Insuring Luxury Rides – What It Takes To Cover An $85m Car
Sloan Jackson, the general manager for Silver Star Motors, dealers for Mercedes-Benz, did not bat an eyelid as he quoted the price.
“This vehicle is $85 million to start, but if you bring $100 million, we can get you a superb package,” said Jackson.
For that much money, the buyer will get the Mercedes-Benz G65 Wagon, a three-ton military vehicle with a 621 hp V-12 engine and quilted leather.
And yes, there are takers, although Silver Star itself is yet to sell any.
“There are one or two on Jamaican roads but we didn’t bring them in,” Jackson said.
The Mercedes-Benz G65 Wagon was the priciest of luxury vehicles in Jamaica uncovered in a phone poll conducted by Gleaner Business.
There is a well-established market for luxury rides, but getting insurance for those really pricey vehicles is another matter altogether, especially the sporty models.
Gleaner Business posed the question to several insurance companies: Given a driver of many years driving experience, aged over 50, with no accidents for the last five years, how much will you insure this car for?
For vehicles priced under $8 million, the premiums quoted ranged close to $180,000; for those up to $15 million, the premiums were around $210,000; and at $20 million, the premium was around $220,000.
But there were no ready quotes for vehicles priced above $22.5 million.
Still, motor insurance is compulsory, so general insurers have to find a way to cover them. So, for the most expensive models, their answer is to split or co-underwrite the risk.
“You will be driving around with a policy that says ABC Company, but, in reality, another company acts as the reinsurer,” said one insurance industry representative.
The shortlist of vehicles in the multimillion double-digit price includes the brutish Jeep Grand Cherokee SRT for $15.48 million; Porsche Panamera for $31.5 million and the Audi R8 for $35 million, both sold by ATL Automotives; and the Range Rover HSE, Vogue or Autobiography for about $36 million from Stewart’s Automotive.
The list is rounded out by the most exclusive of the lot, Mercedes-Benz. Silver Star quotes prices ranging from $24 million for the GLE 43 Coupe to $40 million for the GLE63 S Coupe for models now in its showroom and some already on the roads.
But the company recently sold a Benz for $72 million, according to Jackson, who refused to provide details of the model.
“We can’t say anymore since it may identify the customer,” he said.
Gleaner Business sought insurance quotes for the $40-million vehicle, which one general insurer flatly said it would not cover, while others said coverage would require “special consideration”.
That special consideration means the insurer would reach out to two or more other general insurers with a request that they join together to underwrite the policy.
The most accommodating insurer, based on our poll, appeared to be BCIC.
“Yes, we certainly would insure up to $15 million without referring the matter and up to $30 million, based on an assessment by our in-house risk committee. For $40 million, we will do that on a case-by-case basis, but we would definitely consider it,” said Michelle Anderson, general manager, sales and distribution.
Anderson also said BCIC is one of the companies that co-underwrites or reinsurers insurance policies for big-ticket vehicles, such as high-value supercars on Jamaican roads.