kthompson
Elite Member
- Joined
- Sep 12, 2008
- Messages
- 3,497
- Location
- South Carolina
- Tractor
- Kubotas B2710, M6800, L6060 cab, Volvo EC excavator, 2 ZTRs and various implements.
Ran into this today and wanted to share with you. If you get insurance on your tractor and it has such as front end loader be sure it is insured to protect the tractor and the front end loader. Read coverage with Sentry insurance today who John Deere uses and they may have others no idea on that but the way they determine the amount they are liable for in case of a claim they look at the lowest of the actual cash value or the purchase price and there was one other part they also work off of and they will only pay the lowest of those numbers.
Say you paid a premium price for a front end loader and it was totaled they would probably use the actual cash value of the full market. But say you got a deal on a front end loader they would only insure the lower price you were able to get it for. Somehow this insurance agent finds that not fair. When a loss is incurred what you paid for it normally has little input into the calculation. It is what the item is worth. The way it was explained to me they only consider the purchase price in what you paid for again such as a loader and not the cost of any improvement you made to the tractor or attachment.
Let me use something different here; you buy a pickup for say $50,000 and a friend buys one just like yours for $55,000 and when two years old both were totaled. They do not consider the purchase price but the value of the pickup when they were totaled.
What am I saying, be sure you READ the contract and not assume anything. Using their logic you buy a tractor say in rough condition needing major repairs and you made those maybe spending more than you did for the tractor, you would not be given any credit for the value added to the tractor by those repairs. To "me", something about this does not make sense. The short is their contract uses again I think it was three ways to calculate what they determine the lowest amount they owe for a total loss. Not aware of any other property insurance that gives some many options to determine the value of the loss.
Say you paid a premium price for a front end loader and it was totaled they would probably use the actual cash value of the full market. But say you got a deal on a front end loader they would only insure the lower price you were able to get it for. Somehow this insurance agent finds that not fair. When a loss is incurred what you paid for it normally has little input into the calculation. It is what the item is worth. The way it was explained to me they only consider the purchase price in what you paid for again such as a loader and not the cost of any improvement you made to the tractor or attachment.
Let me use something different here; you buy a pickup for say $50,000 and a friend buys one just like yours for $55,000 and when two years old both were totaled. They do not consider the purchase price but the value of the pickup when they were totaled.
What am I saying, be sure you READ the contract and not assume anything. Using their logic you buy a tractor say in rough condition needing major repairs and you made those maybe spending more than you did for the tractor, you would not be given any credit for the value added to the tractor by those repairs. To "me", something about this does not make sense. The short is their contract uses again I think it was three ways to calculate what they determine the lowest amount they owe for a total loss. Not aware of any other property insurance that gives some many options to determine the value of the loss.
