Agreed value and market value are two different ways an insurer can determine the insured value of a vehicle.

Not every insurer or product offers both options.

What is agreed value? #

Agreed value is an amount agreed between the insurer and policyholder when the policy is arranged or renewed.

Subject to the policy, this amount forms the basis of a total loss settlement.

What is market value? #

Market value is generally based on what the vehicle was worth immediately before the insured loss.

Factors can include:

• Make and model.
• Age.
• Condition.
• Kilometres travelled.
• Vehicle specifications.
• Current used vehicle market.

Which amount is more predictable? #

Agreed value generally provides greater certainty because the insured amount is established in advance.

Market value can change over time as vehicle values change.

Does agreed value remain the same forever? #

No.

An agreed value can change when the policy is renewed.

Review the amount shown on each renewal rather than assuming it remains unchanged.

Does a higher agreed value affect the premium? #

It can.

The vehicle value is one of several factors that can affect the premium.

The appropriate value should reflect the vehicle rather than simply choosing the highest possible amount.