Most types of car insurance cover vehicles that deteriorate in value over time. Classic car insurance does just the opposite. It is designed to keep pace with the car’s increasing value and to protect what most owner/collector’s consider an investment. The bonus to classic car insurance is that it usually costs less, even though it offers higher coverage. Why? Owners of classic cars tend to pamper and care for these vehicles, house them properly, and keep the mileage down. Premiums average 20-40 percent less than a regular policy.
However much you may love your prized baby, not all old cars qualify as CLASSIC for insurance purposes. The first test is whether the car’s value exceeds its original selling price. Some that may qualify would include:
- Exotic and luxury autos
- Muscle cars
- Classic trucks
- Hotrods and modified vehicles
- Antique and classic cars, usually at least 25-30 years old that is not of a high production run.
- Classic motorcycles, antique tractors and vintage military vehicles
What is Required for a Classic Car Policy?
Many insurers won’t cover a vehicle in poor condition or has had significant damage and since the car’s age is not enough for specialized classic car insurance, look at the following qualifications used by many insurance companies.
- Limited use – Your classic car cannot be used for everyday commuting or errands, and your policy may include mileage limitations and proof the car is being properly garaged if you do travel with it. You may be required to use your primary auto for regular driving to and from work and other destinations.
- Car shows and meetings – The limited use provision of a classic car policy allows for travel to car shows and auto club meet-ups; however, this coverage may be restricted by some insurers. If this is the case, there are insurers that can provide specialized coverage for car shows and meetings. Before choosing a classic car insurer, it’s worth checking whether they have travel restrictions if you plan to take your car on regular, multi-day, high mileage drives.
- Secure storage – When not in use, your special vehicle must be stored in a locked, enclosed, private structure, such as a residential garage or storage unit.
- A clean driving record – You may be disqualified from classic auto insurance if you have serious offenses on your driving record, such as reckless driving, repeat speeding violations or driving while intoxicated. Often no more than one at-fault accident or moving violation with the previous three years is used as a requirement.
- Driving experience – five to ten years of driving experience with a good driving record is anticipated.
- Racing – You must agree not to race your classic care or drive it on a race track.
What’s Included in a Classic Car Policy?
Car Value: Unlike current vehicles there is no firm book value for specific classic makes and models. First, discuss with your insurance agent and reach an agreement on the value. Your policy will reflect that value providing coverage up to that amount without depreciation. Often collectible car valuation guides such as the Old Cars Report Price Guide is utilized. Other times an appraisal by a professional valuator or research provided by an agent will guide the agreed value.
Special towing and spare parts: Transporting a classic car often demands special care such as a flatbed tow truck rather than a winch. Often this service is more expensive. Cost of replacing (even locating) spare parts must be by current replacement value. Some components will be difficult to locate requiring you to do your best to negotiate but without much competition, the parts usually remain high.
Expert repair or restoration: Labor rates can be two to three times more expensive for qualified mechanics who work on classic cars. Your policy needs to reflect this increase and not the average cost at a typical repair at a traditional auto body shop.
If you have a classic car, contact your insurance agent to discuss the correct policy. Protect your cherished investment and ensure many years of fun motoring.
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