A begginers guide to Classic Car Insurance Policies
If you have not owned a classic car before it is important to realise that there are basic differences between what is known as a standard car insurance policy and the cover offered under one defined as classic car insurance, from a specialist car insurer.
Can you be covered under a Classic Car Policy?
One way you could do this is ask the previous owner whether it was covered under a classic car insurance policy and with which insurance company.
What might be easily covered with one provider may be excluded by another. Fortunately most online classic car cover providers provide this information on the first page of their websites, so it is fairly easy to surf around and check your eligibility with different insurance companies.
You should check that both the eligibility of the age of the car in question and also whether there are policy restrictions for your individual driving circumstances, such as your age that would prevent you from applying for cover.
The large mainstream insurers and price comparison sites will offer cover for older cars but will charge an additional premium because of its age.
More importantly you will only be offered the current market value replacement if the car is covered under a mainstream policy and is deemed to be a write-off when you claim.
With a standard car insurance policy on a replacement like for like basis, the value of the car is often set by the market value at the time of a claim, typically taken from one of the car price magazines such as the UK’s Glasses Guide.
The amount you will be probably receive for a write-off will be at the current market value of your car which is an annual depreciating amount. Inevitably, if you own a classic car and insure it under a standard policy contract, this leads to under valuation and under insurance of the true value of the car.
The lifestyle factor is more predominant in the calculation and issuing of policies for classic cars than in any other form of specialist motor underwriting.
Classic car insurance policies are now based primarily upon usage limits and consequently tend to reflect the fact that classic cars are used differently than a normal everyday car, although the all types of use will still apply.
Classic Car Usage
1. social, domestic, pleasure
2. business and commuting
3. for hire and racing
Many a beloved classic motor will stay under wraps in the garage for many a month and is only brought out and paraded for special occasions and events.
The range, length and risk of these events will undoubtedly determine the level of price for a specialist classic car policy. Such events can be as innocuous as local classic car club meetings at predetermined destinations, fun runs, treasure hunts, vintage runs, air shows and displays, national classic rallies, film shoots, motor shows, trade shows or as extreme and heavy premium carrying as classic car racing or hill climbing.
Most specialist motor underwriters therefore appreciate that you may need a more tailored and flexible type of car insurance for a classic car, one that allows you to fit the policy around what is effectively your lifestyle risk. Your risk levels are calculated upon the way you use the classic car and the number of miles distance you cover in that car each year.
These so called rating factors are adapted to play a much larger role in the calculation of a classic car insurance premium than the traditional factors that weigh heavily in standard car insurance premium calculation, such as Age or Gender.
Price has tended in the past not to be a large driver in the classic car insurance market, where quality of cover for cherished vehicles has always been seen as the primary marketing message. Underwriters have appreciated that the classic car is quite often considered as a ‘baby’ within the family unit and may in the past have taken advantage of the irrationality when considering price.
It is now possible to obtain tailored online cover for even the most obscure car marque and the introduction of online underwriting has introduced a welcome level of competition into what had become a stagnant market. Group and affinity market buying power has also helped stimulate growth and push premium prices down through bulk buying power schemes. Whatever aspirations you may hold as a classic car owner it appears that with technology you are more increasingly likely to be judged financially by your lifestyle than its trappings that you must insure.
The Internet has made it very easy to compare Classic Car Insurance that was previously only available from specialist car insurance brokers on the high street.
You can find car insurers offering special deals for your particular classic by searching for your model type e.g American classic car insurance.
