How
do I get a valuation for my agreed value insurance policy renewal?
As a matter of policy the V8 Register does not offer
or provide insurance valuations of MGV8s.
A physical inspection of the car is necessary and the resourcing needed
for a valuation service to meet even a modest demand of say 5 valuations
a week (250pa) would need a team of volunteer valuers around the UK
with sufficient market and technical knowledge. Making classic car
valuations on the basis of photographs is not wise. The logistics
(time involved and cost of either the volunteer valuer travelling
to inspect a car or the owner driving to see the volunteer valuer)
would be a major concern over the viability and sustainability of
such a valuation scheme.
A valuation based only on inspecting a set of photos provided by a
classic car owner is not a way of providing a reliable valuation of
a classic car, but clearly a number of insurers, faced with rising
values for even mainstream classic cars like MGBs and derivatives,
have decided to use photo evidence and self valuation by the owner
with a review by an "in-house expert" as their agreed value
procedure. But it seems likely they have done that to avoid the requirement
of a written valuation from a specialist carrying out the necessary
inspection of the vehicle.
In a very competitive classic car insurance market, simplifying
the valuation evidence process for the customer, avoiding the inconvenience
and cost for customers of getting written valuations from specialists
and avoiding a heavy workload for the broker and insurer in processing
written valuations are clearly major considerations.
Marketing classic car insurance is based on promoting a good quality
service as a broker or insurer, offering a good scope of cover in
the policy, having simple procedures for taking out or renewing a
policy and offering competitive premiums. So for the important agreed
value feature of the policy a competitive offer has to simplify
the process to a good set of photos and an agreed value proposed by
the vehicle owner which are then reviewed by an in-house classic car
valuation expert. Clearly the expert will have mystic powers!
See
our article
Posted: 160401 & updated
180928 |
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With
rising classic car values over the last 18 to 24 months, many
MGV8 enthusiasts are prudently checking the agreed value they
have on their classic car policy to ensure they are not underinsured.
Up to modest values many insurers have been prepared to accept
self-valuations from the policyholder supported by a set of
photos. Several members have been in touch recently enquiring
whether the V8 Register is able to provide valuations. The simple
answer is that as a matter of policy the V8 Register does
not offer or provide insurance valuations of MGV8s. |
The
reasoning is a classic car valuation is a serious document forming
part of an owner's insurance contract with the insurer. Our
concern is that if the valuation is put to a test following
a serious claim, then the qualifications of the valuer could
become an issue investigated by the insurer or his assessor,
notwithstanding the insurer had accepted the valuation provided
by a valuation document for the agreed value part of a an agreed
value policy. To be able to value a particular classic car model
you need a close knowledge of the market and market values and
a good knowledge of the model and the condition classes. You
also need to make a physical inspection - making classic car
valuations on the basis of photographs is not wise. The resourcing
needed for a valuation service to meet a even a modest demand
of say 5 valuations a week (250pa) would need a team of volunteer
valuers around the UK with sufficient market and technical knowledge.
The logistics (time involved and cost of either the volunteer
valuer travelling to inspect a car or the owner driving to see
the volunteer valuer) would be a major concern over the viability
and sustainability of such a valuation scheme.
What form of valuation do insurers require?
For mainstream classic cars like an MGB or an MGV8, most insurers
offering limited mileage agreed value policies have for many
years accepted self-valuations supported by a set of photos
of the car when taking out or renewing a classic car insurance
policy. A few had required a written valuation from a specialist
based on a physical inspection of the vehicle. Now with good
MGV8s valued at over £15,000 it seems many of the leading
insurers operating in a competitive marketplace are developing
their valuations systems and have chosen to use a process where
a detailed set of photos has to be part of the customer's application
together with their self-valuation and then the insurer has
an in-house expert who checks the photos and values proposed
by the customer. For example a leading broker Adrian Flux
says on its website "when applying for an agreed value
policy it is important to include high quality photos to ensure
we can process the application quickly. At Adrian Flux we know
it's important for drivers to get the real, current value for
their car should they have an accident. Your photos help us
to assess the vehicle's condition and make sure you get the
right value if anything happens. As part of any agreed value
policy we will need to see high quality photos of your vehicle.
The work and care that people put into cars can often save them
from depreciation, and sometimes actually increase the value
of a car. Having photos of your car ensures that any modifications
or customisations are documented, meaning we can give you an
accurate value for your vehicle". They then explain how
to take a good quality and comprehensive set of photos. You
can see their agreed value advice on the Adrian Flux website.
Link
Beware the scrappage buy back surprise
In December 2012 the Federation of British Historic Vehicle
Clubs (FBHVC) reported in its newsletter that it had been making
enquiries into cases where specialist classic car insurers
have amended their policies regarding salvage rights in the
event of a total write off but appear to be using terms
that apply to modern vehicle accident conditions. The situation
with classic cars is different because, depending on the loss
category, many owners of historic vehicles would quite understandably
be unhappy to see their cherished vehicle declared a write-off
and crushed when several of the body panels, interior trim or
mechanical components could be salvaged and reused to good and
safe advantage. In cases where the costs of repair of major
damage may exceed the agreed insurance value the cars are considered
uneconomic repair cases by the insurer and are classed as a
Category C, but many classic car owners faced with that situation
might prefer to rebuild the damaged car. People close to the
classic car insurance market will often concede that how scrappage
is handled in various classic car policies is a "subject
which can be grey" but then typically add "where it
is permissible for the vehicle or parts to be returned to the
client, the insurer will always endeavour to do so. They add
there will usually be a fair charge for the scrap value which
is deducted from the agreed value payable on a major claim".
See our article in December 2012. Link
Take care
not have your car under insured
Hopefully our popular PriceWatch
series on market information and the news items on MGV8 price
trends seen in the market will alert fellow members to the need
to avoid underinsuring their MGV8. When an insurer accepts an
"agreed value" that is usually the market value
of the car. There is also the reinstatement value including
the cost of repairing a classic car with substantial damage
to its previous condition. That cost can very easily exceed
the agreed value in the policy. Where the cost of repair exceeds
the agreed market value then there are real concerns the insurer,
on paying out the full value in the policy, may then declare
the car a write off and then claim the ownership of the scrap,
inviting the policyholder to buy it back! Many policyholders
may not be aware of that condition may apply in their policy.
On that basis the policyholder could end up with a net payout
of less that the insured amount! So do read the policy document
with great care! See
our article |
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