Stated vs Agreed
When you have a high dollar item, or a uncommon item like a classic remodeled car, you will normally need a special policy like Agreed or Stated Value Policy.
These are ALMOST identical, but there is a slight difference.
An agreed value policy is the EXACT amount of money you will get for the item. Let’s say that you can a 1965 Chevy that has been completely restored, upgraded etc. You want to know that if you crashed, you would get $100,000 for it. If you buy an agreed value policy when the car is totaled, they will write a check for $100,000, regardless of the market price of you car.
However, the agreed value policy is expensive, so you check out a stated value, which pays UP To the amount of money on the policy. You select $100,000. You crash and the insurance company is going to check the market for you car and compare it. They find that a car just like yours is selling for $60,000, so they only pay you $60,000.
In short:
Agreed Value:
The insurance company pays EXACTLY the agreed value, an value that was a fair valuation, agreed by both the insured and the insurer. This policy benefits the insured. Key phrase here: FAIR VALUATION
Stated Value:
The MAX the insurance will pay for an item. This policy benefits the insurer. Key phrase: MAXIMUM
Recommended: Gold
The GOLD Course is ALWAYS the recommended class series for all students as it teaches the material in more depth. Over 30 hours of the most in depth classes with a more intensive teaching of the topic. Learn more about P&C GOLD
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