Valuation: Risk Management in the Collector Car Sector

A cardinal sin in the insurance world is risk exposure. And one of the biggest contributors? Undervalued assets. The collector car sector is no different. Here’s a quick look at why frequent value checks are more important than ever when serving clients in this high-opportunity automotive space.

Why collector car valuations matter

Improperly valued assets are a big driver of your client’s risk exposure. That’s no secret. And what’s true for homes, boats, and daily driver vehicles is also true for collector cars.

Maintaining and (hopefully) appreciating is just one factor that qualifies a vehicle for a collector policy in the first place. If rare and fun cars like Mustangs, Corvettes, and Wranglers don’t hold their worth over time, there would be no need for specialty insurance or Guaranteed Value™ coverage.

But here’s the thing: many values are rising today faster than agents (and owners) can keep up.

Consider these examples from the latest Hagerty Price Guide update, covering the first quarter of 2022:

• LS5 equipped 1970 Chevelle – up 42 percent
• Audi R8 V-10 – up 20 percent on average
• Datsun 240Z – up an average of 12 percent

You can’t throw a dead battery without hitting a collector car segment that hasn’t posted gains. In fact, nearly 97 percent of collector vehicle values have gone up in value over the past year. Many by double-digits.

Do your clients realize their car values are going up? And by how much? Maybe not, especially if you’re relying only on annual or semi-annual premium renewals to spark a value change.

The truth is, undervaluation can lead to both risk exposure and to big surprises during claims handling. And nothing sours a client relationship quite like a bad service experience.

Undervaluation can cost you and your client dearly. That’s why frequent valuation checks are so important.

In the long run, more valuation checks usually lead to more client renewal checks.

Find and share values using Hagerty Valuation Tools®

Consistent value checks will confirm you’re offering clients the absolute strongest coverage at the best available rate.

Not sure where to begin? Brokers writing with Hagerty have full access to more than 40,000 vehicle values as part of Hagerty Valuation Tools®*.

Our expert analytics team is busy dissecting multiple collector car data sources to track unmodified car, truck, and motorcycle values as far back as model year 1946. We’re confident in rating these vehicles because no stone is left unturned:

• Live auctions
• Peer-to-peer sales
• Industry partners
• Customer sales, and more.

We also know a vehicle’s valuation history can be just as important as what the vehicle is worth today. That’s why Hagerty provides all the information you might need to estimate a car’s value — including both model history and condition guidelines.

Eyeballing values both past and present will help you forecast what your client’s special cars may be worth down the road.

An up-to-date value eliminates costly appraisals and ultimately saves your clients money. But that’s not all. Coverage through Hagerty ensures your clients receive their full Guaranteed Value™** if a total loss occurs. That means when a vehicle is valued correctly, your clients will be on the road to replacing it in no time.

Encourage value checks to boost premiums

At the speed this economy moves, it makes sense to check collector vehicle values even more than you might think. If the worst were to happen, you’ll be glad you did. (And so will your client.)

And remember, you can always empower clients to check their vehicle values themselves whenever it’s convenient. The Hagerty insureds on your book will receive routine Hagerty Value Analysis notifications that share updates and encourage valuation checks. 

Once in the habit, clients will be knocking down your door to report higher values. That makes your job easier and brings in higher premiums. That’s a win-win in our book.

Find more information by visiting the Hagerty Broker Business Centre. Take a spin through our products and grab our latest information materials. You can also call us at 888-349-7834 or live chat at hagertybroker.ca to talk values and coverage. We’re here with dedicated support 7 days a week.