o Why do I see some appraisers have licenses and others do not?
At this time, we are unaware of any state that requires a license to perform any type of value appraisal. Some appraisers that publish that they are licensed are actually Physical Damage Claims Adjusters serving the insurance industry. Claims adjusters do have to be licensed. The key point for you to know is that having a license for claims, does not indicate any expertise or experience in valuation appraisals of antique and collector vehicles. They are more familiar with late model cars and the cost to repair them. We only do valuation appraisals and are active in the hobby. We have some of the same type of cars you do, are active locally in car show and cruise-ins, are members of national organizations and car clubs, and are National Judges for the Antique Car Club of America.
o What are the questions I should ask when choosing an appraiser?
Anyone can “claim” to be an appraiser. There are certain qualifications you should look for. These include but are not limited to:
1. What is the appraiser's experience in doing appraisals?
2. Is the appraiser active in the hobby?
3. Is there no possibility that a conflict of interest could be claimed by the insurance company?
4. What major shows and meets does the appraiser judge?
5. Will the appraiser stand behind the appraisal if it is challenged by the insurance company or in court?
6. Look at a sample appraisal. How detailed is it and the pictures taken? Does it not look professional?
7. Is the appraiser totally independent? (Not work or do work for insurance companies)
8. Is he or she a member of a national appraisers organization with additional resources available?
9. Does the appraiser personally assign the value?
10. Is the appraiser familiar with your particular vehicle and if not, where would he/she get the data needed to do a proper valuation?
If you answer “no” to any of the above, look around for another appraiser.
o How often should my car be appraised?
The insurance industry suggests you have your vehicle appraised every 2 years or 10,000 miles, whichever comes first. You should also have your car re-appraised if you have added value to it in any manner. The collector car market is in a constant state of flux and often a certain type or model has more demand than supply or simply becomes “hot”. Keep your eye on the market values and if you see several similar cars jumping in value, it is time to get your car re-appraised.
o My car is under restoration (or in storage), do I need insurance?
YES!! Your homeowners policy DOES NOT cover your vehicle. For a minimal amount you can purchase comprehensive coverage for your vehicle from any firm that insures collector cars. You should have at least enough coverage to protect your investment AND update the value often as the value of the vehicle increases due to work that has been done to it. Several classic car owners lost very valuable cars in the California fires, Hurricane Katrina, and local fires.
o What happens if my car is underinsured and I am in an accident?
This can be a major problem. Recently a 1966 Corvette was in an accident and had $25,000 of agreed value insurance... way below the real value. The estimate to repair the car was $27,000. The actual fair market value was $35,000. The owner received $20,000 and the car was totalled. He would have received almost $30,000 if he had a current appraisal on file. He lost over $10,000!
Sometimes we can appraise a vehicle after an accident to determine the value before the incident. This can be very difficult depending on the damage. It is impossible to comment on important value points such as fit of the panels after it has been damaged. Doing a Pre-Accident Appraisal is the last resort to avoid an insurance company determining your car is a total loss. The value they will use is 80% of the agreed or stated value. If the damage is more than a certain percentage of the value, they will declare it a total loss and it will not be fixed.
o What do I do if my insurance company challenges the value when I file a claim?
A Certified Appraisal is your best defense. If the value can be challenged, some firms will do so. This is especially true of situations where the owner has set the value or had had an appraisal done by someone who could be considered having a conflict of interest. The value should be set by someone who will stand behind it in court if necessary and maintain the information that was used to set the value. It is very rare that a professional appraisal is challenged but it does happen if they see an opening. A Certified Appraisal is rarely challenged and if so is even more rare to go to litigation.