The Invention of Agreed Value Insurance

Agreed Value Insurance has become a cornerstone of the collector car hobby. James A. Grundy actually invented this special insurance in 1947, and this is how he came to do it:

At the turn of the last century, Colonel Sam Baily was a Philadelphia businessman who saw that the automobile was going to replace the horse as the primary means of transportation. He and several of his associates founded the Pullman Automobile company in York, PA, and manufactured stylish, powerful, and expensive touring cars. His son Sam raced Pullmans as a way of promoting the brand to the public. Sam was involved in a racing accident, and the injuries forced him to stop competing. Colonel Sam sold out his portion of the business at its peak and moved on to other endeavors.

Son Sam was determined to remain in automotive manufacturing however, and built refrigerated truck bodies near Philadelphia. He built all of the Good Humor Ice Cream truck bodies, for example. This business generated a good deal of scrap, which Sam would take to Philadelphia and sell. On one of those trips, he spotted a 1909 Pierce Arrow atop the pile, destined to be broken up. He recognized the beauty of the car and the importance of preserving the history of early automobiles. So, he traded his load of scrap for it and hauled it back to his factory where he and his men restored it. This is the very first documented automobile restoration for historic purposes. This important car now resides in our lobby and is occasionally used for touring even to this day.

Sam’s friends were watching all this with interest, and decided they, too, would like a beautiful old brass era car. Sam became quite active in finding and restoring these old gems, and he and his friends went on to organize the hobby and form the Antique Automobile Club of America currently located in Hershey, PA. During this time, Sam amassed a significant collection of these historic cars.

Now, Sam had a daughter Patty who was wooed and wed by James A. Grundy after he returned from World War II. Using money from the GI Bill, he started an insurance business that offered all types of insurance. He was keenly interested in insuring Sam’s factory, and Sam agreed as long as James could meet certain conditions.

Sam stipulated that for his son-in-law to insure his factory, he had to figure out a way to insure Sam’s car collection at low cost. Also, he wanted the cars insured for their full value because he had spent considerable money to restore them and they were increasing in value. His cars were in excellent condition and well stored, but they spent most of their time just sitting and were only sporadically driven on special occasions. His regular car insurance didn’t work for the collection because it didn’t recognize limited use, and it would depreciate the cars even though they were not losing value.

James Grundy responded to these stipulations by inventing Agreed Value Insurance that is very low cost, yet insures an automobile at its full value forever. Another innovation that he added was providing liability protection for multiple cars but only charging for one, because he reasoned that you only drive one antique car at a time. These were major insurance innovations, and they are the foundation upon which every collector car insurance company bases its business. By lowering the cost of insurance, these inventions make it possible for more people to participate in the hobby. Not only that, Grundy’s invention delivers superior insurance protection for these special vehicles as well. James Grundy got the insurance contract for his father-in-law’s factory, but what he created in the process is much bigger than he ever imagined.

Today, Grundy Insurance protects well over a million individual vehicles and a number of major collections, and is the largest insurer of several categories of collector cars. We have recently extended the concept of agreed value to include not only collector cars, but also regular-use vehicles including light trucks, trailers, motorhomes, daily drivers, and more with our Motor Vehicle Program. MVP is now the fastest growing area of our business, and further validates the original Grundy concept of Agreed Value Insurance.

We are the original agreed value collector car insurer. Nobody knows more about insuring collector vehicles than Grundy!