Agreed value

Agreed value is a way of insuring a car in which you and the insurer agree on its value up front, usually based on an appraisal, photos or other documentation. If the car is a total loss, the insurer pays that agreed amount, less any deductible the policy has, instead of working out the car's value after the loss.

It is the standard approach for classic, collector and heavily customized cars, whose value does not follow ordinary used-car pricing and may rise over time. Specialty insurers and classic car programs, such as Progressive's classic car coverage written with Hagerty, commonly use it, often with conditions on how much the car is driven and how it is stored.

Compare it with actual cash value, the basis of a standard auto policy, where the insurer estimates market value minus depreciation after the loss. It also differs from "stated value," which sounds similar but generally lets the insurer pay the lesser of the stated amount or the actual cash value. Agreed value is rarely available on a daily driver. If your car is collectible or modified, ask which method the policy uses, and update the agreed amount as the car's value changes.