Will insurance only pay stated value of my car

There’s a stated value of 5000 for some reason on my 2017 Porsche Cayenne auto
insurance policy, however, my car was declared a total loss as a result of
flooding during Hurricane Harvey. Will the insurance company only pay the 5000
or will they pay the actual cash value of the car? If they only pay the 5000,
what are my options?

Asked on September 10, 2017 under Insurance Law, Texas


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 3 years ago | Contributor

If the stated value is $5,000, that's all the insurer will pay: the policy you bought was limited to $5,000. Insurance policies are contracts; they provide the coverage, and only the coverage, listed on or in them.
Note that the above is if the $5,000 stated limit was in the policy as sent to you previously (e.g. when you'd bought it): if it was, then you are held to it, since you had the chance to review it and change it, but did not. By failing to change the $5,000 previously, you would be held to have agreed to it.
But if the copy(ies) of the policy you'd received previously and agreed to did not have this limit, but the limit was recently inserted, you may be able to escape its effect: the insurer cannot insert a limit or make a change unilaterally, after you had agreed to a different policy. So you should look in your files and see if you'd always had the limit or if the insurer made some change to your coverage after you had bought it.

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