Hello Everyone, I am writing an article on insurance companys' positions on repairing vintage and late model Corvettes. I am interested in hearing the opinions of NCRS members regarding what responsibility the insurance companies have towards repairs when Vintage Corvette gets damaged. Should the insurance company be responsible for bringing a Corvette back to pre-collision condition? Should they assume the cost for correct parts and procedures. Most car owners are satisfied with an OK repair. Should a Corvette owner be entitled to receive "factory appearing" repair. Any feedback is greatly appreciated and will assist me in writing my article. Thank you Jim Jordan
-
-
Re: Insurance Company Liability
Jim,
Good topic. As both a "car guy" and insurance company employee I have an interest in both sides of this coin, although I'll state that all of my comments are my own personal feelings and are not necessarily the feelings of insurers.
Most collector policies are on an "agreed value" basis, which means if you and the insurer agree that you car is worth, say, $40,000 and your car is stolen or "totalled" then you would receive the sum of $40,000. You bring up the grey area of repair if the car isn't "totalled". [This topic seems even more appropriate given the timing of the recent Consumer Reports article on insurance companies pushing the use of aftermarket parts for repairs, and FYI there are a few suits that were just filed against major auto insurers (Geico and State Farm I believe) on just this topic.]
I think the best way to handle this would be to discuss this issue with the agency that writes the policy on your car when you initiate the policy and NOT after you've had an accident. After such discussion (and assuming that the discussion results in you, the policyholder, happy with the outcome of the discussion) you should send the agency a letter in writing (preferably via certified mail - so you have proof you've sent it) summarizing you're discussion. NOTE!! The agency you deal with is NOT the insurer. These agencies just handle the business for a particular insurer (for example, Grundy agency handles classic auto for Chubb Insurance). If the agency doesn't feel that they can answer these questions you have, you might want them (or you) to get in touch with the insurers themselves. After all, who pays the claims?
Let me just mention a few issues regarding the pricing of policies (in general). The overall policy premium is meant to cover: 1) losses, 2) expenses, and 3) profit. I won't go into the expenses or profit pieces since they are sort of self-explanatory. The losses that an insurer expects can looked at as a combination of two issues: 1) severity (the $ amount of each loss) and 2) frequency (the # of losses). The way that these collector vehicle policies can be priced as "cheaply" as they are (compared to policies for regular cars at least) is that the expected frequency of loss is very, very small. The insurers know that these cars are driven very infrequently, and that the owners would probably give their left arm to prevent any damage/theft to their "babies".
The issue of low frequency becomes even more "beneficial" to insurers if you consider that the vehicles with the higher "agreed values" are probably trailer queens and are probably hardly ever driven. So the likelihood of a loss for the higher-valued cars is even lower than for the lower-valued "drivers".
I would think that this grey area of "what type of repair" becomes even more important to the owners who have "virgin" body cars or the more-valuable cars. I'll cut myself off now before I bore all the other NCRS members, but I hope all that read this call their respective agencies TODAY to discuss this issue. If you (the owners) think about it, if your car was damaged you would probably want it to be repaired with factory-style pieces and not glassed/bondo'd back together).
John Rohe My e-mail address is rohebo@yahoo.com if you would like to discuss this further. -
Re: Insurance Company Liability
Is it true that the car is covered only to and from shows and to get repairs?Comment
-
Re: Insurance Company Liability
Actually, the policy covers whatever you have it for. For example, my current company, American Collectors Insurance, covers my car for cruises, shows, parades, club events, and to and from maintenance. They also cover a max of 2500 miles per year and have a few other restrictions. This is all for about $170 for a 1966 convertible, with a stated value. I have been quoted figures of up to $600 for a daily driver, using this same car without those restrictions. If you are in the market for insurance, shop around, decide what you want covered, and then make certain that your policy covers what you need.Comment
-
Re: Insurance Company Liability
Thanks for your input Gary. What I am really looking for is opinions on what level of responsibility the insurance companies have in terms of making Vintage and Late model Corvettes "correct" when they are damaged. How do you feel?Comment
-
Re: Insurance Company Liability
Insurance company's standard liability is to put you back to where you were before the loss (no more/no less). On the other hand, the burden of proof as to where you were before the casualty is on you. That's why I have my driver judged frequently (once a year or so).
No, NCRS judging does not qualify as an appraisal/evaluation, but it is a qualified expert opinion of the relative level of factory originality and condition of your vehicle. A 'doomsday' file of judgings supporting a consistent level on your vehicle gives you support to argue your case for a given loss (doesn't mean insurance company is going to cave in and accept whatever you say)....Comment
-
Re: Insurance Company Liability
One factor in this discussion is the realtive value of the car before and after an accident. The concept of insurance is to get you back to where you were. If you have an undamaged, factory original car (perhaps documented via judging sheets), that is what you need to get back to after an accident. Any use of detectible non-original repair parts, or detectible repairs at all, for that matter, devalue the car.
The car should be worth exactly the same amount both before and after the accident. What ever repairs are necessary to get it to that point is what has to be done. Anything less, and having an accident has cost the owner money. Unfortunately, it seldom works out that way.
Two other points that occur to me. Since an undamaged car is worth more than a damaged, but properly repaired (undetectible) car, the insurance company should also compensate the owner for the decrease in value. I had this happen to me on a brand new Z/28. The insurance company paid me $1000 extra because my car was now worth less. But I had to ask, they did not volunteer it.
The other point is that original classic car parts are hard to find. I personally would accept a reproduction part only if it was exactly like the original. Otherwise, I would request NOS or undamaged used original parts. I know this makes repairs of classic cars difficult. If the insurance company can't or won't do this level of repair, I would expect to be compensated for the decrease in value because the car is no longer original.
Just my $0.02Comment
Comment