Agreed value vs market value car insurance in New Zealand

What is the difference between agreed and market value?

Agreed value is a figure you and the insurer settle when the policy starts and at each renewal, so you can read it before anything happens. Market value is what the vehicle was worth just before it was damaged, worked out afterwards by the insurer. The difference is when the number is decided, and who decides it.

Consumer Protection (MBIE) defines both in one line each:

“Market value — what your vehicle is worth just before it is damaged. Agreed value — a value you and your insurance company agree on when you take out your policy and each time it renews.”

— Consumer Protection (MBIE), Car insurance, read 2026-09-16

The practical difference is about when the number is decided, and who decides it. With agreed value it is on the policy before anything happens, and you can read it. With market value it is worked out afterwards, by the insurer, from what the car was worth at that moment.

Which insurers offer agreed value in NZ?

Both bases are common here and several insurers sell both, so the answer is on your own schedule rather than on any insurer's front page. Of the eight on this site, three publish agreed value as their basis, four publish either, and one publishes agreed value on comprehensive and market value on third party fire and theft.

Several insurers sell both — the schedule tells you which one you have. AMI's wording is typical of the direct insurers:

“Your policy schedule shows whether you have an agreed value or market value policy.”

— AMI, Car Insurance Policy Wording AMI0052/11 (November 2024), read 2026-09-16

Does an agreed value stay the same every year?

No, and this is the part most people miss. An agreed value is agreed for one policy period and commonly reset at renewal, usually downwards as the car depreciates. AA Insurance reviews it at each renewal; Vero uses market data to set a new one. Read the figure on your renewal notice.

This is the part most people miss. An agreed value is agreed for a policy period, and it is commonly reset at renewal — usually downwards, as the car depreciates. AA Insurance:

“The agreed value is the amount determined when your policy begins and at each renewal. The agreed value is reviewed at each renewal and may be adjusted as the value of your vehicle depreciates”

— AA Insurance, Comprehensive Car Insurance Policy (updated April 2025), read 2026-09-16

Vero says the same thing and names the mechanism:

“When we renew your policy, we may use market data to review and set your new agreed value. As a result, the agreed value will usually decrease as your vehicle depreciates with age and use.”

— Vero, MotorPlan Policy (effective 1 December 2025), read 2026-09-16

Who decides what my car is insured for?

Not always you. Cove sets a default sum insured from a third-party vehicle valuation service and lets you change it. NZI ties agreed value to a valuation less than 24 months old. If the car is modified, imported or unusual, this is the clause to ask about before you buy rather than at claim time.

Cove sets a default from a valuation service and lets you change it:

“When calculating your quote we set a default sum insured value using information provided by a third party vehicle valuation service.”

— Cove Insurance, Car Insurance, read 2026-09-16

NZI ties agreed value to a recent valuation: “Agreed Value for your vehicle sum insured where a valuation is less than 24 months old.” If your car is modified, imported or unusual, this is the clause to ask about first.

Is agreed value car insurance worth it?

It is worth most when the car's market value would be hard to pin down or would fall short of what you need: a modified, imported, classic or rare car, a car still on finance, or one you would replace with a near-identical model. On an ordinary, older car the two figures tend to sit close together, so the difference at claim time is small.

The value basis only matters on one kind of claim: a total loss, where the car is written off or stolen and not recovered. A repairable crash is settled on the cost of repairs either way. So the question is really: if this car disappeared tomorrow, would a figure worked out afterwards be enough?

Where the difference tends to be largest

• Modified cars. A market valuation looks at what comparable cars sell for, and most comparables are stock. Our modified car insurance guide covers how insurers want modifications declared.
• Classic, imported or uncommon cars. Few comparable sales means a market value is harder to agree on after the event. See classic car insurance in NZ.
• A car with a loan on it. A write-off pays the insured figure, not the loan balance. If the loan is larger than the car's market value, the gap is yours to pay.
• Cars that hold their value. Some models sell second-hand for close to their new price. If an agreed value is reset downwards at renewal on a car that has not lost value, the renewal figure is the one to check.

Where it tends to matter less

A common, older car with plenty of comparable listings is easy to value, and its market value and agreed value usually sit close together. Agreed value cover can cost more in premium, so on a car like that you are paying for certainty about a gap that may be small. Some insurers only sell one basis anyway; the table above shows which.

What gets paid if the car is written off? A worked example

On agreed value, the payout is the agreed figure on your schedule, less your excess. On market value, it is the insurer's assessment of what the car was worth just before the loss, less your excess. The example below uses round illustrative figures, not quotes, to show where the gap comes from.

Two things in that example are worth reading on your own policy. First, the agreed figure is the one on this year’s schedule — AA Insurance and Vero both say it is reviewed at each renewal and usually goes down. Second, the excess comes off either way; our car insurance excess guide sets out each insurer's published excesses.

What should I ask before choosing a value basis?

1. Is this quote agreed value or market value? Get the answer in writing, and check it matches the schedule when it arrives.
2. If it is agreed value, what is the figure, and who set it — me, or a valuation service?
3. What happens to that figure at renewal, and will the renewal notice show it?
4. If it is market value, how is the market value worked out, and what evidence would I be able to put forward?

Those four questions are on the printable pre-quote checklist, along with the excess questions and the driver questions, so you can take them into a quote call.