A Guide To Enthusiast And Collector Vehicle Valuation

In this blog post we’ll dive into the vehicle valuation. Since we’re an insurance agency, we will talk about it through the lens of insurance. Still, valuation isn’t JUST for insurance. It can also help you understand the current real world market value for your vehicle based on what other cars like yours are selling for.

Of course, like all of our blog and media posts, this information is intended not to be direct insurance advice, but rather to help you learn and ask questions. Before making any decisions or using this information, we recommend consulting a licensed insurance agent in your state. Preferably, one who knows about enthusiast or collector vehicles.

Why Valuation Matters

Valuation and insurance loss settlement amounts matter to car enthusiasts. Sadly, for many of us, we don’t really think about them or think they matter until there is a claim. Then, all of the sudden, it can become one of the most important things. Why? Three significant reasons:

1) In the event of a total loss, like a significant accident or unrecovered theft, it’s the amount the insurance company will pay

2) It’s the basis for determining whether the car is totaled in any loss scenario, usually a percentage that is determined by the insurance company.

3) its used to determine the diminished value, if applicable.

Image courtesy of Facebook/Evolution Atlanta

Low vehicle valuations can be problematic for everyone, but especially for car enthusiasts. If, for example, your insurance valuation is below what it would actually cost to replace the car, you will be on the hook for any remaining cash you need to replace what you had. This is why we talk so much about “true replacement value”. With enthusiast cars, we know book value isn’t always an accurate representation of what it would cost to acquire some of these cars (Miata’s for example). It could also mean that a vehicle you love is totaled more easily, which is less than ideal if you prefer to have it repaired.

This becomes particularly important and more likely to be an issue in several scenarios that car enthusiasts are most likely to encounter. 1) The car is unique and hard to value, 2) the car is appreciating in value, which most mainstream carriers will admit they rarely take into account and generally assume all vehicles depreciate in value, 3) the car is restored or has been modified where the typical valuation of the vehicle doesn’t take into account the true replacement cost, 4) the car is imported, unique model or special edition or in some other way does not have a typical valuation available and finally 5) the traditional valuation companies are far enough behind on the changing valuation trends, particularly with modern classics, where the valuation and replacement cost is quickly changing.

Here is a spoiler: it’s a lot easier to address this and get the valuation of your vehicle right when buying insurance than it would be after a wreck or loss occurs. But first, let’s talk about where the value of your policy is likely to come from, some of the valuation databases, and what other options are available to determine valuation.

Where Insurance Companies Get Valuation

The vast majority of mainstream insurance companies do not have their own valuations or appraisals. In fact, about 80% of the largest insurance companies use a service called CCC Valuations. CCC is a company that uses technology to track the resale values of cars and has established a data of valuations.

CCC Valuations are generally the basis for Actual Cash Value insurance policies, and generally is also referenced in many stated value policies. If you are not familiar with these terms, you can learn more about the difference between actual cash value, stated value, agreed value and other policies types in another recent blog post we did.

If you’ve ever had a valuation dispute with an insurance company, chances are they sent you a “valuation” report, sometimes called a CCC One report. This report is an example of the information CCC collects and provides to insurance companies. For insurance companies, CCC is ideal because it’s based on real data. They can simply license it from CCC, so they don’t need to collect it themselves, and because it is documented and comes from a third party, they avoid appearing biased if there is a further dispute about how they determined the value.

Still, despite this arms length relationship, CCC valuations may not be sufficient in the scenarios we outlined above. You often can request the valuation for your vehicle from your insurance company, or in the case you are dealing with someone else’s insurance company, from them.

Components Of Enthusiast And Collector Valuation

First, our attempt here isn’t to replace a professional appraisal or valuation assessment. However, when it comes to valuation, there are a few major components that “move the needle” and can help you establish a realistic value of your vehicle, if only to get you in the ballpark.

Also, it’s important to note that valuation is rarely static. You don’t set it once and then forget it. As the market moves up and down, both at a macro level and for specific versions of your exact car, the value of your vehicle may change. If it goes down and you are over insured, you may be paying extra for your insurance. If you goes up, you may be underinsured. There can be other impacts on value, such as restoration or modification, that may impact the value of your vehicle even if the market has not changed.

The Year, Make & Model

Obviously, but it matters. And specific years or groups of year may be more valuable than others, often due to a model change that could make certain years of the same generation of vehicle more desirable than others.

The Trim And Major Options

Of course, Trim – along with other major options such as larger engines can have a huge impact on value, particularly if the trim is a limited or special edition. Still, be careful not to over value up market trims or mass produced options.

Also, when it comes to options, engine, followed by transmission and then drivetrain, will often move the needle more than other options, such as sport options, appearance packages, or convenience. In some cases, those won’t move the needle at all.

Condition

Condition, particularly when it comes to enthusiast or collectors cars has a huge impact on the desirability. While condition is somewhat rolled up in a number of these topics below – from mileage to maintenance history, the reality is condition – and grading of condition – is a topic all it’s own.

Condition isn’t specific to cars either. Coins, baseball cards and art are also examples of collectibles that place an emphasis on grade or condition. And the more collectible the vehicle, the more condition matters.

While professional appraisers and graders can have numerous, even dozens of grade levels, the vast majority of collectors’ tools recognize 4-5 major levels and then allow collectors to often consider partial or half levels. Names are not universal, but they generally are:

Fair – used across traditional used car and collectors to represent a usable but highly noticeably flawed vehicle.

Good – used across traditional used car and collectors to represent a vehicle that has a flaws, but are either minor or harder to notice.

Excellent – more of a collector term, represents a vehicle where from a slightly distance you would not immediately notice any flaws

Concourse/Fine – almost exclusively a term used in collectors’ circles, these vehicles would represent a near-perfect vehicle. No obvious flaws, even up close – or require exceptional detail to find. Also, it will generally imply period correct, if not factory accurate.

Note: Grade/Condition descriptions will vary and are not official. They are just to give you an idea. Also, not all collector databases (discussed below) necessarily note condition or grade. It may require you to assess the comparable listings to determine whether they’re grade helps set a valuation standard for you to use.

Mileage

Of course, mileage would be expected to make an impact. However, when it comes to collectible and enthusiast vehicles, these should be needle moving differences. The difference between 110,000 miles and 120,000 miles is generally not significant (unless it hits a maintenance milestone). However, the difference between 10,000 and 50,000, and those at 150,000, particularly on a rare, exotic, or old vehicle, can be substantial.

It also means when determining your own value, you should compare it to vehicles in the mileage bracket your vehicle is in.

The Body Type

Often easily overlooked because of personal preference, the body type, i.e. 4 doors, 2 door, convertible, etc, can have a big impact on the value. Comparing across body types could lead to significant discrepancies. The reality is that convertibles rarely carry the same value as the coupe versions of the same vehicle. Though which one is higher or lower can depend on the vehicle.

With some high value vehicles the difference can be 10s of thousands of dollars.

Modifications

Modifications can have both a positive and negative impact on value. For enthusiast vehicles, the value of the modifications can absolutely increase the value. The investment in improving the vehicle can have a direct connection to its resale value. Racing vehicles in particular see a direct correlation in value to modifications, even if it’s not necessarily 1 to 1. Same can be said for restomod projects.

However, modifications in some scenarios can also have a negative impact on value. Many traditional collectors look for factory perfect examples. Vehicles that have been changed from the factory reduce that. Also, modified high-performance vehicles can be seen as driven hard or abused, particularly if the maintenance and ownership history (mentioned below) isn’t included.

While enthusiast and collectors can have different views, there becomes some cases where so many vehicles were modified that finding unmodified vehicles to own or personalize becomes a challenge. We’re seeing this with Mitsubishi EVOs where near stock examples are out valuing significantly modified versions.

Unless you are familiar with the specific market, we recommend not assuming a modified vehicle raises or lowers the value unless you are sure. When comparing values to determine your own, we recommend comparing similar levels of modification.

Other Factors To Consider

There can be other factors that have an influence on value. They can be harder to prove and may have less of an impact depending on the vehicle. Still, for particularly perfect examples of highly sought after vehicles, they can set a vehicle apart.

Maintenance Records

Keeping maintenance records can help with any car’s value. However, the amount it matters will depend on the car. Highly collectible vehicles and exotics, particularly vehicles like Ferraris, can see a huge drop in value when there are no maintenance records or gaps in record keeping. And where the vehicle was serviced may also matter.

However, the more typical the vehicle, the less the impact. With that said, in nearly any case, a vehicle that can show documentation that it is well maintained and cared for will almost always out value something that has no history.

Regionality

What is regionality? It’s a fancy way of saving it’s not a rust bucket. Ever heard the term “southern car”? Alright, maybe it’s not that simple. Still, vehicles in climates without salt or sun damage can be considered more valuable. While, for newer vehicles, this benefit is often negated by limited driving in winter conditions and garaging, for certain classics and antiques, a regional car can help increase the value. Likewise, those with wear and rust may hurt the overall value.

However, we do want to caution. While some hardcore collectors looking to squeeze every dollar of value out of a vehicle will talk about regionality, its impact may be limited. As noted, a newer vehicle that is used little and garage kept from the elements with limited use during snow and other inclement weather events is less likely to be impacted by claims of regionality.

Valuation Tools And Databases

Hagerty Valuation

Hagerty has probably done the best job of creating a publicly available enthusiast value database, and least from the sense being straightforward and focused on vehicle valuations as opposed to other purposes.

While primarily focused on attracting leads and serving as a tool for their insurance needs, it’s certainly a great tool. Several mainstream companies utilize Hagerty’s tool when offering enthusiast or collector coverages. Hagerty’s tool has its limitations, though, as it is only effective with more popular enthusiast and collector cars. It also tends to favor classics and traditional collectors vehicles over newer exotics and enthusiast vehicles.

Also worth noting that while limited information is available for free, in order to get access to all of the details and a full export report, you’ll need to have a Hagerty Drivers Club membership. You can also ask your Hagerty agent to provide you with a report if it’s relevant to the business you are actively doing with them.

Classic.com Valuation

The site classic.com, a popular resales site for classic and exotic cars, and features extensive sales data history. Many of Hagerty’s competitors will use classic.com as a solid source for valuation, if nothing else, because it doesn’t give brand recognition to their competitor.

Classic.com valuation tools are worthwhile for more than the fact that they are not Hagerty. For one, their sales data and filter is extremely powerful for narrowing in on valuation. Major components of valuation, such as specific years, body types (coupe vs. convertible, for example), and mileage, can be used as filters. All of these are important distinctions when determining and requesting value, particularly for agreed value insurance.

While the tool itself is free, you will need to do a little leg work yourself in order to determine comparable and market value. Still, the data is useful and you get access to a lot more specifics about the vehicles used to make up the value than you will with Hagerty’s tool.

We find classic.com the easiest platform to find comparable values based on body type and modification level as well, something other tools because of the lack of detail behind their figures may not allow unless they specifically segment on it.

Secondary Valuation Sources

Below are some additional and more mainstream valuation sources. While well known, many enthusiasts and collectors’ insurers will not accept their values.

Still, they are useful. For one, for not particularly rare or special vehicles their values can give you a good ballpark idea of what the CCC value your insurance company is likely to offer on a actual cash value policy. So in our experience, don’t expect a massively different valuation between NADA, KBB and CCC, though they can be worth looking into.

Kelly Blue Book

Interesting enough, the most famous valuation tool is likely Kelly Blue Book (KBB). While a number of years ago this was actually a blue book that car dealerships and insurance companies used, most of this information is now online. While KBB is more popular in the dealership business, they are owned by Cox and licenses its data to a number of different companies.

NADA (National Automobile Dealers Association)

Another popular database of values is from NADA. NADA stands for the National Automobile Dealers Association. NADA has been cataloging used car values for decades. Their primary goal with their valuation is to provide information to dealers about the value of used cars – what they should expect to pay for trader ins and what they can hope to get at retail.

While NADA database is not specifically insurance related, it can provide a third party source of potential value.

Getting An Appraisal

While not needed for the vast majority of enthusiast or collector agreed value insurance, there are a number of cases where an appraisal may make sense. One may be if you didn’t have an agreed value policy and you have to fight for the value of a collectible, restored or modified vehicle. Another may be that the vehicle is simply too unique or rare to use a national comparative tool to determine a fair value.

In the event you need an enthusiast or collector car appraisal, there are a number of industry associations with auto appraisers to help you find one. Independent auto appraisers, just like those for your home, take into account your unique vehicle and situation to find comparable sales and appraisals that help determine an accurate value.

Appraisals can be useful if you need additional documentation on the value of your vehicle or if you don’t have an agreed value policy and must establish value after the fact. Still, it is important to note that just because you receive an appraisal that differs from the CCC or other valuation your insurance company used, it doesn’t necessarily mean you’ll receive that amount.

Finding An Appraiser

If you are looking for an appraisal for your collector, high value, rare, unique or specialty car, below are a list of directories and resources you can use to find a certified appraiser. Traction recommends you only work with a certified appraiser who is familiar with appraisals for your type of vehicle in your specific situation of need.

About Traction

Traction is an insurance agency that helps car people navigate coverage for race, track, show, lowriders and other modified or unique cars. By being car enthusiasts themselves, they understand that car people need different solutions that are not always available to, or within the capabilities of, traditional agents. Traction makes finding coverage easy allowing you to feel confident and get back to having fun with your cars.

Traction provides a full suite of insurance products aimed at serious enthusiasts. The agency offers enthusiast and collector insurance, coverage for exotics, unusual or hard to place kit cars or replicas vehicles; storage and trailered only policies for show and race cars; on track insurance by the day, event or year; motorsports insurance; excess liability policies on and off track and so much more.

Traction is available to any kind of car enthusiast but focuses on those who have deep rooted passions in their cars or automotive hobbies. Traction is available in a growing number of states. The products and services are provided through key underwriting and managing general agent partners.

Informational Purposes Only

As with all of our blog posts with tips and suggestions about insurance, these are intended as general information. The specifics of your policy, state and carrier may differ. The information in this blog post is not intended to be formal insurance advice. However, if you’d like to talk to a licensed agent about your specific needs or questions, get a quote. Always read you policy carefully.