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If you are contemplating
purchasing or already own a classic car, collector car or hot rod, you
no doubt want to make sure you have it correctly insured. Large amounts
of time and money have inevitably been invested in the car of your dreams
and it only makes sense to protect that investment by insuring the car
for it's real value. |
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| You might also be one of
those folks who have had a vehicle passed down through the family or have
owned it for many years yourself. Thinking the vehicle is only worth
what was originally paid at purchase minus depreciation might lead you
to also think perhaps it is not even worth insuring since it is rarely,
if ever, driven. In reality the value of that vehicle may be higher
than you think and may be worth protecting against the unthinkable, especially
if you can do so at a reasonable price. Nor should you just assume the
car would be covered by your property owner's insurance without checking
and verifying. |
| I am simply a consumer like
you and believe me I am no insurance expert, just knowledgeable enough
to know I sleep a little better when my classic vehicles are properly insured.
I have also learned over the course of time that many people have a natural
tendency to think of insurance for their classic in the same terms as standard
insurance for their everyday driver. Often coming to the conclusion that
insuring the vehicle may not be worth the cost. My experience is
that this isn't necessarily true. |
| Many people are unaware
there are companies who specialize solely in insuring classic cars, collector
cars and hot rods. You will find after a little research that these
companies can offer quite a bang for your buck at a very reasonable price,
so you probably want to investigate your options thoroughly before making
any final decisions. Again, I'm no expert but I will be happy to
pass on what limited information I have to help get you started if this
is all news to you. |
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Specialty insurance
is designed not only for car collectors but also hobbyists and often combines
significant benefits and enhancements tailored to the needs of those owners.
These are benefits largely unavailable with a standard insurance policy
but you will find also that the qualifying requirements for specialty policies
can be different too. Said simply one is designed for one thing and
one for another. The first thing to consider is your specific needs
versus the best match.
Three different types
of Specialty Auto Insurance available:
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Actual Cash Value Insurance
This is the policy you are most
likely carrying on your daily driver and the one with which you are most
familiar. These policies incorporate a depreciated book value if/when
a claim is made, reflecting the traditional fact that under normal circumstances
a vehicle's value is going down as the car ages. Often your records
of work performed on your classic car can help in settling claims to your
satisfaction if you insure the car through a traditional insurance policy.
For certain applications this
is a better fit than Actual Cash Value, because it allows you to “state”
a value for your vehicle and the carrier agrees to pay up to that amount.
The insurance company may require an appraisal, copies of records of the
money spent restoring the vehicle or an inspection before agreeing to provide
insurance coverage.
With this policy you will receive
a guarantee to get all of your money back in the event of a total loss.
In some cases this type of policy will incorporate a feature that automatically
allows for a continuing increase in the value of your vehicle. Again
the insurance company may require documentation and or an inspection. |
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| I previously mentioned specific
requirements the first of which is going to involve the type of vehicle
you want to insure. There seems to be an expansive list of vehicles
that can potentially qualify for specialty coverage. This ranges
from classics, hot rods and customs to even new, but rare, exotic and sports
cars. A rule of thumb standard has been that vehicles 25 years and
older will usually qualify, however there are exceptions to that and if
specialty insurance is what you think you're looking for then you should
inquire and shop around. Chances are there's an insurance policy
for you. |
| Next you should consider
the parameters that might be required in order to buy or maintain specialty
coverage car insurance. Typically you will find there are mileage
restrictions limiting the annual use of the vehicle, usually in the range
of 2,000 to 2,500 miles per year. Then there will probably be a requirement
that a person has a regular car or cars that are driven daily helping substantiate
that the collectible vehicle will only be driven on a limited basis.
Some policies will place restrictions on the reason a vehicle is being
driven as in shows, parades etc., while some policies are more flexible.
However you can be sure that all of these insurance policies will restrict
you to no daily transportation or racing applications. |
| Where and under what circumstances
a vehicle is kept while not being driven will be of concern to the insurer
so be prepared to answer those questions. There will probably
be some minimum requirements of the driver in order to insure. Most
commonly a minimum number of years of driving experience, a good driving
record and a minimum age. |
| Finally be prepared to send
pictures of your vehicle to help substantiate the value for which you are
requesting coverage. The insurance company may require an appraisal,
any documents you have verifying the restoration costs and in some cases
an inspection of the car by their own appraiser or adjuster to verify the
vehicle's condition. |
| All this may sound a little
restrictive but if you assess what you actually use the vehicle for you
will often find, as I did, the requirements allow you sufficient latitude
for your specific application and the positives far outweigh any negatives.
If like me, your collection becomes larger over time you will find your
specialty insurer recognizes you can't be driving all the cars at the same
time and will pass along a volume discount to reflect that. |
| Bottom line is it's worth
a little research. There are a number of reputable companies out
there offering specialty car insurance. Check them out, you might
be surprised how much money you will save and feel far more comfortable
about what will happen if the worst were to ever occur. Let's be
honest, it would be bad enough to “lose” your car for any reason. It would
add insult to injury if your claim resulted in significantly less than
the true value of the vehicle. The final discovery that with specialty
insurance you would have realized full value (for an increment of the premium
you had been paying) could send you right over the edge! |
