Insurance quandary...title vs reality

[Reiver]

The title for my soon to arrive Caterham (professionally built titled in the north east originally) is a late 90's Vauxhaul Caterham 2L full on build.  DCOE's, Hydraulic cam upgrade etc.... but was titled as a 67 Lotus and has a Lotus Vin plate with number.  This was done in a state that recognized pretty much whatever you wanted in replica/recreation.

It has since been transferred to Michigan and registered as the same...Lotus '67.  I don't know that I am comfortable insuring that as a '67 even tho the title is legit.

 

Any experience with this issue..... emissions is not an issue...my county has no emissions laws nor inspections in AZ. 

Edited December 24, 2024 by Reiver

[CBuff]

My 2023 420r is titled as a custom vehicle here in New York.  Insurance wise I originally attempted to register it as a caterham ( which they would do - Hagerty). Once I got the title and it was listed as “custom” Hagerty changed it to model= custom ( and the price went down).  Anecdotally I would think that insurance will follow suite with the title. If you do agreed value then it shouldn’t matter as far as reimbursement goes.  Not sure if AZ has any issue with the way it’s titled.  I was very upfront with Hagerty ( especially since I started the process calling it a caterham ). A lot of my back up was from caterham and stated as such. So I was very transparent. They said “ if New York calls it a custom that’s what it is). So if it’s titled a 67 lotus I would think insurance will not question it. 
 

not sure if this info is very helpful but it was my experience. 

[Reiver]

That is very helpful, and Az has no issues at all transferring it as is.  I'd forgotten about the agreed upon value event as that basically makes it a moot point in many regards as to 'fairness'.

Regardless I will call the insurer and discuss this...

Edited December 24, 2024 by Reiver

[IamScotticus]

Even at Haggerty,  you must find an agent familiar with 7s.

After my self induced "accident", which was minimal damage, I told the claims agent about it, who was then set on sending me to a body shop.  Um, no thanks.  

***Hijack alert***

Interestingly, in 2025, Texas will be dropping the safety inspection requirement for road vehicle registration renewals. Yet, emissions will still be required in various counties.  

I can't think of a dumber thing.  The logic of it, that I have heard, is without someone looking and telling you of a safety issue,  the owner will be more attentive to the particulars.  HA! 

These people here rotate through used cars straight out of the Insurance write-off auction yards.  They sell them back to the dealers for another car before the registration deadline to avoid being on DMV records and having metal plates the police and plate readers can identify them by.

We, enthusiasts of outstanding moral character,  hit these registration and safety and emissions compliance walls trying to do the right thing.  There are much bigger problems afoot.  And once you get out there, you have to worry about being squished.

 

So, things have to be kept simple.  A banana is a banana no matter what sticker it has, right?  Dole, Chiquita, etc.  The registration is concerned with how to TAX your vehicle, they don't care about the history. So you stick with something familiar that is recognized by the people processing your application.  In our case, they recognize Lotus, and maybe the 7 as a model.  It doesn't matter who made it.  For tax purposes you have a 4 wheel convertible top passenger road vehicle made by Lotus in 1967.  That's your banana.  The sticker on it is Caterham, or Robin hood, or Birkin, or Zero, Westfield, etc.  

If you have a jurisdiction that has a registration for replica cars, the snag they might have there is emissions may need to be compliant with the year of manufacture,  not the year of replica.  This may not be a problem for a current owner, but might become a problem for the next guy who's jurisdiction is enforcing year of manufacture IM standards.  And there are kit cars, gliders, etc.  It gets too complicated.  This is why we just register the 1967 banana as a 1967 banana.

 

This is not professional or legal advice.  Just a schmuck who over complicates everything. 

Edited December 24, 2024 by IamScotticus

[mrmustang]

13 hours ago, Reiver said:

The title for my soon to arrive Caterham (professionally built titled in the north east originally) is a late 90's Vauxhaul Caterham 2L full on build.  DCOE's, Hydraulic cam upgrade etc.... but was titled as a 67 Lotus and has a Lotus Vin plate with number.  This was done in a state that recognized pretty much whatever you wanted in replica/recreation.

It has since been transferred to Michigan and registered as the same...Lotus '67.  I don't know that I am comfortable insuring that as a '67 even tho the title is legit.

 

Any experience with this issue..... emissions is not an issue...my county has no emissions laws nor inspections in AZ. 

Having been actively involved in kit car circles since the 80's I can tell you that back then, states titled cars as whatever the MSO stated, or in the case of Caterham offerings, if a state had the VIN format for a Caterham already in the system, instead of reinventing the wheel, the DMV/MVS clerk used whatever was already listed in regards to make a model. It was the mindset of "why rock the boat and create more paperwork" Some states are still like this. While others won't accept the factory VIN, and will force the owner to a state issued VIN tag pop riveted to the car, usually near the factory Caterham chassis tag.

  As for how it is titled, for the state, again, they simply do not care, for your insurance company, as long as you have provided the details of the car to them, regardless of how it is titled, they really do not care. To them, it's just another 2dr convertible, it's really your ownership and driving history that will affect rates, same goes for where it is primarily stored, as your zip code, and where that falls in the crime database is more than 50% of the deciding factor in your cars rate for your stated value.

 

Hope you find this helpful.

 

Sincerely,

 

Bill S.

[Reiver]

Thanks gents....  "it is all becoming clear to me now.." Inspector Jacques Clouseau 

Edited December 24, 2024 by Reiver

[slowdude]

Echoing @CBuff, Hagerty agreed upon value is the way to go. It also helps if you have done any modifications etc. Big peace of mind. 

 

You don't have to worry about title / registering. I'm unclear on your hesitation.

 

Are you concerned with re-sale on the title? You have a registration for a that specific 17 digit vin, and the insurance is for that specific vin number.

 

 

 

[Marek]

When learning about the Sevens world before acquiring my car, I came to several conclusions;

• 'Originality' for Sevens is its own, fairly unique, aesthetic - and generally does not affect values.
• The notion of 'Clean Title' is deeply muddled - and has no apparent affect on values.
• After 'tasteful versus not' and condition, the greatest affect on value is whether or not it is a Caterham (yes, we can talk about a few other names here).

These factors make Sevens valuation a very different algorithm than any other vaguely-modern car*.

 

All this is to say I came to the conclusion that when looking at Sevens it is best to check my notions of car valuation at the door.

 

* Elise are worth noting here...such a high percentage have salvage titles, and for non-chassis reasons, that the title status of an Elise has much less affect on values than any modern car I have encountered.

 

Edited December 24, 2024 by Marek

[Reiver]

Thanks, not confused and will identify the vehicle and the registration both with agreed upon value.... I've done the agreed prior with numerous vendors but the title matched the actual vehicle.

[IamScotticus]

44 minutes ago, Marek said:

it is best to check my notions of car valuation at the door.

These were supposed to be cheap throw away club racers that anyone could afford.  Cat did a fine job building them up into pretty tightly packaged techno marvels you don't dare put a scratch on.  

Guess what? 0-60 in 7sec and rollercoaster road Manners, harness tails slapping you in the face, burnt ankles, entry exit gymnastics, and getting stranded any time can be had with a  40yo $18-20k used beater.

Not many cars hold value as well when cared for, but loose so much when wrecked. 

Edited December 24, 2024 by IamScotticus

[spitfun]

I would suggest NCM (National Corvette Museum) for insurance. They run the insurance thru American Modern,but the rates are better going thru NCM-not sure why. They go by stated value and I have had many cars thru them (including 7 replicas and others) stating manufacture date on title of 60's or 70's cars with no issues. The advantage of backdating is in a state that has emissions they are usually exempt because of date (again usually 60's or 70's manufacture-SUPPOSEDLY) on title.

Edited December 24, 2024 by spitfun

[jimmylukeii]

Hagerty does not care.  Mine is registered as a 1960 Lotus.  I made sure to disclose that it is actually a 2022 Caterham in the application.

 

Two claims later (ugh) no issues whatsoever.

[Reiver]

Thanks..... they've sent a very nice quote.

[minimallyviable]

Hi everyone.  I’ve been in lurk mode looking for a 7 and have a couple of prospects. The issue is the title.
As discussed above there may be no issue with not having a “clean” title.  In New Mexico it seems that a kit built car (factory frame and other components) but assembled by someone other than the “factory” will have a “rebuilt” tootle, not “salvage”.

If the car has a normal title from another state, the title status would follow.  I’m tempted to pass on at least one of the prospects for one with a title that more accurately describes the car. 
I was wondering what thoughts you all

might have

 

Thanks!

[Reiver]

States may very but in Az my 99 Caterham had a '67 Lotus title and that is what my new Az title will reflect....when getting collector Insurance I told the insurer it was a 99 Caterham but the title reflected something else.... they went with the '67 Lotus and a full agreed upon replacement price.... it was not an issue. 

[MV8]

10 hours ago, minimallyviable said:

Hi everyone.  I’ve been in lurk mode looking for a 7 and have a couple of prospects. The issue is the title.
As discussed above there may be no issue with not having a “clean” title.  In New Mexico it seems that a kit built car (factory frame and other components) but assembled by someone other than the “factory” will have a “rebuilt” tootle, not “salvage”.

If the car has a normal title from another state, the title status would follow.  I’m tempted to pass on at least one of the prospects for one with a title that more accurately describes the car. 
I was wondering what thoughts you all

might have

 

Thanks!

Can't be very specific with so few details in your post, but generally and historically, a car can be built using a donor.

The completed vehicle may be inspected for retitling as something other than the original donor or kept as the original title without inspection.

Some States take issue with a vehicle that doesn't appear to be the donor. The insurance co may take issue with claims or continued coverage (even basic liability) if they find the car is nothing like the policy description. The line between customized and being something else is usually drawn in mud.

A donor may be damaged sufficiently to become "salvage" and then "rebuilt", but the differences range from essentially nothing to major. State code mostly supports insurance companies so they will do business in the state. One common rule is requiring a title to be surrendered on a vehicle if the payout exceeds a percentage of the blue book value. Low value donors may become salvage titled if a claim is paid to repair a scratch in the paint. The owner has the salvage donor inspected (with or without repairing the scratch), and gets a rebuilt title. Some States will not allow a vehicle on the road based on having been "rebuilt" a few times (more money for them if you replace a vehicle instead of repair). The owner has the option of not taking a payout from the insurance co and keeping their title clean. They can also sue the other person instead of accepting the same amount from the insurance co and losing the title.

Talk to your insurance co about covering a retitled kit versus a kit that still has the original clean or rebuilt title. Note they may change their mind in the future and decide not to renew (like three wheelers after the insurance nightmare/hooliganism that was the T-rex).

 

Another common rule that helps the state and insurance companies is that local municipalities may not bill the insurance co for the cost of cleaning up an accident. The local services are already paid for but they can still bill a vehicle owner directly for clean up (typically fire department collecting the pieces and maybe sweeping a few minutes). No fault needs to be found for the accident.

[minimallyviable]

Thanks for that.  Interesting.  I've had Hagerty on my (currently owned) Elise along with a 67 Elan and a 73 BMW.  None of those had any issues with insurance or titles so this issue is very new to me.  I'm gathering more info from the current owners of the cars I'm looking at and as I get that I'll be able to ask better questions of the DMV.

 

I hope I'm not hijacking a thread with my questions here.  Maybe a thread on the forum for questions about insurance and titles would  be appropriate.  I'm willing to help with that if it goes forward.

Thanks again for all the input.

[Lancefitzgiben]

I wonder if there's room for improvement on my hagerty policy, which is agreed value ~60 for ~800/year. When I was initially quoted the number was half of that, but then it was decided that it's "modified" (I don't know if that's old terminology or differs from "custom". I'd have to pull it and look but the title should just be for a 57 caterham. I'll have to open up some dialogue with hagerty anyhow to get agreed value on a heavily modified NA miata, I'll ask some questions.