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December 11, 2012

Classic car insurer rocked by Hurricane Sandy

TRAVERSE CITY, Mich. — When Superstorm Sandy struck along the East Coast,  a Michigan insurance company felt the full wrath of the hurricane’s punch.

Traverse City-based Hagerty Insurance — the largest insurer of classic cars worldwide – is now dealing with the storm’s afterrmath.

Hagerty insures 10,000 classic cars on Long Island, N.Y., alone, and the company already has received 1,100 Sandy-related car claims, as well as claims for about 50 boats.

Storm claims already are valued at $10 million and counting, said company President and CEO McKeel Hagerty.

“There are no million dol­lar cars,” he said. “The av­erage cost is under $50,000.”

Hagerty Claims Assistant Manager Michelle Ayers said calls from customers began Oct. 29 and contin­ued steadily through the next two weeks as evacuees returned to their neighbor­hoods.

“It was everything from ‘I just lost everything I’ve worked hard for my entire life — it’s all gone’ to ‘What do I do from here, where do I go from here?’ Ayers said. “We talked a lot about, obvi­ously, their cars, because it’s like a family member to them. A lot of the people I talked to, anyway, (cars) had been passed down from generation to generation.”

Hagerty said the company immediately responded by working with salvage companies and adjusters in an effort to flush out car engines that had been im­mersed in water. Hagerty received three times as many claims from Sandy as it did from Hurricane Ka­trina, but damage charac­teristics are similar.

“The thing they have in common is they are really flood more than wind dam­age,” Hagerty said

About 70 percent of the claims represent total loss­es, but 50 to 70 percent of those owners want to keep their cars after the insur­ance payout, Hagerty said.

“They keep the salvage and they’re going to re-re­store the cars,” he said. “To me, that’s a little light at the end of the tunnel.”

Hagerty itself is insured against catastrophic events like Hurricane Sandy.

“Katrina taught us a lot about that,” he said.

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Details for this story were provided by The Record-Eagle in Traverse City, Mich.

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