I spend a good amount of time in court as an expert witness in classic car matters and I’m hoping to pass along to you some of the things that I’ve observed and learned.
Most of us who own classic cars have classic car insurance policies, and most of these policies are of the “agreed value” or “stated value” type. With this type of policy, if you should suffer a total loss, this value is what you will get paid. No questions asked, usually.
I was recently involved in a case in which the wealthy owner/driver of a show quality 1967 big-block Corvette was hit by another party and the Corvette was declared a total loss. The other party was found to be 100% at fault. The owner of the Corvette carried classic car insurance, but only in the amount of $25,000, the amount his insurance company immediately paid him. And that was the end of the story. Or was it?
As the accident was not his fault, he sued the other driver for $50,000, the difference between the appraised value of the car ($75,000) and the payment of $25,000 he received from his insurance company.
As is the law in most states, the other party’s insurance company is required to provide a defense in a case like this. They didn’t care if the car was a Corvette or a Chevette. They were not about to pay out $50,000 for some 1967 Chevy. And if enough money’s involved they will fight it with every tool at their disposal. This includes obtaining records from his motor vehicle department and tax authority which showed what he declared as a purchase price when he bought the car.
In an attempt to minimize his tax bill, the wealthy Corvette owner had declared a purchase price of only $2500.
I watched him squirm in the witness box and try to explain under oath how he had paid $2500.00 for a 1967 Corvette that was appraised at $75,000.00. This was right after the attorney had him disclose to the jury that he was the CEO of a company with over 1000 employees. Hard as this may be to believe, the judge and jury probably questioned his credibility.
In the end he was awarded only $10,000. My guess is that the jury was sending him a message that because the accident was not his fault, he was entitled to some money. At the same time they wanted to impress upon him that he can’t take advantage of “the system” and then use it to protect him.