If your passion for classic design extends beyond your old home’s architecture, then perhaps you have a beautiful piece of history sitting in your garage.
Like a well-tended historic home, a vintage car’s value increases with age, which means you’ll need to buy special car insurance to give you the financial protection your car deserves.
New cars lose value the minute you drive them off the dealer’s car lot — and they continue to depreciate as they age. That’s why standard car insurance policies generally offering you the “actual cash value” (which takes depreciation into account) for your car if it’s totaled.
With a classic car, you want a policy that provides “agreed value.” In essence, you and your car insurance company agree upon the value of your car at renewal time and that’s the amount your will be paid in the unfortunate event that your prized car is totaled.
How do you put a price on a collector’s item?
A variety of resource guides and pricing books, such as the “Old Cars Price Guide” or the “NADA Guides,” provide good estimates that satisfy most classic car insurance companies if your car is a stock original vehicle, which means you haven’t done any work on it or added new features. You may need to hire an appraiser, though, if you’ve restored or modified your car and increased its value. Keep detailed records and receipts of the work you perform if you’re restoring a car or building a street rod.
When you compare auto insurance quotes, check if the policy offers automatic increases of coverage each year to account for appreciation. If it doesn’t, then review your policy and your car’s value every year to make sure you have enough coverage.
Beware that classic car insurance has restrictions. You may not qualify unless you have a relatively clean driving record — and you must not drive the vintage car for purposes other than pleasure. Some policies put a cap on annual mileage and require proof that you have another car for daily transportation. You might also be required to keep your car in a locked garage and maybe even install an alarm or sprinkler system to protect it against theft and fire.
To buy specialized auto coverage, your car must qualify as classic. That used to mean cars 25 years or older, but today some cars 15 years or older might be considered “modern classics.”
Classic car insurance prices are less expensive than standard car insurance rates due to all the restrictions. The insurer assumes you’re not going to drive the car that much, and that when you do take it for a spin, you’re going to be awfully careful. The liability portion of your coverage might cost as little as $100. Collision and comprehensive will run about 1 percent of the car’s total value. Of course prices vary according to where you live, the insurance company, how often you drive the car and where you store it.
When you compare car insurance quotes, make sure you compare similar coverage options, so you get the best value, not just the best price.