Collecting and restoring vintage cars is a fun hobby, and even an investment, for many. But if you hit the road with your old set of wheels, you need more than just a popular car insurance policy to protect you.
Here’s a guide to insuring your old car.
Classic car insurance especially protects your classic, antique, exotic, or rare vehicle. It works in the same way as a regular car insurance policy, offering a liability policy, medical bills to others involved in an accident, and property damage. But it also includes special policy features that help you calculate the price of your car without having to spend a lot of money.
“If you rarely drive your old car, antique car insurance could be a cheaper way to insure your assets than popular coverage,” says Cassie Sheets, a specialist journalist at Insurify.
Standard car insurance only protects your car up to its real money price. If you damage your car, your insurer will reimburse you for the price of your car at the time of the incident. Therefore, until you file a total loss claim, you won’t know how much you will be compensated for your car, and in most cases it will be much less than what you paid.
Classic car insurance uses the agreed-upon price method. This sets the price of the car at the time the policy is drafted and is reassessed on the policy’s anniversary.
“The agreed price is tailored in particular to your car: what condition it is in, how many kilometers it has traveled, the history of the vehicle, everything related to it and its price. Everything is customized so you know exactly what you’re getting for a total loss. , as opposed to the real-money price,” says Bryant Kolle, regional vice president at Hagerty, a provider of vintage auto insurance and an organization of car enthusiasts.
Classic car insurance companies use various criteria to define a classic car. Age and how often it’s driven are two primary factors, but the type of vehicle and its condition may be evaluated too.
American Collectors Insurance, for example, offers antique car insurance for cars that are at least 25 years old and in good working order. Vintage farm tractors, military cars and vintage hot rods are eligible.
Many antique car insurance companies consider antique cars to be collector’s items and not everyday drivers.
“Traditional or collector’s insurance is more complicated to download than general auto coverage — you have to have certain documents and pictures to give to the carrier,” says Michael Silverman, founder and president of Silver Lining Insurance, an insurance agency. independent in New York.
Policyholders may need to meet mileage limits and/or prove they have another car to use on business or other trips, for example. Sometimes they also can’t use the old car for high-risk activities like racing or off-road and will have to have a smart driving record.
Conventional car insurance uses an agreed pricing policy from a real-money pricing policy.
If you have car insurance and your car suffers a total, your insurer determines the price of the car (its real-money price) at the time of the accident. You get this amount, minus any deductible you owe.
The actual financial price of a new car will likely be much lower than the original purchase price, as the price of a typical car tends to decrease with each mile driven. The average price of a vehicle between two and six years old dropped by about 20% in 2023, according to data from Black Book and Fitch Ratings. In other words, a car you bought for $30,000 might be priced at just $24,000 a year later.
On the contrary, older cars tend to maintain or increase their price, so insurers negotiate their price with the car owner without considering depreciation. In the event of a global claim, the insurer reimburses the agreed price of the car (less the excess). Since depreciation does not exist in traditional auto insurance, it can result in a higher insurance payment.
Quick tip: If you make significant innovations or adjustments to your old car after you’ve purchased your policy, ask for a new appraisal so that what was agreed reflects the innovations.
Classic car insurance covers the repair and replacement of the vehicle up to the policy limit for inclement weather, falling objects, theft, vandalism, etc. (full coverage).
It also covers repair and replacement up to your policy limit in the event of damage to the vehicle or object, regardless of fault (collision coverage).
The liability policy is mandatory by law for all cars and covers damage caused by the driver to other cars and property, as well as personal injury. Minimum auto insurance policy limits vary by state.
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There are a number of additional coverages available for antique car insurance policies that cover urgent issues or cases faced by antique car owners.
Replacement portion coverage, for example, can provide up to $500 or more to update portions you don’t use. Covering memorabilia can increase the price of antique plaques and other heirlooms.
Some insurers offer inflation coverage at no extra charge (a valuable benefit since most older car models increase in price over time) and give owners the right to keep their broken vehicle if it is destroyed.
Conventional auto insurance is less expensive than a popular policy, largely because you drive your vehicle less often, reducing your risk of getting into an accident.
However, conventional car insurance policies can be more expensive than insurance policies if you own an exceptionally rare vehicle. In this case, the agreed-upon price (i. e. , your policy limit) will be higher, which will increase your premium.
Companies that offer vintage car insurance employ specialists capable of responding to requests for repair or replacement of a unique or rare vehicle.
“The claims adjusters who handle those claims have a thorough understanding of the vintage car market and the repossession processes. They work intensively with the owners to make sure the vehicle is restored to its pre-loss condition, with original parts and skilled labor,” says injured Barry Goldberg. and twists of fate attorney in the Los Angeles area.
Search for data on the insurance company’s monetary stability in a database such as AM Best. A smart credit score indicates that the company is accustomed to paying its customers’ claims temporarily and efficiently.
Also, take a look at visitor reviews, sites like ConsumerAffairs, and the Better Business Bureau. By reading those testimonials firsthand, you’ll get a smart idea of how the company handles the claims procedure and general policy issues.
You may want to find antique car insurance through your number one auto insurance provider. Major national brands, such as State Farm and Safeco, offer antique auto insurance as well as popular policies. Some of the top specialty providers include American Collectors Insurance, American Moderno, and Hagerty.
Your policy limits are adjusted to your usage and the condition of the car. For example, if you plan to drive your vintage car every weekend, a policy with mileage limits, such as 5,000 miles per year, probably wouldn’t be a good option. adapt.
Also your deductible options, adding the amount and whether it applies annually or per incident. This is the amount you’ll have to pay out of pocket before your insurance kicks in.
Also compare a company’s additional or complementary coverage, such as towing or roadside assistance.
Car insurance premiums are sometimes lower for older cars than for daily drivers. This is because the risk of theft and injury decreases as you drive less and (ideally) store your vehicle in a secure location when you are not on the road.
However, your annual mileage is likely your premium, in addition to the agreed-upon price of your older vehicle, your deductible, policy limits, and certain fringe benefits. Personal factors, such as your age, credit history, and where you live, also play a role. Living in an area with high crime, for example, will typically result in a higher premium.
One of the most important points in pricing premiums is your driving record. If you have had one or more at-fault tickets or injuries that resulted in an insurance claim in the last 3 years, you will most likely pay more.
If you use an insurer that offers other lines of coverage, such as home insurance, you may be able to save on premiums by bundling your policies. However, as a general rule, corporations that concentrate solely on vintage auto insurance will offer more advantageous policy options.
You may also get discounts if you haven’t had a price ticket or a recent accident.
The average annual cost of auto insurance in the United States exceeds $1,000 and continues to rise. The cost of antique car insurance depends on the condition of the car, its market value, and your driving record, among other things, but it is unlikely to exceed the charge of insuring a popular driver.
Baily Insurance, which offers antique auto policies in Pennsylvania, Ohio, West Virginia, and Maryland, reports that a typical insurance policy can charge anywhere from $200 to $600 per year. This reflects the lower risk of insuring a vehicle that is driven safely. although only occasionally and very well maintained.
The procedure for filing an insurance claim varies by provider, but follow those steps:
Immediately after the incident, take pictures of all visual damage to your vintage car. You will need to describe, in writing or over the phone, exactly what happened and when. You may want to provide a copy of any police reports that corroborate your story.
Classic cars require more common maintenance than newer cars. Anyone who owns a collectible probably takes great care to keep it in good working order, which may include checking the brakes, examining the tires, replacing the battery, washing and detailing it normally, and replacing the fluids. .
It’s more productive to leave your car in a covered, locked garage rather than parking it on the street or on an exposed driveway because it stands up to bad weather and theft.
Many vintage car insurance companies have basic garage criteria that you will need to meet to qualify for the policy. Make sure you meet the provider’s specifications before signing your insurance contract, or your policy may not be valid.
Classic car insurance offers car enthusiasts an affordable policy for a valuable asset.
“Special insurance policies cater to owners by protecting the price of the vehicle, making sure maintenance is done with the right parts, and providing customized endorsements that take into account the specific use of the vehicle,” Kolle says.
If you own an older car that you plan to put back into service, you may not yet be eligible for a comprehensive auto insurance policy. Consider taking out partial insurance first, as some insurers don’t insure cars in poor condition.
If you plan to drive your vintage car regularly, you may want to find an insurer with no limitations or annual mileage.
The Better Business Bureau, ConsumerAffairs, and Trustpilot are smart internet sites for checking visitor reviews of vintage car insurance companies (not all providers have a profile on each and every platform).
These are the average visitor ratings of some vintage car insurance in July 2024:
Most visitor reviews of traditional auto insurance companies detail personal claims experiences, quick visitor service interactions, or how easy (or difficult) it is to get coverage.
Keep in mind that any negative or positive narrative about working with a specific insurer should be a starting point for your own research.
Whether you drive short distances with your vintage car on weekends or drive it to car shows several times a year, antique car insurance is a wonderful way to protect your wallet. For a low monthly cost, you can get assistance paying for your vehicle maintenance caused by adverse weather conditions, theft, vandalism, and accidents.
Remember, the traditional auto policy is not intended for high-use vehicles. Sometimes it is designed to protect the price of older cars that are conscientiously maintained and stored and are on the road as little as possible.
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