The value of an older Volvo

[blackdrago]

Hello All:
I drive an automatic 2000 Volvo V70 SE Wagon (blue, if that matters), which now has ~165,000 miles on it. I've had it for a little over a decade. My only complaint about it is that the cupholder is flimsy. That's it. The end.

The car has been very reliable and affordable. Since I bought her outright as a used car, I've only had to deal with maintenance and what I've come to think of as "the annual expensive thing" -- usually replacements for either more expensive parts or a more labor-intensive maintenance/repair to keep her running.

The problem, however, is insurance... specifically the value they attribute to the car. I'm not sure of the exact Blue Book Value of my car at this point, but I'm guessing $2,500 would be a high number for it. She runs perfectly, but has plenty of cosmetic defects that keep her out of the "excellent" tier -- and even if she was perfect, I'm not sure that would make a huge difference in value.

So... if there's any kind of body damage done to my car (especially if it needs to be repainted), that basically means my car is a total loss. Which means any accident above a simple fender-bender could render my car a total loss.

For the past two years, "the annual expensive thing" has been less than $800 - but I know there's at least one big maintenance cost in my future... transmissions don't last forever, after all. And that really would be a gamble, because I'd be spending more than the car is "worth" (according to insurance) to keep it running. So if I get a new transmission and - on my way home - get hit by another car, I'm out several thousand dollars.

I know that if something happens and your car is declared a total loss, you can appeal and get the car's value reassessed/reevaluated by the insurance company, but something tells me that the "reevaluated value" of my old car with a new transmission won't be much higher (if at all) the the Blue Book Value.

This probably sounds trivial, but I really like how my V70 drives--and I haven't test driven anything that feels as good. I'm dreading the process of buying a new car (especially because there's nothing wrong with my car besides a low resale value). And the recent uptick in car prices is really not making me want to bite the bullet and find a new car.

Has anyone been in this situation? What did you wind up doing? Is there a way to increase the value the insurance assigns to my car? I mean... she's 21. That makes her classic, right?

[BlackBart]

The "value" of any car is what the market will pay for it at a given time. However, an insurance company will pay you some contrived blue book or used car value chart number, based on miles and condition and your location. You can argue with them and show them comps of real sales of cars very similar to yours, along with documented condition of your car.

If it's not your primary ride, and it's "classic," you can put it on a company like Hagerty for an agreed upon value... "I think my '63 Corvette split window with 20,000 miles is worth $200,000." Fine, they will give you a price to insure it to that amount in the event of a total loss.

If yours is in good shape with no issues, why would you need to consider replacing? Don't crash it. If you do they will total it, and give you a little check. Take care of it and don't worry.

[BlackBart]

Addendum - Our (my) cars generally get down to the point where collision coverage is not worth the extra cost. If you're paying $500-600 a year and the car is worth $2000, you have to do the math and figure out if that's worth maintaining. If you cancel the collision and someone totals it, you have a lump of parts to sell or haul to the salvage yard and get your $50.

[blackdrago]

If yours is in good shape with no issues, why would you need to consider replacing? Don't crash it. If you do they will total it, and give you a little check. Take care of it and don't worry.

Having not crashed my car for over a decade, I feel pretty good about my ability to continue to not crash it. Unfortunately, I'm not the only person on the road, and I don't have mind-control capabilities to ensure other drivers don't hit me. My car has been in three accidents. Each time, my car was parked (well between the lines in a parking space), and I was standing a few car lengths away when the collision occurred. And the last two were in broad daylight. None of those resulted in serious damage to my car (can't say the same about the other cars), but it still proves that my car is at risk even when I'm not driving it.

I will need to replace the transmission, possibly as soon as next year (I'd be lucky to get another 15k miles), and I personally would prefer to replace the transmission than buy a new car. In fact, replacing the transmission is the more affordable option--until the insurance aspect is factored in.

[abscate]

drive an automatic 2000 Volvo V70 SE Wagon (blue, if that matters)

It does matter, actually.

Your transmission life time is 350,000 miles or more. Drain and fill 3-4 liters of ATF every 30k miles or so and forget about replacing it. If you haven’t been doing this, do three such drain and fills separated by 1000 miles of driving.

You can never insure your way out of risk. Insurance companies are profitable for this reason. The “ total vale” of your car is usually about 60% of what it would sell for in the free market, so in a total loss, you don’t get your value back. That’s the price of life.

Collision coverage on any car in these Fora makes no sense unless it’s a low mileage specialty car , in which case you need a special agreed policy value. I don’t have collision coverage on a single car in my fleet.

DISCLAIMER..don’t take insurance advice from anyone not inyour State. Every state is different, and each insurance provider behaves differently state by state. What State Farm does in NY has no relevance to what the do in PA.

Cars are money losers, not investments. It’s a common fallacy to think that if a repair exceeds the value of a car, it’s isn’t economical. The repair has to be balanced against the cost of the replacement transportation , not the value of the car.

Last note - the collector route usually won’t work for our cars, as the policy will restrict use to low use, weekend driving only, must be garaged ( they do check).

Don’t bother trying to cheat by lying, they investigate thoroughly when you make a claim, amd when they find your out, they keep your money, as they should.

If needed, A$1500 transmission replacement in your car will give you another five years of transportation , or about an additional 3 cents per mile cost. Deprecation on a used ride plus refurbishing cost will be 3-5x higher than that.

[BlackBart]

Really good post from Mr Abscate, all so true.

If your car is violently attracting others in parking lots, I’ll bet your magnets are adjusted WAY too high.

[motormikeyman]

Like you, I love my old XC70. However, I still consider my car disposable and get the cheapest insurance I can for it. Any month is still runs is another month you have no car payment! The insurance payoff if it is wrecked is next to nothing so you need to have enough saved up to replace it or have a down payment for a new one which will require expensive full coverage if financed. Until then, enjoy the savings!

[volvolugnut]

It has been my prediction for years that parking lots are getting a lot worse for accidents.

volvolugnut

[abscate]

Forgot to add

company, but something tells me that the "reevaluated value" of my old car with a new transmission won't be much higher (if at all) the the Blue Book Value.

Correct. You car has basic running value of $1500-2000, if you spend $3000 on a transmission R/R it’s still worth $1500-2000. Likewise the insurance total value will be $1200-deductible or near zero.

For posterity, here is my math on collision.

My most valuable Volvo $$$$ wise is my P2 stick, showing an NADA today of $6800

To add collision with a $1000 deductible costs me another $250 a year

My maximum payout would be $6800*60% or $4000- deductible

If I make it a 50-50 proposition that the accident is my fault, I can recover $500 of the deductible from other driver , on average, so that my payout is this $3500

$250 a year for a maximum $3500 payout is a horrible wager.

The two big savers of running old cars and repairing them is the lack of depreciation and the reduced fixed insurance cost.

[abscate]

I was musing over my stats.

Since 1991 I’ve driven about 1,000,000 miles, about 33k per year.

On average , most people have a big total accident every 15 years x12,000 miles per year , or 180,000 miles. I’ve had one fender bender from following too closely

I’m not a good driver from a control standpoint but I religiously follow two rules…slow and solo,

I drive 3-5 mph under median speed in the right lane on cruise. I maintain at least a 2 second following and usually 3 seconds. It’s really that simple.