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How Insurance Companies View Your Older Car

September 21, 2012

Any car lover knows there’s a big difference between a car that’s getting old and a car that’s become a classic. Car insurance companies know the difference too, and insuring a classic, antique, or collector car is a very different matter from insuring a car that’s simply getting a few years old. But getting this classification on your policy isn’t something that happens automatically. Make sure you get your older car insured properly from the start.

A Difference in Value

Cars are valued by the insurance company based a number of factors, and they depreciate with every year. When an older car is insured on a standard insurance policy it will be valued in the standard way. This means that the insurance company treats it as though it is simply an aging car that has been maintained in the usual way – in other words, nothing special.

An older car that has been restored or has been modified in some way is a different matter. Classic cars that have a lot of money, time and effort put into bringing them up to a display or show car level need to be valued in a different manner. Because they are much more valuable, an appraisal by an expert is needed to ensure that they are insured for the right amount. This type of vehicle will require a special type of policy.

When it comes to antique cars, insurance companies may not offer a standard policy on vehicles over a certain age. That is because these cars, by their very age, simply do not qualify for standard policies. They must be valued in a different manner as the standard rules don’t apply.

Types of Policies

A standard insurance policy is designed for vehicles that are used as every day cars – for commuting to work, running errands, taking the kids to school. Classic, collector, and antique cars are not expected to see this kind of use. As a general rule, these cars are stored and only come out for events like car shows or the occasional pleasure cruise.

Because of the difference in use, as well as the difference in value, these vehicles require a specific type of policy. These policies cover the car for the special risks of a classic or collector car. They are also designed to provide for the much different value of such a vehicle, and will rely on an appraisal to determine that value.

Classic, collector, or antique car policies are not available from all car insurance companies. There are some companies that specialize on this type of vehicle and can help find the right policy to meet the specific needs of that car and its owner.

Restrictions on Use

It’s important to note that when you choose to insure your classic car under this specialized type of policy there are often a few restrictions on use. The policy is not designed for a car that is driven on a daily basis. Often these policies restrict the use of the car on the streets, because they are rated with the understanding that the car won’t be used for daily errands.

If your classic car is driven on a daily basis, it may not qualify for a collector car policy. It’s important to be honest with your insurance company about how you use the vehicle to make certain it is insured properly. If a claim is filed and the car has been used outside the confines of the policy, the result could be that the claim is denied.

Most policies of this nature for antique, classic and collector cars are designed for how cars that are displayed, and may be driven to the shows or towed on a trailer. The restrictions placed on the use of the car are based on the type of coverage being offered.

Insuring Your Older Car

If you aren’t certain what type of policy your older car needs, take the time to talk with an insurance professional. Based on the age, value and the use of the car, you can determine whether you need a standard policy or a specialized collector car policy.

Remember that if your car has a higher value than a car of that year, make and model normally would due to restoration or modification, it’s important that your insurance company be aware of this, or you won’t have any coverage for that value. Insure your older car properly, so you won’t lose your investment if something goes wrong.

  • Charles Hare

    As usual, you’re missing the middle ground.
    My wife & I are retired.We have a 2002 Mazda MX-5 Miata. We take it out on the odd summer day or evening. The car has 30,000 km on the clock in 11 years. It’s not antique car. It doesn’t go to collector shows. It’s not a trailer queen. It’s just a very seldom used toy that is insured as a daily driver because there’s no alternative.
    I had a 1070 MGB and currently have a 1988 BMW735i under Silver Wheels. I’m familiar with special interest and antique insurance.

    Why must I insure my Mazda as a daily driver? It’s beyond me, but I’ll tell you one thing. The first company that recognises that there IS such a thing as a seldom used toy car and insures it as such will get ALL my business.

    But I don’t expect that to happen. Neither do I expect a reply from an insurance company rep saying anything other than ‘tough luck’ on this.


  • braeden

    Question, I have an replica 1929 gazelle, do I need to insure it under a collector car insurance or can i get regular insurance because its a replica?

  • Darla

    G’Day Charlie there is a company called boomerang Insurance and you only get charged by how many k you put on your car per month. For more info Phone: 1-844-440-4434 (toll free)
    Email: boomerangclaims@sgicanada.ca