If you have a classic, vintage or antique car, standard car insurance probably isn't going to be your best option in terms of cost or coverage. One of the reasons for this is that most standard car insurance policies pay out at actual cash value, or what the car is worth after factoring in depreciation.
In comparison, a collector car probably is increasing in value as it gets older. If you have a regular car insurance policy for it, odds are it's not going to offer the coverage you need after a major accident without you paying a high premium, if at all. You need what's called "agreed value" coverage in order to have the car's true value taken into account.
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Collector car insurance vs. standard car insurance
The key difference between agreed value car insurance and a regular car insurance policy is that a classic car insurance policy pays out on claims at agreed value rather than the actual cash value of the car.
If you have a standard car insurance policy and your car is a total loss, your provider will pay out on your claim at the actual cash value of the vehicle. Actual cash value is what your car is worth after calculating in any depreciation due to age.
An agreed value car insurance policy, on the other hand, pays out at a fixed value when you file a claim. This way, depreciation does not affect your payout. This is an important point if you own a classic vehicle that can be worth quite a lot more than your standard car on the road.
As an example, your car insurance company decides your classic car has an agreed value of $150,000. In the event of an accident resulting in a total loss, you'll be paid out $150,000 and no less. If you buy a standard car insurance policy, you'll be paid out whatever your insurer calculates the car's street value at the time. Standard car insurance usually doesn't reflect the rarity factor of a collector car, which can be a large part of the value of the vehicle.
The difference between classic, vintage and antique cars
The difference between the different types of collector cars primarily comes down to the age of the vehicle. After that, the value and any historical status will play a part in the categorization of your collector car.
"Classic car" is a general term for cars over 20 years of age; however, it is usually used in reference to muscle cars and sports cars. Classic cars are usually built to be faster than antique or vintage cars. Classic cars are used for anything from pleasure driving to car show exhibition.
Antique cars are 45 years old or older. They tend to be restoration projects or exhibition cars. They're not often used for pleasure driving.
Vintage cars are built between 1918 and 1930, and usually see even less time on the road than antique cars. Normally the only way to see a vintage car is as a showpiece or in someone's garage.
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The best insurance companies for collector cars
There are specialty car insurance companies that focus on covering classic, antique or vintage cars, but some big-name providers cover them as well. The best we found are American Modern, Grundy, Hagerty, J.C. Taylor, State Farm and USAA.
American Modern partners with GEICO to provide car insurance for collector vehicles. American Modern offers:
- Flexible mileage plans ranging from 1,000 miles to unlimited miles.
- A flat-rate liability charge. This means that American Modern charges one liability rate for all cars on the policy, rather than separate liability charges for each car.
- Coverage for lost or stolen spare parts.
Grundy specializes in coverage for hot rods, muscle cars and other exotic vehicles. Its policy benefits include:
- Unlimited miles for pleasure driving, as long as it's not daily driving.
- If you experience a breakdown, Grundy covers you for hotel and repair costs up to $600. Also, towing and labor charges are covered up to $250.
Grundy requires the following from its policy holders:
- You must have a clean driving record.
- The collector car needs to be stored in a fully enclosed garage.
- You need to own a separate car for daily driving.
Hagerty partners with Progressive to provide coverage for all varieties of collector cars. The key perks of the Progressive Classic Car by Hagerty policy include:
- No fixed mileage restrictions, meaning you can use it for going as far as you need to for exhibitions, organized meetings and even some pleasure driving. No daily driving is a condition of the policy.
- 24/7 full-service roadside assistance.
- Customizable policies that allow broader travel options and coverage for restoration projects.
J.C. Taylor offers insurance for hobby vehicles. Its coverage for collector cars includes:
- Coverage while traveling in the U.S. and Canada. Special arrangements are available if you want to take your collector car overseas.
- No mileage limit for driving for hobby purposes.
To qualify for a collector car policy through J.C. Taylor, the car must be:
- Factory original, in good or restored condition.
- Stored in a secure and fully enclosed garage.
- Strictly a hobby vehicle.
Of the major car insurance providers, State Farm offers some of the best coverage for collector cars. Its benefits include:
- 24-hour Good Neighbor Service, allowing you to call with questions or issues at any time.
- Spare parts for your collector car are covered up to $500.
State Farm requires that the collector car be driven on a limited basis. Talk with a State Farm agent for details.
USAA is often considered the best of the best for standard car insurance. Its collector car insurance perks include:
- Flexible mileage plans, ranging from 2,500 to 7,000 miles.
- Automatic 30-day coverage up to $100,000 for qualified vehicles you add to your collection.
In order to qualify for USAA's collector car insurance, you must:
- Adhere to your mileage limit
- Not use the car for racing
- Store the vehicle in a locked and fully enclosed garage
It should also be noted that USAA only provides car insurance for current and veteran military members.
What does collector car insurance cost?
Collector car insurance usually costs 39% to 50% less than a standard car insurance policy. This is largely due to the vehicle's limited amount of time on the road, therefore a more limited chance of an accident. Restricted driving is often a requirement of most collector car insurance policies.
Other factors that are calculated into your collect car policy include:
- Your ZIP code
- The car's agreed value
- How often you drive it
- Storage for the car
- Your deductible and applicable discounts
To find your best coverage at the best price, make sure to compare car insurance quotes from several companies.
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