You may be looking to sell your vehicle. You may instead simply be curious about its true market value. Either way, it's an in-depth subject; valuating classic, prestige and performance cars boils down to accurately assessing a number of key factors, such as provenance and originality.
We'll be walking you through this in this article. While there are common misconceptions around the subject of valuation, it's still a process that any owner can complete accurately when the need arises.
Market value: Don't be fooled
Mainstream insurers tend to provide their cover on a Market Value basis – the price your car would be expected to command on the open market in its present condition. While this is ideal for everyday vehicles, it poses a real risk to classic and performance car owners.
As Market Value cover is estimated on an average price, it does little to cater to the unique factors that affect your car's true value. As an example, a classic car that is fully original will be worth considerably more than a similar vehicle that has been modified or had features replaced with second hand or reconditioned parts.
It's a common misconception that, in the event of a total loss, market value cover will see the Market Value paid in full. While this type of cover provides replacement with a vehicle of the same make, model, specification, mileage and age – and in the same condition – it doesn't mean insurers will exceed the amount shown in such a policy schedule. As an example, the new Ferrari 488 Pista's list price is £300,000, but trades for between £400,000 to £450,000.
Our advice is to steer clear of any insurer who offers Market Value cover and to instead seek cover that is negotiated on an Agreed Value basis. In most cases, your Insurer will ask you to have your car valuated by an independent source; specialist restoration companies and dealers, Car Club officials and other third-party valuation experts are common examples.
Ultimately, Agreed Value gives peace of mind through the certainty that, if a total loss occurs, you'll be able to obtain a replacement vehicle with the sums payable under your policy.
Factors that affect your vehicle's true value
There are four main areas to consider when estimating your vehicle's value. While we cannot guarantee these points to provide you with an accurate final figure, they remain great places to start and are the most important points to clarify.
Provenance: The overall history of a vehicle holds value. Particularly important for classic cars, a unique or rare provenance can drastically alter a vehicle's perceived value amongst collectors. If your vehicle has an accurate provenance, this is in your favour where value estimation is concerned.
Condition: It goes without saying that a vehicle in good condition commands a higher value. The subject of originality, however, is also important here; if the car's condition is excellent but includes unoriginal parts, its overall value will be lowered to some extent.
Popularity: Collectors and enthusiasts are as subject to trends as any other! Certain vehicles, such as Ferrari 250 GTs and Jaguar E-Types, will always be in high demand – and they'll command a higher price as a result.
Awards and Concours wins: Concours d'Elegance has long been a favourite occasion for classic and prestige car owners. A vehicle that has won awards at such an event will, in most cases, be more valuable as a result.
In addition to addressing these factors, car owners can take advantage of the wealth of information available to them on the internet. By browsing online auctions and sales results, message boards and sales platforms such as dealership websites, you'll find the information you need to home in on a reasonable estimate of value.
Case in point: Lockton's Agreed Value cover
Specialist insurers can provide uniquely valuable wordings that provide unique cover. Our Agreed Value policies are an example of this.
Under a Lockton Agreed Value policy, additional wording is available for vehicles less than 15 years old and where the sum insured is less than £500,000, the insurer pays the cost of replacing the vehicle in your policy with one of the same make, model, specification, mileage and age, and in the same condition prior to the loss, up to 150% of the sum insured.
If, however, the cost of reinstating your vehicle exceeds the sum insured shown in your policy schedule, and your vehicle is over 15 years old, we may offer wording that provides an additional amount of up to 25% of the sum insured for your vehicle – or an additional £100,000, whichever is the lesser amount. This is, if required, aimed at reinstating your vehicle to the same condition prior to your incident.
This is a prime example of how a specialist Agreed Value cover can serve an owner better than a more generic Market Value policy. True peace of mind matters, and it's great to know that you as an owner are secured against fluctuating or inaccurate valuation.