What an agent tells you on the phone or in-person, and what they decide to do when something goes wrong can be entirely different things.
http://www.e90post.com/forums/showthread.php?t=152124
I have heard that Allstate has covered some minor body to damage to cars in BMW CCA events. But if you total it, they might just deny it, and you might end up in court arguing over the gray items such as what constitutes racing, competition, high risk, normal driving situation, etc...