Thread: Insurance on cars

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I'm not in the insurance biz, but I worked with (against?) insurance for years. Those guys work on the odds of loss, and they're very good at calculation. The situation that Mike described above where the shop operators that had fire that was insufficient for the contents is a good example of a dumb/cheap shop operator, and maybe an incompetent agent/insurer. When I had my shop, part of calculating the amount of coverage (and of course the premium) was an estimate of the value of a "typical" days automobiles on the premises.

Your question got me to thinking about my home shop situation, and how I'm probably under insured. The rub is, catastrophe is a low probability, thus the premiums are comparatively low, but high chance of significant loss if the bad thing happens. I've got my major value car project insured with Hagerty, they'll insure a rod/antique in project stage. The rest of the toy cars are with Grundy, who told me they don't do projects. As for the shop stuff, like most folks, that should be covered under "normal" home owners. And there's the potential problem. If you've got the typical backyard builder equipment you're probably outside normal coverage limits. Not many "typical" garages have, say, an 80 gallon, high volume compressor, a MIG, TIG, and oxy/acetylene rigs, lathe, sheet metal shear, drill press, and on and on..............think of how much money is in that roll around tool box that you've accumulated over 30 or 40 years. It's probably like high value jewelry that has to be itemized because it isn't "typical" and put on a rider to the base policy to be covered. It occurs that any of us (meaning me as I'm thinking of this) should get a video camera and spend a day going through the shop and recording each significant item that is out of the ordinary, though having it all would be even better, and recording vocally the current replacement value (date stamp it for later adjustment). With electronic storage it's not too hard to keep a copy of the recording off site (wouldn't be worth much to have it burn up with the house), heck, even have a copy in the agent's computer.

Like said earlier, it all comes down to your tolerance for loss. If something bad happens insurance is cheap..........it's just that years of paying without a claim makes it seem costly. It's risk.............