Insurance and declining coach value

[Coloradobus]

We checked last summer to change our "Agreed Value" from $500K to $350K. We decided not to do it since the savings amounted only to $185.00 annual reduction.

[Jon Wehrenberg]

If your agreed value exceeds the market value substantially, make sure the insurance company and you are in agreement with what you are doing. I would get their acknowledgement in writing. You are spending the extra premium to insure if it is totalled you are adequately compensated, and they accept that premium. But when push comes to shove without their acknowledgement that what you are doing is OK with them, you are either going to have to fight to get your money, or they will do $350,000 in repairs and return a junk coach to you.

Insurance companies are all about money and you will both be fighting over the exact same dollars.

They can easily take the position you over insured the coach and then drove it over a cliff to make money at their expense.

[Ray Davis]

When I went through the recent insurance claim on my coach, even though I had an agreed upon policy, they went to great lengths to validate the value of my coach. Luckily the fire happened prior to the huge downturn, and I was able to get my insured value.

I have no doubt that 3 months later, I would have been given substantially less, even though I was insured for a higher value.

Ray

[phorner]

Ray,

Would it be fair to say that several months later it also would have cost less to replace your bus?

Or, do you feel that in the long run you made out better by finally getting the agreed value?

[Jon Wehrenberg]

Valid point Paul, but insurance underwriters generally go on past history and don't predict the future such as economic downturns.

They would likely have stiffed Ray if the downturn had begun in advance of his loss. The presumption that is incorrectly made is that the cash for a total loss is going to be used to buy another coach. Suppose a person who has just suffered a loss chooses to use the funds to which he is entitled for other purposes? Suppose the downturn leave a person who is still making payments upside down, even though the coach agreed upon value was sufficient to satisfy the debt?

When we had our fire they paid the tab with no debate. I am glad I did not have to argue to collect a value I had been paying premiums for.

[Yankee802]

Seems to be a lot of fires people have experianced, what are the causes on average? I'd like to be proactive in preventing these, I don't want to have a loss and then deal with my insurance co.

[Jon Wehrenberg]

There are as many ways to have a fire in these buses as there are owners.

In my case a new AC compressor was installed by Carrier Corp. The technicians did not re-install the unloader valves saying the internal pressures would never get high enough to require them.

Apparently the pressures got high enough to blow out the compressor seal behind the clutch. The compressor locked up, freon and compressor oil was blowing out the seal and the spinning compressor drive belt running against the now locked up pulley heated up and became the ignition source for an engine compartment fire. 24 pounds of freon and a gallon of compressor oil, on fire becomes a very effective blow torch when it is spraying out under pressure.

The bill was $82,000. No damage to the coach interior, not even the odor of fire (thanks Liberty), no damage to the engine itself, the transmission, or the main rear electrical box, but the fire melted 10 batteries, burned up the Vanner equalizer, all rear cap wiring, the AC hoses, the rear cap and the RH rear door needed to be replaced.

[Ray Davis]

Would it be fair to say that several months later it also would have cost less to replace your bus?

Or, do you feel that in the long run you made out better by finally getting the agreed value?

Paul, indeed I was able to replace my bus for less than I had originally paid. However, there is still that gnawing feeling that I paid $X for something, and six months later they could have given me less.

The insurance however did NOT cover the $!5K satellite system I had put on the coach, nor did it handle the $25K of sales tax I paid as well. Plus much of the interior "stuff" had to all be replaced. So, all in all, I think I came out OK, but not great. I am still hoping (but not expecting) to get the additional $25K I paid in sales tax for my current coach back.


Geoff, in my case fire was caused by parking in a building where someone else's coach caught fire. It was a Dometic refrigerator which did the trick.

Ray

[Kenneth Brewer]

Jon,

Did Carrier make good on this, if I may ask? Did they acknowledge any fault or misinformation?

[Jon Wehrenberg]

Ken,

I had National Interstate through Explorer ( a P-Stuff sponsor and POG supporter ) and they took care of everything. I documented what happened, including providing them with the invoice for the compressor replacement 400 miles prior to the fire.

I suspect Carrier and National Interstate arm wrestled over liability, but in the end Carrier had to end up writing the check because they left off the valves despite my best efforts to insist they install them. The first thing Prevost commented on when they saw the coach was "where are the unloader valves."

I do not know for sure about Carrier paying, but in this case the insurance company must have expected it because they agreed to every requirement I had including a complete new AC system including hoses due to my suspicion pressures may have damaged other parts of the system.

I put out the fire with the help of my nephew and we both saw first hand the blow torch like flame coming from behind the AC compressor clutch and literally curling up and over and then down to the batteries and all the other severely damaged components.