You wonder why; because they can. Sometimes we fight back and get a little more, but most insurance companies have made agreements that are pretty much iron clad with state insurance departments on how they are allowed to determine classic car values regardless of actual values or common sense. As I mentioned one other time, I had a 98 Dakota that I had fixed up and painted. It was really nice. It was hit not that hard, but their insurance totaled it and offered me about half of KBB and NADA based on their own secret book that they updated based on local sales. They don't have to document those sales, OR let me see the magic book based on their agreement with the state. You can sometimes get a bit more than they offer, but getting the true value often requires hiring a lawyer, and the dog crap insurance companies know you probably won't spend $2,000 on lawyer fees to get $2,500 more. I assume the OP did not have a stated value policy with a Classic Car company like Haggarty or Grundy. If he did, there would be no arguing. I know a lot of people who THINK they have great coverage on their classic cars with State Farm, Allstate, Farmers, etc., but when the crap hits the fan, they will probably see that the insurance company will have their own idea of what your car is worth.