THINGS TO LOOK OUT WHEN INSURING MY CORVETTE PART 2

The other is a stated value policy, which is a true valued type of policy where both parties agree, in advance, as to the value of the property. In the event of a total loss, the company will pay the full face value of the policy. It turns out this is an Inland Marine type of policy generally used with works of art, boats and other marine equipment. There are a few companies, however, that do offer it as an automobile policy. This difference may be the reason for the wide misconceptions about stated value policies. Mr. Flippin asked eleven different Nationwide agents how the company would settle a stated value policy. None of them corrected him by saying they were actually *stated amount* polices, five of them said the company would pay the full stated amount and five of them did not know. Only one actually knew the company would not pay the stated amount in the event of a total loss. He said he chose not to sell that type of policy because the insured pays an additional premium and receives no additional protection. In fact, the insured receives less protection. The standard indemnity policy pays the ACV at the time of loss with no limit on the company's liability. The stated amount policy still pays the ACV at the time of the loss, but the company's liability is limited to the stated amount. For example: Assume a car has an ACV at the time of loss of $10,000. For an $8,000 stated amount policy, the company would only pay $8,000, where they would pay the full $10,000 under a standard indemnity policy. The insured pays an additional premium for the "privilege" of limiting the insurance company's liability.