Owning a classic car is about more than transportation; it’s about preserving a piece of history. Because of this, insuring these vehicles requires more than standard auto coverage. It calls for specialized coverage that addresses their unique value and risks.
What is classic car insurance?
Classic car insurance is a necessity for anyone who owns vintage, antique or collector cars. Unlike standard auto insurance, classic car insurance is tailored specifically for the unique risks, high values and infrequent use of collector cars. It’s specialized auto coverage that’s designed to address issues that regular policies often overlook, such as challenges with finding replacement parts and the vehicle’s true value.
One of the standout features of classic car insurance is the agreed value coverage. A typical auto insurance policy uses actual cash value (ACV) to determine the claim payout in the event of a loss. This value is determined by an insurance adjuster, who takes into account the car’s condition and its value on the current auto market, which is often determined by pulling estimates of similar cars.
On the other hand, classic car insurance policies typically provide an agreed value based on true replacement costs. This means that in the unfortunate event of theft or damage, you’ll be compensated for the full agreed value of your classic car. This agreed value is mutually determined by you and your insurer and may take into account the vehicle’s condition, value, cost of replacement, improvements made and cost of specialized parts. Oftentimes, this number is higher than the actual cash value of the vehicle and is more representative of the car’s true worth.
Why You Need Specialized Insurance for Classic Cars
Antique and classic cars are pieces of history and often appreciate in value over time. This appreciation, along with their rarity, value and historical significance, makes it essential to have specialized insurance coverage that may not be found in a standard auto policy. For instance, a typical policy might not cover the cost of restoring a vintage automobile to its original condition, but this coverage might be available as part of a more specialized classic car policy.
Eligibility for Classic Car Insurance
Generally, to be eligible for classic car insurance, your vehicle must be at least 25 years old and in good mechanical condition. This could include various vehicles, ranging from classic motorcycles to antique farm equipment.
It also cannot be your primary or daily vehicle. If you primarily use your classic car for transportation, rather than pleasure, you can still secure an auto insurance policy that’s designed for higher-value cars.
Another crucial requirement is secure storage. Classic cars must be stored securely when not in use, typically in a private and enclosed garage. This helps to protect the vehicle from theft, vandalism and environmental damage.
Key Coverages in Classic Car Insurance Policies
Classic car insurance can offer a range of coverages to help protect your valuable investment. In addition to standard personal auto coverages, like liability, bodily injury, uninsured motorist, collision, physical damage and personal injury protection, it may include:
- Agreed Value Coverage: This helps to ensure your vehicle is covered for its full agreed value in the event of theft or damage, which is essential given that classic cars often appreciate in value and cannot be easily replaced. Standard auto policies typically use actual cash value, which adjusts your claims payout based on the car’s current market value, regardless of what you originally paid for it.
- Spare Parts Coverage: This coverage is particularly important for classic car owners who may need to source rare and expensive Original Equipment Manufacturer (OEM) or fabricated parts for maintenance and restoration. While these parts are needed to maintain the integrity of your car, they may not be covered by a standard auto policy.
- Automobilia: If you have collectible items on your vehicle, such as a classic hood ornament or antique license plate, you may be able to insure them as part of your classic car policy.
- Car Shows: If you primarily use your classic car for car shows and auto club meet-ups, you may be able to add coverage for risks associated with these events, such as show medical reimbursement coverage (if an attendee sustains an injury at an event featuring your car) or no attendance display coverage (if your vehicle is being displayed and you aren’t present).
Factors Influencing Classic Car Insurance Premiums
Several factors influence the premiums for classic car insurance, making it essential to understand what affects your rates.
- Infrequent Use: Since classic cars are often driven less frequently and solely for pleasure, these autos have a lower risk of getting into an accident. Insurance providers often impose low mileage limits on classic autos to minimize risk.
- Car Value: Just like with a standard auto policy, your premium amount will be impacted by your classic auto’s age, model and condition.
- Mileage Tiers: Some insurers may offer tiered mileage plans, allowing you to choose the plan that best fits your driving habits and potentially reducing your premium costs.
- Repair Costs: If a classic car does become damaged due to a covered incident, repair or replacement costs could be much higher than those of a standard auto due to the need for highly specialized parts and labor.
- Driving Record: Just like with a standard auto policy, having a clean driving record can help lower premiums. But, for classic car policies, a clean driving record may be required in order to secure coverage.
- Car Storage: Classic auto policies may require that the car be securely stored when not in use. But, going beyond policy requirements could allow you to save on premiums. For example, storing your vehicle in a climate-controlled garage may help lower your premium, since this can reduce the risk of damage and deterioration.
- Bundling Policies: Consider bundling classic car insurance with other policies, such as homeowners’ or boat insurance. Insurers may offer multi-policy discounts, which can help to lower your overall insurance costs.
Protect Your Classic Car Today
Choosing the right classic car insurance policy involves comparing quotes, bundling policies and considering tiered mileage plans. Higginbotham can make the process easier by securing quotes from multiple insurance carriers and offering insights into different coverage types.
Your classic car is an investment, and it deserves to be protected. Talk to a classic car insurance specialist to learn how Higginbotham can help you secure coverage for your classic auto.
