Lotus Elan

Question for Insurance experts (Ideally Kim)

PostPost by: Jason1 » Mon Sep 15, 2014 4:28 pm

So having seen what has happened to Rich I am wondering if "Agreed Valuation" or "Market Value" is the way to go?

Rich's situation is gutting; he thought by agreeing a value for his car he would be able to replace his +2 but due to a rise in value he has under valued the car and is now in a terrible situation of not being able to replace the car following an accident that was not his fault.

So I have just insured my wife's Mini and have declined the "Agreed Value" option (and the extra ?15 fee) as I cannot see the benefit of "Agreed Value"? If the worse happens I will argue the value with one of these "no win no fee" guys.

Can someone enlighten me as to why "Agreed Value" is a good thing to have?

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PostPost by: UAB807F » Mon Sep 15, 2014 4:48 pm

I'd like clarification on that one as well. I have had my cars on agreed value policies since the days where people would argue that an Elan was "just a 20yr old banger and worthless", and having an agreed value did seem to mean something.

But now ? I don't know, maybe "market value" is more realistic given how we seem to have a steady increase in prices charged and recognition that even if it's 40yrs old, an Elan can't be considered as "just another old car". There are auction prices and recognised experts such as Paul Matty who could easily give an appraisal of pre-accident values, so perhaps "market value" is the way to go ?

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PostPost by: Elanintheforest » Wed Sep 17, 2014 11:34 am

So what is the market value of a Plus 2? It's anything between ?3k and ?30k, so which market value would you go for?

Agreed value is exactly that, based on what you and perhaps another 'authority' thinks that it's worth.

I've recently moved to Hagerty, who have a very grown-up way of dealing with this stuff. They have their own views of what the model is worth in the 4 different categories (perfect down to rough runner) and so long as your description of the car and your own valuation fits their view of what is reasonable, you get an agreed value. They are flexible though. I put one of my cars at 5 times their estimate for the car in showroom condition as it has 8000 miles from new (it's 25 years old) and they accepted that valuation, after examining 10 detailed photos of the car.

After renewing last year, they contacted me to say that one of my cars was possibly under-valued as prices had moved up...and they were right.

But at the end of the day it's up to each of us to look after our own affairs. Most of us know how good or otherwise our cars are, and ebay, Car and Classic, Pistonheads etc. gives all of us a pretty good understanding of how much it would cost to replace our car.

I certainly wouldn't go along with market value, unless you agree what sector (category) your car is in. In which case, aren't you putting forward an agreed valuation?

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PostPost by: Jason1 » Wed Sep 17, 2014 4:01 pm

Hi Mark

Yes I understand what you are saying but... the value now may not be the same as the value in 11 months. So if you agree a value of say ?10k now and the car gets written off in 11 months and the value has risen to ?15k you have under valued the car. Accepting "Market Value" means that in an event of total loss you should receive a settlement that means you can replace the car of similar condition without loss.

I have had a car written off in the past (market value insurance) and the settlement offer was low; I argued and supplied proof of similar vehicles for sale by dealers and the insurance company accepted this and upped their settlement.

The point is "Market value" will move with the market whereas "Agreed value" is fixed. The insurance settlement should put you back to a pre-accident situation which I cannot see "Agreed Value" doing whilst prices are rising?

Jason
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PostPost by: adigra » Thu Sep 18, 2014 12:20 pm

I've been thinking about this a lot too. As things stand you really need to have the car valued twice a year in order to keep it current. I've had my car on the "market value" policy for a while, and every year I tell myself I'll switch to agreed value, and have had the car valued last year, but that is now at least a few thousands off what I'd need to replace if it was written off.

I concluded, that for me at this time, the best thing is to keep detailed record of the car as it is, the condition, the upgrades, etc., as well as a all of the records, which will, hopefully, be substantial evidence of its value at any point in time.
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PostPost by: Elanintheforest » Thu Sep 18, 2014 4:47 pm

I think that these are unusual times, but I still don't see the point in revaluing twice. Just have a slightly higher value at the start of the term of the insurance. Most times the increase isn't any more than inflation, so an agreed value isn't a problem.

The values have risen more than normal in the past few years for sure, but that will surely level out, and maybe even drop, as soon as the investors find somewhere more lucrative to put their money.

What would be a problem, to me at least, is trusting that an insurance company has the same view of market value as I have! That's especially true where there is no market value, such as my Plus 2 with a BDA, or a 25 year old Jag with 8k miles on the clock, or Jim Clark's old Elan.

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PostPost by: silverlink » Fri Sep 26, 2014 8:43 pm

As Rich's car write off is an 'not at fault' claim why does he have to claim on his insurance? surely its up to the insurance company of the person who caused the accident to pay for replacement.
Can Rich not say to them 'I don't want money, just give me another car the same as the one your client has written off' I don't think market value should come into it.
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PostPost by: RichC » Sat Sep 27, 2014 6:25 am

.
You get rather fearful of dealing with 'the other persons insurance company' because they naturally want to minimise their losses (& try & screw you over).
You think your own insurance should have your best interests at heart and help you through the maze to the best outcome .
My experience is you're dealing with lots of different keyboard operators whose commitment to helping you is minimal
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PostPost by: silverlink » Sat Sep 27, 2014 7:19 am

Another thing I've just thought of, has Rich got legal cover on his insurance? most insurance companies always try and get you to op in to legal cover. If he has why not get them to go after the other person and his/her insurance company.
This is not just an ordinary car its a valuable classic and should be dealt with in a slightly different way.
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PostPost by: UAB807F » Sat Sep 27, 2014 7:40 am

RichC wrote:. (part quote)
My experience is you're dealing with lots of different keyboard operators whose commitment to helping you is minimal


gee, that statement is so disheartening but I suspect is the very real position these days. I've been fortunate in only having to deal once with insurers in recent years but it drove me crazy and has given me a very cynical view of the industry as a whole, so I really feel for you with this one.

Does the legal cover apply for pursuing the claim ? When we had an accident many years ago the legal cover seemed to concentrate on getting our excess repaid and claiming for injuries, not the cost of repairing our car, which seemed to be decided between the two insurance companies involved.

We're just so used to letting insurance sort out these things for us, and as the quote implies, they often don't have any real enthusiasm for the task, it's just "another case". I think if the procedure was that you could sue the driver personally through the courts then that might have an effect in shaking up all concerned.

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PostPost by: Routen Chaplin Lotus » Thu Mar 31, 2016 3:35 pm

Agree or Not to Agree, That is the question?

The boom in classic cars continues and rising values especially for the early Lotus cars continue to astound.

This has its obvious financial benefits but also its pitfalls, so is agreed value still a good option in the current climate?

Yes as long as you are diligent, for the majority on this forum we have bought our Elans because we love them, not as an investments but for the little gem that we know they are. That said you cannot ignore the fact that 10 years ago an Elan at ?25k would be unthinkable but now common place with the very best with a value north of ?40K and rising.

Agreed value takes negotiating a settlement out of the equation, you agree the value at the outset, a claim occurs and the insurers give you a cheque for this sum less any excess. Simple. But you cannot rest and think the job is done, if you do not amend the value from time to time you will be stuck at a figure that could well be less than its market value. So if you insured a car for ?15K say10 years ago and have done nothing with it since, should a claim occur you will be out of pocket. However, if you keep nudging the value on each year in line with the increasing market value or as a consequence of having that expensive re-spray then you will be fine.

Unfortunately we all lead busy lives and it is easy to overlook the importance of this or to be in a rush to renew having left it late to do so. Insurance is an important part of classic car ownership, treat it as an important part of your car and you will be fine, neglect it and you are heading for trouble.

The downside of nudging the value up of course is that the insurance premium will go up. But, with a typical Elan valued at ?35k the premium is still only around ?120 or so. This must be considered an absolute bargain to have the privilege to drive one of the best handling, beautiful and iconic sports cars of the 60s and 70s.

Fiberglass cars are costly to repair and so in an effort to avoid the car being written off, consider getting a reinstatement clause added to the policy, this increases the amount the insurers will pay towards repairs by either 25, 50 or even 75%. It increases you premium but if you really want to be protected, its well worth considering.

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