JUL 31, 2013

Insuring Your Classic Car

When it comes to insuring your classic or vintage car it pays to do your research. Most insurance companies will offer you a quote to cover your car but often they base their premiums on the car being used daily for commuting and running errands etc, whereas a classic car more often than not tends to be used sparingly on weekends and special occasions.

Many insurers that provide insurance for modern cars have a flowchart of questions and answer that they work from. Their quotation process is usually based on a series of algorithms. The consumer is asked questions and their answers to these questions determine their risk factor and calculate a quote. There’s often not much room for deviation from the set flowchart questions to cater for slightly abnormal individual circumstances.

As a result of this system it is often the case that mainstream insurers will provide classic car owners with incredibly high quotes. It is far better to do your research and approach insurance companies that specifically deal with providing cover for classic cars.

An insurance policy designed specifically for a classic car will often have much cheaper premiums than mainstream insurers but it is usually a bit more restrictive. Most classic car insurance policies will have a maximum annual mileage limit, usually up to 3000 miles, as these types of vehicle are often not driven very often anyway.

One of the main benefits of choosing an insurer that specialises in classic cars is the agreed value clause. This clause guarantees the amount that would be paid out to you in the event that your vehicle is written off in an accident or stolen. Mainstream insurers work with the current market value of a vehicle in order to determine how much to pay out. However it is notoriously difficult to determine the market value for a classic car so you may lose out with a mainstream insurer.

An agreed value policy is more suitable for classic and vintage cars because the insurance company will take into account the condition of the vehicle as well as its ‘collectable’ value. The agreed value will be reviewed over time so it’s important to discuss with your insurance company how often they review it and make sure that the agreed value is guaranteed for a predefined period of time.

Classic car insurance providers will often stipulate several other terms to accompany the low premium including where you can and can’t store your vehicle, i.e. in a locked garage rather than parked on the roadside or even a driveway. If you intend to take your classic car to motor shows you’ll need to let your insurer know as this type of use is not always covered as standard. In addition to all of this, your insurer may stipulate where you can and can’t get your vehicle repaired and serviced.

If you’re more than happy to comply with the guidelines and restrictions placed upon you by a classic car insurer then this type of insurance will be perfect for you as it’s much cheaper and pays off better if you need to claim. However, if you feel you can’t comply with the strict guidelines or you want to drive your vehicle for more than 3000 miles per year then you may be best off with a mainstream insurer; your cover will be more comprehensive but you may lose out if you have to claim on it.

Created on 31st July 2013
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