Insurance for Classic or Collector Cars

If you have already found the car of your dreams, congratulations! Now you will want to protect your investment, so you will need classic car insurance. The first step is to determine your particular needs for insurance. This will vary greatly, based on your financial situation, the car in question, and your tolerance for loss. Specialty insurance is necessary for a classic car, collector car, or hot rod, so don't think that you will be able to call your usual run of the mill auto insurance company for a quote. The regular auto insurance companies base their policies on book value of the car, which is nowhere near street value for a classic or collector car. Consider this: if your car is 40 years old, it may only show a book value of $500, whereas real collector value may be more like $50,000! Typically, the collector car insurance policy will be based on stated value, not book value, so you will need to come to an agreement with the insurance agent on the true resale, or street value, of the car. This is done with the help of a classic car inspection and appraisal (more on this subject here).

Collector car insurance policies can be bought for collector cars, classic cars, hot rods, rare cars, or practically any car that does not sell for 'book value', so it is an important consideration if you own any of these types of cars. A collector car insurance policy requires the insurance agency to cover loss or damage up to a stated amount, so you will need to review the policy annually to account for changes in value of the car.  Additionally, optional riders can be added to include things such as damage that occurs at a car show, fire, theft, or for road hazard to cover driving a certain number of miles per year. You will need to spend considerable time with your agent to ensure you get exactly the coverage you desire.

Once you have decided what type of coverage you need, you will  need to provide some additional information, such as proof of ownership of a daily driver vehicle. This type of insurance policy will not cover a classic car or collector car that is used for everyday transportation, since the risk of theft and accidents is much higher than if the car were a 'garage queen'. If you plan on buying a classic car to drive around everyday, you will need to get traditional auto insurance, or find a company that can insure your vehicle based on stated value. You will also typically need to provide an appraisal from a classic car, collector car, or hot rod appraisor, to ensure your 'stated value' is actually fair market value. This also ensures the car is being insured properly, as modified cars need different insurance than restored classics. You will also need to show proof that is has been inspected by a classic car inspector, which can provide information regarding the condition of the car. Finally, you will need a clear title for the car, which matches the VIN number and proves ownership and that there are no liens against the car.

Once you have met these requirements, you can begin shopping around for an agency that meets your needs. There are a variety of insurance agents out there that offer these services, even though many of them do not advertise these options, since it is a rather niche market. The best place to start is by calling your traditional auto insurance company to see if they offer such coverage. In many cases, they may not offer it, however the agent may be able to recommend a partner company with which they are affiliated. This can help find a company quickly. Another great way to find an insurance agent that specializes in collector car insurance is to ask friends at a collector car club, or to visit a classic car show to see if any of the vendors offer this type of policy.