The Difference Between Actual Cash Value, Agreed Value And Stated Value Auto Insurance 

Anytime an issue of car insurance indemnity comes up, the prospective beneficiary is most times concerned about what the payout would be. The question they keep asking is if the payout would be enough to negate whatever loss they have suffered. there are quite a number of methods for conducting car valuation. One such is the stated value auto insurance Maine. The right option to choose when buying a policy depends on your specific needs and preferences. So if you are considering the right valuation method to opt for, check out the options below. 

Basis for Valuing an Insured Car

Basically, insurance companies have three types of methods for valuing an insured car. These are:


  • Actual Cash Value (ACV)


This is the most common type of valuation method that is used and is found in almost all typical insurance policies. Just as the name implies, this valuation basis determines the worth of the car right before the accident. To do this, the insurance company sends a claim adjuster to go examine your vehicle. After doing that, he carries out his research on what a similar car would have been worth prior to the accident. It is whatever figure he arrives at that is offered to you.

If you feel the figure offered to you is too low, you can refuse it. They may likely review the figure and present you with an adjusted one. In the event that they do not adjust it, you can always hire a car accident lawyer to help you make a stand against the insurance company.


  • Agreed Value


For agreed value insurance, there is usually no need for long deliberations as long as the insurance contract was clear and precise. This type of insurance is more of an agreement between the insured and an insurer. It states that in the event that the insured’s car becomes a total loss, a certain amount they’ve both agreed upon will be paid to the insured. 

This type of insurance is usually taken out on classic, antique, vintage, restored, or modified cars amongst others. Owners of brand-new cars might also spring for this insurance option especially if they had to take out a loan to purchase the car and they haven’t fully paid it back yet.


  • Stated Value


Stated value auto insurance Maine is an agreement between the insured and the insurer for the insured to buy a policy that covers his car at a value that is lesser than its actual worth. 

What this means is that if the insured loses his car, the insurance agency would pay out the stated value, only if it is lower than the actual cash value of the car. 

These are the three basic valuation methods that insurance companies use. So, before you take out that insurance or you renegotiate your contract, you should think well about which valuation method is best for you.