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Classic Auto Insurance - A Brief Guide

By: Colin Cherry

You have probably invested a lot of time,money and effort in your classic car, but have you invested in proper classic auto insurance?

When it comes to classic auto insurance, the underwriting is different from that used when insuring your more usual family car. If you want to protect your classic auto investment then it is vitally important that you insure with an insurance company that specializes in classic auto insurance.

Having said that, there a few things to bear in mind when looking for the best classic auto insurance quotes.

Firstly, garaging is important. Most insurance companies will insist that your classic auto is kept in a locked garage or parking area when it is not being driven. Also it has been known for some insurers to deny a claim when the vehicle has been left unattended in a car park or parking lot. This even extends to when and if you take your car on holiday. Parking in the hotel's lot may void any claims.

Secondly, most specialist classic auto insurers offer a choice of valuation methods, the most common being - a)The Agreed Valuation Method. Here both the insurer and the insured agree a fair market value for the vehicle that is reviewed each year upon policy renewal. This is considered to be the fairest valuation method, but remember that unlike the usual family vehicle, classic cars can increase in value. This will be of course be reflected by a proportionate rise in premium. b) The Actual Cash Value Method. With this method, the insurer will only pay out the current market value for the car. The problem with this is that the current market value means the original price of the car when it was brand new less depreciation. Lets say you have an e-type Jaguar that would of cost (for the sake of argument) $2000 in 1968. Today after depreciation the market value used by insurers would be (again for the sake of argument) $300 and this is all you would get if you made a claim. c)The Stated Amount Method. This method involves the insurer setting the maximum amount that they would pay in the event of a claim. But this maximum amount would be the lesser of either the amount to repair the vehicle, the stated amount or the actual cash value. Once again this method does not take into account the true value of your classic auto and so should be avoided.

Thirdly, how you use your classic auto can have a great bearing on your insurance. A standard classic auto insurance policy may only cover you whilst driving to and from classic auto shows. It you intend to use your classic car for more than this then make sure your policy covers you.

It's a sad fact of life that insurance companies will do their utmost to avoid paying out on claims so it is in your interest to make sure that have a cast iron policy. When looking for quotes always read the terms and conditions before handing over your cash. If you have or are thinking of getting a classic auto then don't forget to protect yourself if the worst should happen.

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