Used truck values have continued to rebound after beginning to recover mid-2020, which comes on the heels of declines reported during previous years. What this means is that now is a good time to talk with your insureds about their truck valuations, and determining adequate values to schedule on their physical damage policies.
Making sure values are as accurate as possible is a conversation that needs to be had. The failure to do so could result in a vehicle being under-valued in the event of a loss, especially with re-sale values on the rise. A simple conversation about the right value at the time you’re gathering information at each policy renewal is all it takes, along with having awareness of the used truck market.
In general, an over-abundance of used trucks on the market will cause valuation to decrease. This is what caused Class 8 truck values to decline beginning in 2019 and 2020. COVID-19 has created a demand for more of what’s known as last-mile delivery, with more and more people having items purchased on-line delivered right to their homes. As a result, the number of available used trucks in the Class 8 market has plummeted, causing an increase in values for these vehicles. According to sources, a vehicle that may have sold for $30,000 on the market last year might sell today for up to $55,000.
However, keep an eye on the market because this won’t last forever! Remember the old supply and demand curve? Everything fluctuates based on available supplies along with demand for the product, and truck prices are no different. Key your eye on the economy and on those values as well.