Agreed vs market value

• Agreed value is a fixed amount agreed between you and your insurer, while market value is based on what your car is worth immediately before a covered total loss.
• Agreed value offers certainty, but it's important to review it at renewal because your car's value may change over time. 
• Market value can fluctuate based on factors such as age, condition, kilometres travelled and market demand, which can affect your payout amount.

Understanding the difference between agreed value and market value can help you avoid surprises if your car is stolen or written off.

Agreed value is the amount you and your insurer agree to insure your car for. It’s up to you to decide how much cover you need (within a given range).

As a guide, it should be enough to replace your car if a covered incident happened and your car couldn’t be repaired.

You'll receive this exact amount if your car gets written off.We provide agreed value cover with Allianz Comprehensive Car Insurance.

Choosing between agreed value and market value comes down to how much certainty you want. Agreed value gives you more certainty about your insured amount, while market value is based on your car's value at the time of a claim. In some cases, market value cover may also cost less than agreed value cover.

Yes. While agreed value provides certainty, it doesn't guarantee that the amount will always be higher than your vehicle's market value.

Vehicle prices can sometimes rise because of strong demand, supply shortages or changing market conditions.

Example: You insure your car for an agreed value of $25,000. Six months later, used car prices increase and similar vehicles are selling for $30,000.

If you make a claim, your agreed value may be lower than your vehicle's current market value. 

This is why it's important to review your agreed value each time you renew your policy. This helps reduce the risk of being underinsured.

The market value of your car is determined at the time you make a claim. Typically, you'll receive a lump sum based on this valuation. We obtain these valuations from automotive industry resources like RedBook and Glass's Guide, which conduct extensive research to provide accurate pricing and valuation data for used vehicles.

It's important to note that these valuations might differ from the price you could get if you sold your car privately. For instance, some cars might sell for more due to their popularity and limited availability.

The market value takes into account factors such as the make, model, age, kilometres travelled, and overall condition.

In most cases, your car will depreciate over time. This means the payout may be less than you expected.

If you take out Allianz Comprehensive Essentials, you’ll be covered for market value.

Agreed value is a little simpler. Say your car is written off by a covered incident. When you make a claim, the insurer pays you the pre-agreed amount as a lump sum, regardless of market fluctuations. With Allianz, you agree on a set amount to insure your car for when you get coverage.

Additionally, if your new car is stolen or written off within two years of manufacture, you have another option. You can choose to receive the agreed value or have your new car replaced with one of the same make and model where available in Australia.

If you have money owing on your car, part or all of the agreed value payout may be paid to your finance company first. If there's any money left after the loan and any applicable fees are paid, you'll receive the rest.

It’s worth checking if your agreed value is appropriate at each policy renewal. Vehicle values can change over time, and reviewing your cover regularly can help reduce the risk of being underinsured.

We provide market value cover with Allianz Comprehensive Essentials. Your premiums are typically lower with market value because the payout is based on how much your car would likely sell for just before it was stolen or damaged beyond repair. It takes into account factors such as age, condition, and mileage.

“You always think that insurance is a payment that just goes into a hole and no benefits.....until you have a claim. My wife's car was written off. Called Allianz from the scene. [Within] an hour my car was towed away and we were on our way in a rental vehicle. Claim was settled in less than 2 weeks. Amazing service all round. Thank you Allianz!" - Nathan

“Our claim was dealt with quickly and effectively. The fella I spoke to initially on the phone was very good, as was the assessor, who contacted us promptly and explained things very well. Our car was written off and a fair market value price was also promptly placed into our account. Overall we are very happy with the outcome." - Allianz Customer

“Faultless experience. Great staff, personal touch, and a fair result (I was surprised at how quickly we could agree on market value). They've secured a life member in myself." - Daniel

Want to read more reviews? Head to Allianz Car Insurance Reviews for more information.