Why would Shannons pay to repair my car for $3,850 when they could write it off and save $2k+???? – I bought my matching numbers 351 XD Falcon S pac in 2005 for $3,800 and comprehensively insured it with Shannons straight away mostly because no one else would due to it being lowered, having some minor engine modifications, extractors etc. Shannons would only insure it for the purchase price at the time. Over the past years I've put some money into it and a few years back argued with them that the car is worth more than I originally paid and they begrudgingly increased the value to $5,000.

The market value of the car is probably closer to $10,000 however I never pushed for anything much because I hardly ever drive the car (1000km per year tops), don't park it in shopping centres, and it is safely locked up in my warehouse which has back to base alarm monitoring.

Anyway, two weeks ago the unthinkable happened and a pile of pallets fell on top of my beast damaging the roof, bonnet, door, left front guard etc. Put in a claim to Shannons, paid my $550 excess and got a quote that the repairs would cost $4,400 (cost to Shannons $3,850 after my excess contribution). I breathed a sigh of relief that the repair costs were less than what the car was insured for and thought things would be okay... until the assessor called. Because the costs for repair were so high and the car was only insured for $5,000 he said that it would have to be considered a repairable write-off and wanted photos of the car so that they could be submitted to a salvage company. He questioned why I hadn't insured the car for more but I said that Shannons wouldn't do it.

Shannons' salvage company valued my car at $3,000 to sell for parts etc, so Shannons said sorry but we're writing off your car, but you can buy it back if you like. I argued why don't they just fix it, the cost of repair is less than what I was insured for but the argument from the assessor was, basically, it's cheaper for them to write it off. They'd hand me $5,000 (less my $550 excess) and then flip over the car to the salvage company for $3,000 or give me the option to buy it back at the same price. Total cost to them: $1,450 (under $1,000 if you also take into consideration how much I paid for insurance this year). So at the end of the day I was paying about $400 a year for an insurance policy that only paid out $1,450 on a car insured for $5,000.

I ran my car specs through the Shannons website for an online quote to see if I could've possibly insured it for more as I was chided to do by the assessor. The result? I couldn't even insure it for $5,000 let alone the $10,000 I think it's worth because it was "above the allowable maximum" that Shannons were allowed.

The moral of the story: If Shannons won't insure your car for what it's really worth, you're wasting your money with them as they'll write off your car and sell it for parts even if the cost of repair is less than your insured value. Good marketing Deliberately undervalue cars so that you get stung when making a claim.