Classic Car Insurance – Why Your “Dream Car” May Be at Risk

It’s possible that you have found your dream car. Perhaps it’s the muscle car you longed for in high school or that car you wanted to drive 30 years ago. Perhaps your classic car has been with you for many years. If you’re currently insuring your classic car with your daily transportation insurance company here are some reasons to consider a collector car insurer.

First, not all standard car insurance companies will insure your classic vehicle for the value it is truly worth. An Actual Cash Value policy may cover classic car owners who have their vehicle covered by their insurance company. This policy is the most expensive. It means that your vehicle will be paid for the actual value it has been determined by the insurance company. If they have blue book values, they may use them or a percentage of the price you paid for it. The $4,000 you paid for the car ten-years ago could be depreciated by the insurance company over the next ten years. Even classic cars and collectibles, vehicles depreciate under Actual Cash Value policies. This policy covers you. The next two types are important.

Classic cars are best served by Agreed and Stated Value policies. Both policies allow for the vehicle’s value to be determined between the owner of the car and the insurance company. This is in addition to a data sheet’s standard value. Agreed Value policies, however, are the best. While Stated Value policies allow vehicles to depreciate each year, they usually have higher deductibles. Because Agreed Valu policies don’t depreciate your classic car is covered up to its maximum amount. Agreed Value policies are the best option because they don’t have deductibles.

Even though I may have scared some classic car owners, there are other benefits to having your car insured through a collector car insurance company. Your premiums could be reduced by up to half. These insurance companies specialize in classic and collector cars. This allows them to keep their premiums down. Car collectors tend to keep their cars in top condition and only drive them a very limited amount. These cars are less of a liability for insurance companies. There are some restrictions that you might encounter, such as a limited mileage allowance (typically 5000 miles per year or less), a minimum driver age limit of 25 or 30, and the prohibition to race the vehicle. You can even have multiple classic cars under one policy!

Your classic car could be worth more than standard insurance companies or books if it is a highly modified or rare car. Collector car insurance companies specialize in collecting cars and know exactly what to look out for when determining the true worth of your collector vehicle. A specialty insurance company can be the best way for your classic car to be fully insured.

Although I won’t be promoting any particular insurance company, a search engine can bring up many more options than you could compare. It is enough to compare only two or three quotes – most collector car insurance rates will be identical. There aren’t often big price swings like in quotes for daily transportation vehicles. Make sure to have an estimate of the car’s value before calling. Insurance companies might want to see receipts from restoration, parts, or labor that you used to determine the car’s value. You may also need to mention any rare items, original parts, and so forth. It may also be mentioned.

After you have established your insurance policy, it is important to update it regularly. The classic car value has increased significantly over the past ten years. A vehicle’s value can also be increased by restoration. In the event of the worst, make sure your vehicle is fully insured. A collector car insurance company can help you get a quote. You may be able to save money on your premiums and your existing insurance may not fully cover your classic car up to its true value. This is a big risk, especially for a classic vehicle.