What is Collector Car Insurance?
Collector car insurance, sometimes called classic car insurance, is specialized car insurance coverage developed for owners of antique or collectible cars. Many owners of collectible cars insure them through standard auto insurance policies, although some experts feel this may cost them as much as 500% more than collector car insurance. Collector car insurance is available at very reasonable rates through many specialty companies, due to the limited use of these vehicles and the low incident of accidents with them.
What vehicles qualify for collector car insurance?
The term collector car may be different between car insurance companies. The industry standard used to be 25 years or older for a car to be considered a classic. However, with car models changing more and more rapidly, many companies look at the type of vehicle and make valuations based on the demand for that particular vehicle. Even newer vehicles with limited production, luxury or exotic cars can be insured under a collector car insurance policy.
What are the types of collector car insurance?
For a collectible car, there are three types of common coverage, based upon the needs of the owner and what type of vehicle is being insured. Coverage options should be considered based on the amount that will be paid if the vehicle is damaged, and not only by the price of the coverage.
Actual cash value (ACV) coverage gives the “book value” of the car in case of an accident. As the book value is based on a standard, this may be more or less than the car is actually worth. For owners who have made expensive modifications or restorations to a collectible car, this may not be the best coverage.
Stated value coverage allows the owner to “state” a value for the vehicle based on work performed and the expected resale value of the car. While this option offers more flexibility than ACV coverage, depreciation is still a factor, as the company will depreciate the value of the vehicle based on the time it has been insured, just as with a new car.
A final type of coverage, and the one most likely to benefit classic car owners, is Agreed Value. Agreed value allows the owner and the company to agree on a value of the car which will not depreciate.
What are some benefits of a collector car insurance policy?
Many things can affect the value of a classic car. While some cars retain their original parts, many have been modified with more expensive components, or made more powerful through engine modifications. Even the name of the restorer can affect the value of one of these vehicles. As a collector car insurance policyholder you can often find coverage to include the cost of these modifications, original parts in the event of an accident and even the choice of an authorized collector car repair shop. Some auto insurance companies even offer guaranteed flatbed towing and insurance for your automobilia.
What are the disadvantages of collector car insurance?
Many collector car insurance policies have restrictions on the number of miles per year a vehicle can be driven. Often, the insurer will not cover a car that is driven more than 2,500 miles in a calendar year. There are also storage requirements by some of the well-known collector car insurance companies such as the Hagerty Insurance Company so if you feel like leaving your 1964 Mustang in your driveway it will be tough to find specialized insurance. Collector insurance policies may also limit the age or type of driver allowed to operate the vehicle with many policies requiring drivers to be at least 25 years of age, and some have limits of 30 years.
Many of the same discounts available to drivers of non-classic cars are available on collector policies. If you insure multiple vehicles, for example, you may be eligible for a discount. Further, many collector policies will allow you to pay a single liability premium for all of your insured cars, and a collision or damage premium for each individual vehicle. This can save you significant money over a regular policy.
What car insurance companies offer Collector Car Insurance?
There are several car insurance companies that specialize in collector car insurance. Hagerty Insurance is one of the leading insurers of classic vehicles, well-thought-of in collector car circles for their low rates and flexible policies. American Collectors Insurance and American Hobbyist Insurance also offer special collector policies. American Hobbyist offers a 2% per year inflation increase for the value of your car if you have agreed value coverage, and American Collectors offers street rod as well as classic motorcycle insurance. Leland-West specializes in first-time buyers and limits their coverage to hobbyists and limited-use vehicles. You can also obtain insurance through specialty clubs such as Classic Collectors, which offer premium plans through independent insurance agencies.
When comparing car insurance quotes always make sure to receive identical coverage in each quote. With a classic car policy, there will be different restrictions and requirements and it’s important to understand what the policy is stating so that there are no misunderstandings. Things to check for include mileage restrictions, storage requirements, driver restrictions, replacement value formula, restrictions on use and more. Never take the first quote and make sure to speak with companies who have a high quality reputation.