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Agreed Value Insurance guide

Agreed Value Insurance guide

After buying a prestigious vintage car, and spending every spare hour in the evenings and at weekends restoring it to it’s former glory; the next step is to make sure you are adequately insured to recover the full amount you have spent on the car should you have to make a claim. This is where an ‘agreed value’ insurance policy comes in.

What is agreed value insurance?

Agreed value insurance means in the event of a total loss (stolen or write off) of your vehicle, you will be reimbursed with an agreed amount based on the valuation of the car given when you take out the policy. Standard insurance policies will only give you the current market value; however the value of classic cars tends to fluctuate due to the desirability of the vehicle, so you can protect yourself from a massive financial loss by taking out an agreed value policy.

When you take out your cover, you may need to pay an additional fee to obtain the agreed value, however this is a small price to pay to ensure you receive the maximum amount possible should you have to make a claim, minus the agreed policy excess.

What do I need for agreed value insurance?

In order to take out the agreed value policy, the insurance provider may ask for the following before agreeing a fee with you:
  • Photos of the vehicle including: all sides of the car, front and back ¾, the front and back of the car, the engine bay, the car registration plate, the dashboard showing the current mileage, and the interior of the car.
  • All available service records/history
  • Model specification & year of production
  • Body colour and originality
  • Condition of the interior
  • Details of all body damage
  • Any major mechanical replacements
Some insurers may also ask for an independent valuation from a specialist car valuer.

If you can provide as much information as possible, it will help you protect your cherished vehicle in the event of a collision.

Check your policy

When you take out your policy, you may want to ask about the following details about your cover:
  • Ask if you can increase the agreed value each year to correspond with the value of your vehicle
  • Check if you are covered when attending competitions, events, rallies or meets ups with other enthusiasts.
  • Consider a limited mileage policy - driving less miles can often result in a lower premium as you are deemed less of a risk to the insurer.

How to get an agreed value policy?

Shop around - comparing different providers using sites such as moneysupermarket can often mean big savings on your insurance.

Most insurers offer classic car insurance, and you may be able to get further discount if you are a member of a recognised car club. When taking out a classic car insurance policy, be sure to ask if there is an agreed value option.

Tips to save on your insurance

There are many ways in which you can save on your car insurance policy; below are just a few examples:
  • Pay for your premium in one go - paying for your policy in a lump sum rather than monthly payments can reduce the cost of your insurance by around £100-150, so try and pay for the year in one go if you can afford to.
  • Offer to pay more voluntary excess - this makes a difference to cost of your insurance, if you think about adding an extra £100 or £200; you could see savings in the long term.
  • Secure your vehicle - any security device & where you park your car have an impact on the cost of your insurance; many classic cars may not have an alarm, so getting one fitted will certainly help.
  • Consider changing insurers - the best prices are often given to new customers. Research from Moneysupermarket.com has shown that customers who stay with the same insurance provider don’t always save money. In recent years, insurance policies have increased due to the number of compensation claims that providers have been paying out.

    Agreed value insurance is definitely the way to go when you are looking to protect your prized asset; just remember not to undervalue your vehicle – you are paying extra for the privilege. Images: Martin Pettitt (http://www.flickr.com/photos/mdpettitt/) - Anthony Haslam
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