A family friend is an attorney who deals everyday with insurance claims. Allstate is one of a half dozen companies he told all of us to NEVER do business with. If there's a claim, he said to expect to get 1/10th of what ever they promised and a small fraction of what ever its worth, or as little they feel they can get away with.
Years ago my dad had bought a brand new Ford Crown Victoria, it was parked in the lot of a local grocery store, it had been mine for just four days and had less than 100 miles on it. A loaded triaxle dump truck at a nearby intersection jumped the curb, crashed through the landscaping and a half dozen other parked cars and landed atop of my dad's new car. It took the insurance company a week to show up to look at the car, which was no doubt a total loss. It was no more than 2ft high and mangled beyond any recognition. Since the car was bought cash, and there was no chance of repair, it was towed home where it sat in the driveway under a tarp to avoid accruing any storage charges at the local tow yard. The insurance adjuster came out, and right away had a bad attitude. He walked around the car and started asking questions as to how it happened, why it happened and why was it parked there. (It was parked in a parking space middle of the row in a public parking lot while he was shopping).
The company adjuster then got out his clip board and made a phone call, he turned to my dad and said they were going to pay him $11,800 for a car he had paid $25k cash for just three days before it got hit. They came up with all sorts of excuses as to why it was only worth that amount and the adjuster, who acted as if the money was coming right out of his own pocket, said that 'Cars depreciate 80% the minute you drive them off the lot', he said he didn't care if it was a day old or ten years old, its a used car and that this is their offer, take it or leave it'. It took 8 months and two lawsuits to get them to pay that claim. It turned out that the company who owned the runaway truck was also insured by the same company, and that the driver was not licensed and apparently not authorized to be driving that truck. 17 other vehicles were damaged in the same incident, including one belonging to a guy down the street, which was a 10 year old pickup truck with high miles, which was insured by a different company, he got paid nearly instantly by his company, and got more than double what my dad was offered for his new car.
In the end, with my dads' car, the insurance company sued the grocery store, they sued the driver of the truck, they even sued the city, they won all three cases and recovered a substantial amount of money but claimed that their costs to do so exceeded their gain. It took a court order to get them to pay.
He had been with that company for years, when it was all done he switched companies. A year had passed after the final settlement and my dad got a bill in the mail from his former insurance company saying he owed them $14,080. (The wrecked car was still sitting in the yard there covered with a tarp waiting for them to come get it). They were claiming that they never recovered the wrecked car and that it had been 'lost'. The letter stated that since they had not been able to sell the remains of the car for salvage my dad was responsible for their 'loss'. They were the one's who inspected the wrecked car in the yard there, yet never bothered to come get it. They had claimed the car was worth only $11k, yet more than a year later they were valuing it at $14k when they realized they had not sold it for salvage. He called his lawyer, who sent them a bill for storage of the wrecked car at $28/day for 512 days. They settled on paying $8k for the storage and never did take the car. I ended up taking it apart and selling it off in pieces 4 years later. The storage money was split between my dad and his attorney.
When it comes to insurance, I see it as a legal requirement, anything more than that is a waste of money. They are in the business to make money not pay out money. Most will pay only what is required by law, and then come up with all sorts of charges, expenses and fees to reduce even that amount.
I could fully see an insurance company deeming a $4k vintage road bike in the same category as a Walmart Huffy, then subtracting for depreciation.