How Does Classic Car Insurance Work?

documentation_smallerThere aren’t many people who enjoy sitting down to a good ol’ insurance review session. Car insurance is often boring and a bit confusing, so once you have your coverage set most people will simply renew their policies regularly and call it done. However, if you’re more of a vehicle fanatic that your average daily driver, you’ll likely need to sit down with your insurance agent and take a closer look at classic car insurance.

Classic car insurance varies in a number of ways from your everyday car insurance. For example, your average car insurance often requires the use of specific repair shops or appraisers when filing a claim. Classic car insurance will often have more flexibility in allowing you to use a repair shop or mechanic of your choosing. Premiums for regular insurance isn’t often flexible, whereas classic car insurance may have varying premiums based on the number of miles driven each year.

Do I Qualify for Classic Car Insurance?
Not every vehicle will qualify for classic car insurance. To qualify, vehicles and their owners often have certain requirements that must be met. For example, the vehicle often must be driven for less than 2,500 miles each year and cannot be used for commercial purposes. The drive often must also own an everyday or ‘daily driver’ vehicle in addition to the classic car. In certain situations, both the driver and the vehicle must be a certain age to qualify as well. Be sure to discuss any and all requirements with your insurance agent when it comes to classic vehicle insurance.

Actual Cash Value vs. Stated Value vs. Agreed Value
Because your classic is likely more valuable than your everyday vehicle the type of coverage you select should also be different. Actual Cash Value is the valuation process used on regular insurance and pays out based on the ‘book’ or depreciated value of the vehicle. As such, you’ll likely want to avoid ACV when it comes to classic car insurance.

Stated Value is a little tricky. Essentially, this type of policy allows you to save money on premiums by accepting an insured lesser value for the vehicle. So, if the premium is too much for the $250,000 Lamborghini you just bought, you can save money on premiums by only insuring the value of the vehicle up to, say, $150,000. Stated Value policies also will often contain a clause that allows the insurance company to pay based on which ever is the lesser amount between the stated value and the actual cash value.

Agreed Value is a short and sweet type of coverage. You and your insurance company simply come to an agreement on the value of the vehicle. In the event that the vehicle is damaged or destroyed, the insurance company pays out the agreed upon value – no more, no less.

Shop Around
Classic car coverage policies can vary greatly from company to company. There are also insurance companies that specialize in the coverage of classic and vintage vehicles, so you may need to hold coverage with a different company for your classic than you do with your day-to-day vehicles. This list from is a great place to start if you’ve never explored classic car insurance before.



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