WEDNESDAY, AUGUST 8, 2012
Many consumers may be surprised to know that insuring a classic car is not just another auto policy. Insuring classic and specialty cars depends entirely on how the owner intends to use the car. Before you sign on the dotted line, it’s important to ask your agent these important questions:
 Can I use my own mechanic for repairs?
Is the car insured for what it’s actually worth?
Am I covered for liability while at club events or car shows?
Am I covered during restoration?
Do I have flexible premiums based on miles driven per year?
Standard car insurance generally covers a classic car as it would any other car, which means it may not provide full coverage on the specifics that classic cars require. It may be worth it to get a few quotes for specialty collector car insurance. In order to qualify for specialty collector car insurance, the owner must own and use a daily driver vehicle, the car must meet specific guidelines and only be used for certain activities, never commercial use and less than 2,500 miles per year.
While it may take some extra time and research to seek out and consult with a company that offers specialty car insurance, it may end up saving collectors a decent chunk of change. Roughly half of classic car owners put their collectible vehicles on a standard auto insurance policy without realizing that they could be paying too much for inadequate coverage.
Generally, auto insurance coverage is based off of Actual Cash Value (ACV), which pays out a depreciated blue book value on your vehicles. Regular auto insurance always takes into account depreciation over time, but with classic cars, they may actually appreciate in value. Companies providing specialty insurance also offer policies based on Stated Value, and Agreed Value. Stated Value policies allow you to 'state' a value for your vehicle that is greater than its depreciated 'book' value, but once you state the value that is the most the insurance company will pay. Only Agreed Value insurance policies guarantee you will get all of your money back in the event of a total loss.
Auto insurance on collector’s cars, even specialty insurance is often cheaper than a standard auto policy because insurers know that collector cars are pampered by their owners. Generally an insurance company will decrease their rates by about 20% if they know the car is a collector and is driven mainly to show it off.
Navigating through insurance options for your classic car is a juggling act between finding the right insurer and the right policy based on the type of car you have and how (or whether) you drive it. When insuring your classic baby, owners should dig deep and research all options before making a final decision. Cost should be considered, but should not be the determining factor. Also take into account quality customer service, claims handling and a knowledgeable staff who understand and appreciate collector vehicles.
By Matt Reynolds - Google+
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