How to Fit Classic Auto Insurance into Your Budget

If you need to know how to fit classic auto insurance into your budget, you may need to complete a few steps first. Many car insurance companies may offer you a level of protection, but that does not mean they know about this particular class of automobiles.

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When you want to insure your classic car, it is wise to take your questions to the experts. Never settle for a standard car insurance company that does not have all of the facts. Remember, they mostly write policies for everyday vehicles. They may not have the experience needed to provide you with a fair price because they base their rates on the value of your vehicle.

Classic vehicles appreciate in value, unlike newer cars, which depreciate. This means your current car insurance provider may not offer you the proper type of policy because it opposes their traditional way of thinking.

Unfortunately, many people simply add their classic car to their traditional car insurance which eventually winds up costing approximately 30% to 35% more.

If you take the time to find a company that specializes in the correct type of insurance, you will be pleasantly surprised at the results.

Of course, the same rules should apply as far as researching goes. Make sure you get at least three quotes before making your final selection and ask questions when you see a discrepancy in prices. A hundred dollars is not too bad, but when the rates differ by more than this amount, there could be an issue.

Just because you have a classic vehicle, does not mean you have to break the bank for insurance. You should be able to find something your finances can handle. You should also have the same level of service, dedication, and trust from your provider.

Identify the Different Types

Classic car insurance is very different from the conventional liability, collision, and comprehensive coverage. There are usually three types for you to select. Nevertheless, the best kind is generally called agreed value or AV.

Agreed value auto insurance is an amount that both you and the car insurance company settle on in terms of the value or worth of your car. Instead of looking at the depreciation value, the amount is based upon the money you put in and the condition of the vehicle.

Since most of these kinds of cars require restoration and consistent maintenance, they consider these costs in the overall price. Once you arrive at the dollar amount, your vehicle receives 100% coverage and you do not have to pay a deductible if an accident occurs that requires repairs.

Before you meet with the car insurance company, have your vehicle appraised and bring the documents with you. Keep the original paperwork and make sure they retain a copy for their records. If you do need to file a claim, it will be to your favor.

Another level of insurance is stated value or SV. This kind of coverage is similar to AV, with one exception. While you still have the option of stating your car’s value, the insurer makes no guarantees for the stated value. You may receive all, most or much less than the original price, you agreed upon. In addition, you may have to pay a deductible of $1,000 or more.

The final level is actual cash value or ACV and this is what a typical auto insurance company offers. They base your insurance coverage off the book value instead of the actual value. In many cases, you could cheat yourself out of a huge amount of money.

Even if the value of your car is higher than most new cars, once the claim process begins, they go directly to the depreciation amount. This is what you receive towards your replacement or repair costs. An ACV plan is never recommended for classic car owners.

Look for Companies That Offer Inflation Guard Protection

When you want to save money upfront, you should select the proper type of coverage. However, when you want to save money over time, you should look for a car insurance company that offers inflation guard protection.

Inflation guard protection is a type of security for classic cars that increases intermittently. The longer you keep an active policy, the more your coverage climbs by a preset percentage. Most times, this occurs every quarter, or four months. You can be sure that your investment receives protection for the full value.

A custom, classic automobile is something that requires long-term maintenance and this is an excellent way to fortify your asset. In just a few years, you can see savings between 15% and 20%.

Protect Your Vehicle On and Off the Road

To ensure that your rates do not break your annual budget, you should utilize protection efforts both on and off the road. For example, you should have a garage to store your car. If you do not have a garage at your home, you can rent one for a low monthly rate. A carport is the last choice, but it will still safeguard your vehicle better than leaving it in the open.

It is important to note that many classic car insurance companies will not provide you with a policy if you do not have a garage. They may require you to produce proof as well.

You should have a second vehicle for daily use.

You cannot drive your classic vehicle every day or for business purposes. Remember, this type of automobile is for infrequent rides to car shows, rallies or for the occasional drive during great weather.

Limit the miles each month to avoid going over the annual allotment that your car insurance provider gives you. They will more than likely attach a specific amount between 1,000 and 6,000 per year.

When speaking to potential insurance companies, try to find the lowest possible limits in this area so you can keep the rates affordable. Just remember, if you exceed this number, they have the right to cancel your policy.

Categorize Properly

Not every old car fits into the category of a classic vehicle. You need to make sure yours does before you start looking to help keep your car insurance needs in proper perspective. The same is true for antique cars, which many confuse.

The Pennsylvania Department of Transportation defines a classic car as any original, not reproduced, motor vehicle manufactured 15 years before the current year. The automobile should be well maintained or restored to the conformity of the first line produced.

This includes the specifications of the year, make and model as well as the overall appearance. An antique motor vehicle has similar standards, except the time period extends to 25 years or more. For this reason, antique cars generally cost more to insure than classic cars.

To expand on these qualifiers, it means the vehicle must be the first of its kind from the assembly line and be in excellent condition. The body must be free from dents and scratches and the interior should have a pristine look. It should also have a working engine, free from noxious fumes or harmful emissions.

If you are not sure about how your classic vehicle affects the current environmental laws, you should go to the Environmental Protection Agency and read the information regarding older vehicles. You may find that your model is now exempt.

Make Sure You Fit the Criteria

When dealing with classic car insurance providers, they often have certain criteria for issuing policies. The standard requirements include age and driving knowledge.

It may not seem fair, but the majority of the insurers want seasoned and experienced drivers over 35. This is due to the risk factors involved.

This is certainly true with teens and young adults who, according to the Center for Disease Control and Prevention have established patterns of underestimating dangerous scenarios and tailgating.

Other reports from organizations like the Governors Highway Safety Association and the National Highway Traffic Safety Administration have similar findings in their reports.

In fact, the NHTSA just completed a study involving both young and older drivers to compare safety issues with these two groups. Their results show the main reason for accidents with younger drivers involve their lack of focus on the road coupled with distractive behaviors.

In addition to age, skill is just as important to insurers. Therefore, drivers of any age, with less than 10 years of hands on knowledge may find it similarly difficult to meet the criteria for low car insurance rates. For these reasons drivers over 35 have a better chance of receiving inexpensive quotes to insure their classic vehicles, since historically, they represent a lower risk.

Ask Around

Classic car-owners usually belong to clubs where they tour, attend parades, and antique shows. During your next outing, find the best time to bring up the question of car insurance. Find out whom they use and put them on your list to research their options. Remember to inquire about their customer service process. You want to have professionals you can rely on.

They should also be able to estimate what you can expect to pay on an annual basis and they will be honest with you. This information will be very helpful when you get your quotes. If you do not have a starting point, you may not know when you are getting a deal.

Unlike friends and family members, who often love to give you helpful hints, your club members actually, have valuable advice. Since they are in the same situation as you, they may be able to give you options you never thought about.

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