Tom Gentry wrote:
> My understanding about "stated value" insurance is that you still need to
> prove the car is worth what you state. So just because you stated $20,000
> doesn't mean that's what the insurance will pay. If that was the case, I
> could buy a 82 K car, insure it for $20,000 and drive it off a cliff.
> Instant $19,500 profit.
>
> Please correct me if I'm wrong.
What you say is precisely correct: In the case of "stated value" coverage,
you may need to prove that the car is worth the amount claimed - the so
called "stated value" is merely the upper limit of what the insurance
company can be required to pay in the event of a total loss.
What you really want is "agreed value" insurance, where you and the
insurance company have agreed (at the time the policy is issued) what the
value of the vehicle will be in the event of a total loss. Such policies
virtually always require an appraisal before the policy is written. What you
save here is having to hassle with the insurer if there's a total loss.
What's much more likely to happen, however, is that you'll have a claim for
repair: The insurance company will want to fix the car on the cheap and you
want to repair it to the same standards that you've restored it to. That's
when it's really handy to have an agent who knows you, knows your car, and
wants to keep your business (auto, home, business, life, etc).
Jim Hill
Madison WI
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