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Insurance Comments

Insurance

Regarding Insurance - I haven't read my policy lately, but my vernacular understanding of "Actual Cash Value" insurance is that the company will value your vehicle by purchase price and depreciation schedule, meaning that after 30 years they'll claim it has only scrap value. BUT, that you do have recourse, and if you are able to prove to them (through photos, appraisals, comparable-car sales, etc) that your car had a higher market value, then they will settle for a higher claim. This is (luckily!) only theory for me... haven't yet had to test it! Basically one's choice seems to be Stated (or Agreed) Value insurance, and pay the price, or Actual Cash Value, and gamble on being able to prove vehicle value. Can anyone shed further light on this question? Thanks. - Ed Mellinger, '59 XK150 FHC, '49 HRD 'B' Shadow

Ed, I don't know where you are located but here in the U.S. the "antique car policies" were created by Inland Marine underwriters. Without getting into the meaning of that apparent oxymoron ("Inland Marine??") suffice it to say that these folks are the U.S. versions of the cats at Lloyds who think up new and clever ways to insure wierd stuff. Long ago when our first car-nut ancestors began looking at "old junkers" as things of beauty (yippeee!!), the cars also started actually going UP in value as interest in the hobby increased. That freaked out the ordinary automobile underwriters, who weren't sure what to make of these kooks who were actually fixing up Aunt Tillie's old Duesenberg and going to car shows with it (ruining a perfectly good chicken coop in the process, no less). Add to that the concern of the antique car owners, because the ordinary auto policy valuation clause was drafted to address a DEPRECIATING property, not one which would appreciate. The whole insurance company goal was to make darned sure people didn't go around torching the old Rambler for the insurance money and the best way to make sure that didn't happen was to have a tough "actual cash value" clause. So if the car was junk, or all the neighbors knew it used to be a chicken coop, that's exactly what you got paid for. None of this "collectible" nonsense. The whole idea of "financial betterment" via this old car fad raised the spectre of moral hazard (gadzooks, these wierdo grease monkeys will be burning their old Duesenbergs coast to coast for the insurance money!!). Along come the Inland Marine underwriters to the rescue, who had been insuring museums, fine arts and other sundry collectibles all along. Being kooks themselves, they probably had a few of these geeky old cars of their own at that point. The Inland Marine underwriter looks more at the person than the property, meaning if their policies are going to be "more trusting" then their standards are going to be correspondingly tougher (there being certain limits to trust). So this antique car thing didn't phase them much. They basically took the valuation clause from their fine arts policies and transplanted that into an auto policy..... and voila, a whole new market, which is how we come to have the Taylors, Grundy's, and so on, who've been at this for a long time. The point I want to harp on, again, sorry, is that these policies all came from the pens (or PC's) of different human beings at different insurance companies. Real people, some are pretty good with contract language and others not so good. Some have your interest at heart, maybe others not as much. A few are basically bureaucrats who don't know squat about old cars and their project of the week back in '78 was to draft the product that would eventually be sold to YOU. The forms are NOT STANDARDIZED and are all companies are NOT ALL THE SAME. Thus while general industry terms like "agreed value" and "stated value" are good starting points, the actual clauses from company to company can be different. The perception problem behind some of the confusion on this insurance is that folks believe if these coverages are "regulated" by state insurance authorities, they must be all the same. Special interest auto ("antique auto") policies ARE regulated but only in the sense that each state requires the insurance company to file the contract language (and in most states, the rates) with the state. A state examiner looks at the coverage and eventually approves it for use in that state. The examiner does not review these to make sure they're all the same, does not review against a standard template, and in fact open competition has resulted in better and broader coverage, but NOT "the same" coverage from company to company. Examiners make sure the coverage conforms with state insurance regulations but generally if the contract is a legal contract there is no focus on or concern over whether you're getting a better deal or broader coverage with company A versus company B. Other policies to watch out for are any with "hybrid" language which might be titled "Stated Amount Valuation" but which, in the body of the clause (or worse, elsewhere in the policy) start talking about deduction for depreciation or "we will pay the least of" and then list several things, two of which might sound great then the third might revert to a quasi-actual cash value basis. Policies that throw around "market value" aren't much better that ACV policies because they can end up paying you less than the policy limit if "the market" falls (yeah, but WHICH market and according to who?? technically "market value" means something like "willing seller dealing with willing buyer in the open market without duress" but that differs too and besides, who the heck knows what that means? some klunker auctioned off in East Wazoo a year ago?). Also, if you owe da bank on da car, imagine where you'll be if "the market" falls below what you owe on the car, and then something happens to the car? Sorry to drag that thread out but it is definitely worth having an agent who will TALK TO YOU AND EXPLAIN THE POLICY. Take notes on the discussion, date them, check the notes against the policy when it arrives to be sure you got what you were promised, and keep the notes with your policy. The agent should help you if you have a question on a policy placed through them and if they don't, DO NOT HESITATE to contact your state insurance commissioner's office. Hope this helps a little, although it kind of says "you have to do your own homework by shopping and asking questions." Most policies, companies and agents are just fine but if you want to be SURE you'll need to do the extra due diligence. - Dick Rowley, '54 XK 120 FHC, '62 Mk II 3.8

I had a favorable experience with USAA a couple of years ago involving a rear end collision of my '66 Volvo 1800S. I was able to provide receipts for mechanical and upholstery work which had been done and they sent out an adjuster to inspect the general condition of the car. They paid a claim that was in excess of what many of these cars are listed for in SEES (Volvo Sports America's publication). I don't trust this approach enough for my '53 XK120 FHC though and that is insured through Haggerty. I have no claims experience with them. - Carl Orlob, XK120 FHC

Having nearly completed the restoration on my XK150 which I want to use as a daily driver, the issue comes up of where to go for insurance. My current insurance company is not too enthusiastic about insuring this vehicle (ie, they want a lot of money). Anyone have experience with someone who will quote a good rate on an XK that's going to be driven a lot? Thanks. - XK150@aol.com

This issue has been visited several times before and can probably be found in the archives. For my money, try Hagerty (800) 922- 4050 or JC Taylor, Inc, 320 South 69th St, Upper Darby, PA 19082 (sorry, can't find the phone #). Hagerty is now less restrictive than Taylor about mileage, etc. All this assumes you live in the US. If you're in Britiain or Yurup, the classic car magazines are full of insurance cos. - Gardner Howard, 53 120 DHC, 52 120 OTS

I have insurance with Taylor. When I talked to them about my driving (which doesn't exactly conform to their expectations), they indicated that they were more concerned with where I park it than how much I drive it. It seems that most of their claims are related to parking lot damage and, as long as I am careful to park it where it will not be vulnerable, such as in an unoccupied corner of the lot or in some special private place, they will not be too strict about their mileage limits. I've found that, with a car like the 120 OTS, many places I go are happy to essentially put the car on display in a protected spot because it is an attraction for their business. We drove it to a Scottich festival recently where the organizer reserved a stall for it in their vendor area at no charge rather than have us put it in the parking lot. It turned out to be one fo the most popular exhibits there. We enjoy turning many of our routine trips into one car shows. We live in Vermont where the driving season is only about 6 or 7 months long (the car is on a salt-free diet) and we do about 6,000 miles per year. I washed and vacuumed the car last Thursday in preparation for the British Invasion at Stowe. When we were going out Thursday evening, I told my wife I didn't want to take the Jag because it was so clean. (We live on a dirt road so it gets dirty every time it is driven.) Then I laughed and told her I was certainly never going to restore it because I'm reluctant to drive it when it's only clean. I can just imagine what it would be like it if was a "show car". I don't know whether other insurers are as understanding as Taylor but we are certainly happy with them. -- Bruce Cunningham '53 OTS

My experience with Taylor is that they pay a claim promptly and courteously. I had a garden tool fall and dent the left front wing. Claim paid no problem. Sorry to switch to Hagerty but they are local to Traverse City, MI and they did change their policy to not restrict mileage (a major point with me since I drive my car! ((Imagine that!)) ). Knowing the Hagerty people personally, I'm sure they will act the same. Good luck. - Gardner Howard, 53 120 DHC, 52 120 OTS

from an earlier thread on this subject...At the meeting of our British Car Club last week we had a presentation from Bill Parish of Parish MotorSports,an insurance company in Nashville, TN that specializes in insuring our kinds of cars. He's one of us, owns several Jags, drives the wheels off them, raced them and UNDERSTANDS us. His company is flexible, and will work to see that the driver gets what he needs to protect his investment. As our guys were talking to him, several times he told them that in individual cases, they would do better with regular insurance, etc. (Usual disclaimers apply .) His phone number is 1-800-274-1804.

My 140 is a daily driver. I had to call several places to find the appropriate agreed value coverage (which is what you are looking for, BTW) but I finally called one of the larger independent agents in my town. The policy is through Chubb Insurance. I never got hold of Bill Parish. - Jim Voorhies

Have had experience with both Taylor and Parish. Taylor from 1976 into '90s but never had a claim to "test" them. But their reputation is excellent. The problem with them arose one year when they "forgot" to send me any renewal advices (nothing!). I didn't notice, but didn't drive the cars that year so luckily it never made a difference. When I went back to them to ask what happened, after going for a year with no coverage, they told me I could "renew" for the coming year only if I would pay for the PRIOR year too, for which they had failed to notify me of the policy expiration! After all those years without a claim, I said "Ferget it!" and moved the coverage elsewhere. Taylor was correct in advising me that IF I had had a claim during the year there was "no coverage" due to their oversight, they would have had to pay because they had not complied with state non-renewal regulations. But that didn't make me feel much better about their wanting 1 year premium retroactively, and 1 year going forward, at the same time. I figured the least they could do was write off the year where they forgot, and for which I didn't need the coverage anyway. Not so in their world, I guess! Parish had my coverage with CIGNA. The attraction there was Bill Parish, who is indeed knowledgeable and who took all the time I needed over the phone to explain the coverage and shoot the breeze about cars, racing, etc. The CIGNA program, I'm pretty sure, had no mileage limitation or at least had an "unlimited" option. For valuation (which is the main policy clause influencing settlement of any claim you make), companies can use different terms to mean similar things. You do NOT want "actual cash value" or anything that refers to "deduction for depreciation." You DO want a policy that refers to "agreed value" or "stated value." All policies are NOT the same so ask any prospective agent to send or fax a sample contract to you, and READ the valuation clause. I will say that Parish is not the cheapest, but I felt like I had someone who would be on my side if I had a claim, and that says a lot. Incidentally, probably the best way to do some homework on this is via the Internet. Quite a few agents have sites you can visit. - Dick Rowley

If you have any questions or comments send e-mail to: ted@jag-lovers.org
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