Jim,

Its called substitution of collateral. The laws are slightly different from state to state but in most cases its an option. When you start demanding they find you a suitable replacement they want to avoid that option at all costs especially with a hard to find car.

Additionally fair market value is not the figure they will try to give you. Most insurance companies start at wholesale and then move up to trade in value when you start talking real numbers. It will take a lot of fighting to even get a low fair market value let alone what the car's really worth.