Insurance glossary
Agreed value
Quick definition
A pre-negotiated value written into your policy schedule, paid out regardless of market price at the time of claim. Most common for classic cars, modified vehicles, or rare imports where book value is unreliable.
Understanding Agreed value
Most policies insure on retail or market value — a figure the insurer determines from the trade guides at claim time. Agreed value instead fixes the sum insured up front, settled between you and the insurer when the policy is taken out, and usually backed by photographs, a valuation certificate or a condition report. It often carries a slightly higher premium for the certainty it gives.
It exists for vehicles the standard guides price poorly: classics and collectibles that appreciate rather than depreciate, low-mileage or concours examples worth more than book, and modified vehicles whose extras a market valuation simply ignores. For these, a retail settlement can fall well short of the car's true worth, and agreed value closes that gap.
The discipline is to keep the agreed figure current — review it at each renewal as values move, and retain the supporting valuation and photographs, because an agreed sum is only as defensible as the evidence behind it.
Related terms
Definitions reviewed by the OneCompare editorial team. OneCompare (Pty) Ltd is an Authorised Financial Services Provider (FSP 55551).
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