Antique Insurance for Your “Old Auto”

If your classic or antique automobile is covered under a traditional auto insurance policy, then you may be wasting your money. Most people who know they have a classic or vintage vehicle don’t use that vehicle as they would their “everyday car”, and the insurance carried for it should take that into account. You’re much better off acquiring an insurance policy that is designed especially for the older car. You’ll be giving your car the coverage it needs and might even save on premiums in the process.

Old Cars vs. Classic Cars

So, what makes a vehicle antique, classic or just plain old? Each insurance company has its own definitions; but, in general, a classic car is one that is anywhere from 15 to 30 years old. It must also have some value on the collector’s market, be in good overall condition and not be used for commuting or any commercial endeavor.

 A vehicle that is deemed to be “antique” is more than 25-30 years old and is only used for show purposes. Antique vehicles are usually outfitted with some sort of historic license plate as well. They can be driven, of course, but only in association with a show. An older vehicle that does not meet the criteria for either the “classic” or “antique” classifications is considered to be simply an “old car” and if used at all, must be covered under a traditional auto insurance policy.

Why the difference in automobile classifications so important? There are many specialty auto insurance companies that deal exclusively with collectable vehicles. If your car or truck is “antique” or “classic”, then you may qualify for insurance rates that are lower than traditional auto policies.

The Antique or Classic Car Appraisal

If you want your car insured for any amount greater than its book value, you may have to get an appraisal done (appraisals also come in handy in cases of divorce or estate planning). In the course of an official appraisal the car is properly categorized, its condition is documented and a list of comparable vehicles (along with their values) is made.

Choosing the right appraiser is very important. The person you choose to evaluate your vehicle should be knowledgeable about similar makes and model, should provide references and should make his or her résumé available to you. If you have trouble finding a qualified appraiser on your own, check with the American Society of Appraisers (ASA). The ASA will at least be able to point you toward the most helpful resources.

In order for the automobile to be properly insured, it must be properly categorized. Information such as body style, make, color, model, year and Vehicle Identification Number (VIN) or engine number are all noted. For some vehicles (i.e. Corvettes and Ferraris), the VIN is needed in order to verify authenticity.

Proper consideration of the vehicle’s condition is very important when appraising its value. The appraiser will need to thoroughly examine the vehicle, run it if possible and document the condition in a detailed written report. The appraiser will also record the vehicle’s condition through the use of photographs.

In order to add additional validity to the appraised value of the vehicle, the appraiser will also include in his or her report a list of comparable vehicles and their prices. This information can come from sale and auction results, vehicle price guides, advertisements and any other printed material that documents a similar vehicle’s market worth.

Insurance for the Antique or Classic Car

Obtaining insurance specifically designed for classic cars is very important. The correct policy will provide just the right amount of coverage for your vehicle. Furthermore, agencies that specialize in vehicles like yours are more likely to understand your special needs and concerns.

There are three types of insurance coverage for classic or antique cars, all of which are substantially less expensive than standard auto insurance: actual cash value, stated value and agreed value. Actual cash value (ACV) sets a value for the vehicle at the time coverage is obtained; and, as the vehicle ages, the ACV decreases. If a claim is made, the insurance adjuster is the one who sets the final ACV. In case of a claim, stated value coverage (SV) pays either the stated value of the vehicle, the cost to repair the vehicle or the ACV, whichever is less. Agreed value coverage (AV) is the most recommended type of coverage for an antique or classic vehicle. AV guarantees a set amount of coverage (set at the time the policy is purchased) should a claim arise.