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Insuring Your Classic Car: Issues to Consider

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Authored by Kumara Velu in Insurance
Published on 04-14-2009

Have you just acquired a classic car and are confused as to its insurance coverage? The first pitfall you should avoid is having your car insured with a company that has no experience insuring classic cars. You may not have your valuable investment fully covered. Worse, you may end up paying a higher premium owing due to the failure of the company to properly assess the risk of insuring your classic vehicle.

Look for companies with experience in insuring classic cars. Check with other classic car owners or visit forums relating to classic cars where insurance matters are discussed.

Once you have decided on a reliable company with experience in classic car insurance, you can consider the following questions:

Can I use my own mechanic for repairs in the event of an accident? Will I be forced to repair my car at the company’s panel workshops? Are these workshops qualified to repair classic cars? Can I insure my car for what I feel it is worth? Will I be covered with liability insurance during participation in club events? Will I be covered for any damage that occurs when I participate in classic car events? Will there be insurance coverage when my car is undergoing restoration? Can I obtain flexible premiums based on the distance I cover annually?

Will there be coverage should I want to ship my car to another state or a foreign country to participate in classic car events?

You may be offered a specialty package to take car of your classic car insurance needs. Such programs may come with conditions attached.

Check to see if:

You must be the owner and user of a daily driver vehicle Your car must be of a certain age You must be of a certain age The distance covered by your car must not exceed 2500 miles a year

You must not put your car to commercial use

Other Issues

When you’re offered a contract, you will have to read it carefully to learn of clauses not revealed during your discussions with the insurance company. If you’re not clear about any clauses you must get a qualified officer from the company to explain to you in layman’s terms.

Most insurance companies will try to offer you the lowest value possible if your classic car has to be totaled. You must consider this aspect carefully. How much would you expect if your car has to be totaled when it’s badly damaged in an accident? Make sure you will get that sum even if you’ve to pay a slighter higher premium. As far as possible, try to sign up for an Agreed Value policy so that you would get the desired compensation in the event your car has to be totaled.

If you find that an unreasonably high premium is charged to satisfy your needs, you would have to shop around for a better rate.

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