Hull Insurance Value

[MoonlightVFR]

What Hull value insurance do you request on a Cessna170 A? Later Cessna 170B?

Do you think that the value of a New replacement Cessna 172 S should have any influence on the hull value of your beloved old Cessna 170?


Can an insurer legally refuse higher hull coverage than an owner has been purchasing in recent years?.

Regards

[bagarre]

I called Avemco a few months ago about upping my hull value due to some improvements Ive done and will be doing.
They were OK with the declared hull value as long as I was OK with the monthly payment

They did say that at some point, they'd want an official appraisal or something.

[170C]

An insurer can legally refuse to insure an aircraft (or any other item) for an amount beyond what they are agreeable to do so. If I wanted to insure my aircraft for a higher amount than they felt was appropriate there is the possibility I could be over insuring it and have a loss in order to recover more than the aircraft was actually worth. (fraud)

[sfarringer]

I fail to see why the value of a 172 S would have any bearing on the value of a 170.

I tend to think that the hull insurance should not be higher than the actual value of the aircraft that you are insuring. Of course, actual value is not easy to define on a 65 year old airplane.

I have mine insured for about $40K.

[c170b53]

Mine is insured for 65k. In some ways it's special, really it's not but the parts do add up. A broker was willing to sign a check for that amount and they know the market. I've been stating that value and paying the premium for some time. I hope I never collect (almost as I wasn't parked that far away from Miles at the convention) but I think the insurance firm would have a tough time talking down the value if they have been collecting the premium for years.

[MoonlightVFR]

I am trying to develop some practical information about the perceived Hull value of Cessna 170 A/C. Could not find in depth discussion of subject.

Now we have a few pilots who stepped forward. One a 40,000 insured hull value another 65,000.

How does the value of a new Cessna 172S enter into the thought pattern? Talking to bankers and Industrial insurance agencies. I keep hearing "insure your used factory equipment SAME as new replacement cost ". You know they would never pay a claim on used with new!

I do think that the price of "NEW" has some effect on increasing value of used classic airplanes.

Cessna 172S N55225 has list price MSRP $423,150.00 discounted for you to for only $395,000.00 I think this is an aberration but don' t you think an insurance agency will use new cost to at least slightly affect insurance rates on old stuff.

[gfeher]

Assuming you have a total loss, I think the insurance company will pay (up to the hull value limit) their calculation of the value of your plane at the time of loss, irrespective of the cost of a new 172 or any other new plane. I think they will look at other 170s of the same model, age and condition, with comparable upgrades and equipment,at the time of loss. I just bought a 52 170B, so I just went through this analysis. The "hull value" for your insurance policy is not really a value. It's a limit. Assuming a total loss, the insurance company will calculate the value at the time of loss irrespective of your hull value limit, and then pay their calculated number (subject to your argument with them) up to that limit. That's my understanding of how it works from others who know more about this than me.

My 52 170b is insured for a hull value of $40,000 as well. You can try to have a higher hull value limit (and pay a correspondingly higher premium), but that does not mean the insurance company will ever pay you that amount even if you have a total loss. So paying for a higher hull value can be just a waste of money on a higher premium that will never benefit you.

[170C]

In my opinion, the cost of a new C-172 (or other new aircraft) has nothing to do with the value of a C-170 or my '56 172. Just as a new Ford Fusion has nothing to do with the value of a 1956 Ford Crown Victoria. In the case with my plane, I have it insured for a hull value of $40,000. It is an "agreed value" policy. If my plane is destroyed, stolen or damaged to the extent it is not economical to repair it, the insurance company will pay me the agreed amount of $40,000. If I add new equipment or do other things that actually add to the value of my plane I can advise the insurance company within 30 days of having added the value and they will increase the "agreed value" limit and I will pay an additional premium. This type of valuation is different from an actual cash value policy and would be subject to depreciation.

[gfeher]

I just carefully read my policy and it is also an "agreed value" policy. So I apologize if I may have caused any confusion. For a variety of reasons, though, I can't imagine that an insurance company will consider the value of a new plane of a different type with new avionics etc. in determining the "agreed value" of a 170 that is about 50 years old, no matter how well the 170 is maintained or how many bells and whistles it has.

[c170b53]

I'm not disputing the thoughts presented here. In my case, I have an engine conversion with a engine rebuild, c/s o/h'd, new paint,new interior and a few mods. It is not a pristine example but B's with low time on components, engine conversion, in good to very good condition generally cost a bit more than 40K.
I think every plane would have a specific story and price.
In some ways I think I understand the premise of the question posed here; A new 172 and a well cared for 170 could equally complete the same mission. And for that reason I couldn't fathom the idea of paying the price of a new 172 for such a plane and I'd likely be shot by my better half if I ever suggested the idea.

[sfarringer]

I think every plane would have a specific story and price.

Absolutely. And that is why the agreed value generally works out, as long as the agreed value represents the ability to replace the airplane with one of the same model in similar condition with similar equipment. My 170 is not at the top end of the spectrum of 170's . But to have the insurance company agree that any 170 is worth the value of a new 172 would be simply amazing.

[KG]

Mine is insured with Avemco for $55k. Raised to that amount from 40k after I sent in the documented expenses for my engine overhaul and related mission creep a couple of years ago. I asked about a higher amount and they declined.

I couldn't sell it for that much yet I have spent more than that on it. That is just the cost of ownership (recouped by the enjoyment of ownership).

For me, the additional premium for the higher value is worth it as I would like to recover some of my dollars in the event I roll it up in a ball.

Ironically, I would be better off financially by crashing it than I would be trying to sell it (assuming, of course, that I don't bump my head in the crash).

[JohnNielsen]

After a complete rebuild with all new parts and engine, I had $125k of documented hard costs into my plane. I was able to get an agreed upon 'stated value' of $125K supported by pics, detailed equipment list and invoices sent to the underwriters prior to their agreement. I would not sell it for less than that and would only be satisfied with a check in that amount if it were ever to become a total loss.

John

[wabuchanan]

This may be my first post on the forum, so if I am comparing apples to oranges I apologize.

In the Insurance business, there are definitions of "ACV" coverage vs "Stated Value" coverage vs "Agreed Value" coverage. I am intimately familiar with these as they pertain to Classic car coverages. I am still learning as much as possible about Aircraft coverage in anticipation of hopefully buying a 170 in my future.

The reason I am posting is that John, above, used the words "agreed upon Stated value" in describing his coverage.

Here is a link describing the differences in the 3 types of coverage. If the terms hold the same definitions in the Aircraft end of the Insurance business, then you need to carefully look at the term "Stated Value"……because you can get burned if you don't fully understand the ramifications of that vs a true "Agreed Value" policy.

Cheers!
Bill

https://www.lelandwest.com/stated-value ... urance.cfm

[flyboy122]

Mike Busch had a good article on the perils of over and under insuring recently. Can't remember if it was in Sport Aviation, or his blog, but it shouldn't be to hard to find. The perils of under insuring are pretty obvious, but over insuring is an interesting case as well. Apparently the problem is that if you over insure it, and wreck the plane, the insurance company might decide it's cheaper to fix it than scrap it out and then you'll be stuck with a rebuilt plane that you had precious little control over the rebuild process.

I love my 170, but if it (for example) goes through the ice this winter and they haul it back out of the lake, I don't want it. But if I over insured it they may decide it's cheaper to send it to Shady Bob's Airplane Fix-it Shop, let Bob sit on it for a year while it dries out, and then give it back to me with a pencil whipped annual. Yeah, I would put the brakes on long before it got to that point, but do you really want to have that fight in the first place?

I currently have my plane insured for what I have in it, which is less than what's it worth. I'm contemplating upping it since it's worth more than I have in it. The insurance company says anything over $50k and they'll need to do an appraisal on it, so that leads me to believe the insurance company probably won't let me over insure it anyway.

DEM