident, the claim amount that will be paid will be the Agreed Value Insurance rate.
Maybe you are the owner of a collectible car and want it to be properly insured. There are those who may tell you that to get a standard policy is sufficient enough coverage but that is a common misconception. Insurance is based on the principle of helping the person become “no better off, no worse off” than when an accident or some other incident occurs and if the collectible car coverage based on market value then you cannot recover your all losses.
The vehicle that you own may be worth a lot and is a treasure and it would be such a waste of money to pay a premium to be able to undervalue the car. This kind of insurance is available for only collectible cars. If you want to insure a collectible vehicle and have an insurance policy based on agreed value, please request a classic car insurance quote.
About the Author
Drew Yagodnik is Vice President of Classic Automobile Insurance Agency, Inc. Classic Automobile Insurance Agency has been protecting collector, classic and exotics since 1992.