June 05th, 2017

INSURING YOUR COLLECTOR CADILLAC:

My personal experience and some tips…

Here’s a question I am asked a lot, especially by members new to Peach State Cadillac: “How should I insure my ‘new’ collector Cadillac?” There are three ways to learn this lesson:

• A. The HARD way: Your “new” Cadillac burns to the ground, then your auto insurance company’s settlement offer is outrageously low. You’ve heard that one before… haven’t you?
• B. The EASY way: You ask someone who knows, and you LISTEN.
• C. The SORT-OF-HARD way: At a cruise-in we were talking cars when a stranger asks Buster, “What kind of insurance do you have on your ’58?” Confidently, my buddy replies “Agreed value with American National.” Now, I’m thinking, ‘Bingo, agreed value!’ Stranger turns to me, asks the same question. “Agreed value, State Farm.” Our new friend: “Better check your policy. The language is not for AGREED VALUE…” And sure enough, when I did my homework, I discovered that my insurance on both collectible Cadillacs was NOT agreed value, but “stated value.” Sounded like agreed value to me. And with all those “deep discounts” I was getting by bundling my home, auto, homeowners and personal liability, I figured I was getting a great deal. Good thing I didn’t have to learn the HARD WAY (see A. above).

So, take a lesson from me… You want coverage that has these four features:

• It is Agreed Value coverage, not Stated Value coverage
• It is with a reputable company that knows collector cars
• It is with someone you can get to know and trust
• Its cost is favorable compared with other insurers’ products

Don’t do it the hard way! Here is a layman’s guide to those guidelines, based on my own search:

Agreed Value. If your classic Cadillac is totaled by your insurance company, will you receive a fair value for it? Be clear: it’s the policy language that matters, not the sexy ad copy or TV commercials. The policy will spell out what and how you get paid. In Agreed Value coverage you and the insurance company agree on the vehicle’s value when you sign up - before the policy is issued. Before money changes hands. If a disaster happens, the insurance company guarantees to pay the value that the two of you agreed upon. The physical damage section of your policy should read something like this: “In the event of theft or a total loss we will pay the Agreed Value.” Now, the lowest premiums will most likely match what an appraiser would certify as fair market value, but if you insist on a higher valuation you may be able to negotiate a higher agreed value. Once agreed, that’s the value you’re paying for.

“Stated Value” coverage is NOT Agreed Value. It is what’s usually written on daily drivers, and it can be trouble for collector car owners. Typically, Stated Value policies say this about a total loss: "In the event of theft or a total loss we will pay the Stated Value or the Actual Cash Value, whichever is less." That escape clause lets the insurance company declare the car’s value (based on its own sources of valuation, such as Kelley Blue Book). Stated Value exists so you can decide how much premium you’ll pay, not how much you will be paid. It allows you to insure a car as it depreciates, in exchange for a lower premium. That’s a good deal if your car is at risk daily. But collector car premiums are already low: You drive your car less often, you maintain it well, and you do not expose it to the dangers of other drivers as often. As a result it’s not depreciating like your daily driver.

If your policy is not specifically written for Agreed Value, go get another quote from a reliable collector car company. Do it now. Don’t wait until you have a problem, or get into a disagreement with your insurer. Don’t leave it for the lawyers to sort out!

A reputable company that knows collector cars. You know the big NAMED players in this game, right? Hagerty, J. C. Taylor, and Grundy advertise the most. But I am covered by ANPAC —  the largest insurer of collector cars in the business. American National Property and Casualty Company is the property and casualty division of the American National Family of Companies of Galveston, Texas. ANFC is 109 years old and a multi-line insurer with $160 billion under management. ANPAC’s collector car insurance package is called CHROME. You may have seen CHROME classic car insurance featured in ads in Hemmings and other magazines (with an app for your smartphone). They sponsor both the National and Georgia Street Rod Associations. CHROME stands for the vehicles it was designed to cover – Classic, Hot Rod, Original, Modified and Exotic. These policies feature agreed value coverage for annual mileage up to 10,000 miles (with an unlimited mileage option in many states). CHROME covers roadside assistance and towing. You will have your choice of repair facilities, and spare parts are covered. There are discounts for car collectors who insure multiple specialty vehicles, with endorsements for vehicles under construction. Good coverage… But with all insurers, be careful of the mileage you accumulate, and stay within the limits.

Someone you can get to know and trust. What you want is personalized service through a local agent you can count on being around when you’re at the cruise-ins. Someone you can trust. I gotta tell you, I cannot remember the last time I actually SAW my State Farm agent, and I can only speak to his employees on the phone. But my ANPAC agent has been to my house several times.

Cost is favorable compared with other insurers’ products. All I can say on this matter is to shop around. Give the insurers a call and let him offer you a quote. I know my CHROME premiums are a LOT lower than they were with the other auto insurance company, and we are talking about converting my daily drivers!