If you’re insuring a classic car under your standard personal auto policy, you’re not alone—it’s a common tactic and unfortunately, you’re doing it wrong.
Very often when it comes to a collector or classic car, it’s seems easier to keep all cars in a household on a package policy. But in terms of daily use and overall value, insuring a classic car is drastically different from insuring a standard auto.
Here are the top three reasons you should never insure a classic car with a personal auto policy:
If you’re insuring a classic car under your standard Personal Auto Policy, you’re not alone—it’s a common tactic and unfortunately, you’re doing it wrong.
Very often when it comes to a collector or classic car, it’s seems easier to keep all cars in a household on a package policy. But in terms of daily use and overall value, insuring a classic car is drastically different from insuring a standard auto.
Here are the top three reasons you should never insure a classic car with a Personal Auto Policy:
Agreed value. You will receive greater coverage at a lower price with a classic car policy compared to a standard personal auto policy.
A collector car policy is an agreed value policy, meaning there would be no depreciation applied to the value of the car. For example, if you think your car is worth $20,000 and that also coincides with auction prices and current sell rates, in the event of a total loss, that’s what you would be paid.
By contrast, vehicle values under most standard auto policies depreciate —meaning the life expectancy of the car would be subtracted out of the value. In the event of a loss, you would get substantially less than what could be potentially be sold at an auction.
Special parts. In the event of a claim that involves repairs, a standard Personal Auto Policy tends to default to after-market parts that you as a car enthusiast may not necessarily be happy with. You may be very particular about getting original equipment from the manufacturer. A collector car policy will typically try and replace parts with like parts.
That means fixing a classic car will be far more expensive than repairing a normal vehicle, especially if you get cars that are either original condition or very authentically restored, even a windshield can cost thousands and thousands of dollars.
Claims handling. A standard personal auto policy probably doesn’t have the expertise to effectively handle a loss involving your classic car. You wouldn’t want the same person that’s managing a claim for a 2012 Ford Taurus managing a claim for your 1957 Chevrolet convertible.
Why? The standard auto policy claims are great at adjusting losses for a regular car, but they might not have the level of patience for getting through a claim process for a classic car.
Knowing the current market value for your collector car is the best way to make sure you’ll get the best price on your policy. You can use the Classic Car valuation tool on N.A.D.A Guide (http://www.nadaguides.com/Classic-Cars) to approximate the current value of your collector car. This ensures you’re only paying for the coverage you need. In addition, The Agent asks that your day-to-day car is insured with us, so we can provide you the best possible experience and savings.
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