Telling your insurance company the true nature of your collector classic by employing an appraisal is a very good precaution for when things go wrong. The craziest things happen to cars. They go up in flames, they get damaged by floods.
I had a client who had a highly modified modern classic car. His insurance agent had not requested an appraisal and the car had no specific value on the policy. The owner of the car had spent $125,000 total on the vehicle. There was a midsummer storm which caused widespread flooding and, in his case, his garage was situated under the house and the car ended up in 2 feet of water. The insurance adjuster explained that the insurance company would make no effort to restore the vehicle because the wiring system and engine management computer had been underwater. The car itself appeared “as new”.
The insurance company appraiser came along and explained that you could spend a fortune on one of these cars and still not make it any more valuable than the base unit. My research indicated that there were cars in the U.S. that were restored and modified in a similar manner that were selling for twice the amount that the insurance company was offering.
The end result was that the insurance company paid the client the amount I had indicated and he kept the car salvage for free. He was able to sell the salvage to the vehicle’s restorers, which allowed him to recoup all the money that he had invested in the vehicle.
Another precautionary tale involved a gentleman who went to New Jersey to buy a brand new Japanese car that had been flooded on the dock after it had been unloaded from the shipping vessel. When he got it back home, he discovered that purchasing the computer modules was going to cost him more than the vehicle was worth, and because the car was so new, there were no used modules in any wrecking yards. He was paranoid because he had never explained the situation to his wife, yet.
The moral of this tale is that a simple car appraisal is a very powerful tool in case the unexpected happens. A small investment now can protect you from huge losses. Contact us for a professional appraisal you can count on.
LIPSTICK ON A PIG
Avoiding Life’s Lemons
Lipstick on a Pig features excerpts from the vast library of Maurice Bramhall’s experiences.