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Insider's Guide To: Insuring A Classic

After buying a classic car, one of the major costs can be insuring it. Many a classic owner will have received a shock when trying to insure their car through a normal insurance company or broker. However, help is at hand thanks to specialist insurers who understand the classic car market.

As with all types of motor insurance, you need to be clear about the use the vehicle will be subject to. Be honest about using the car for commuting, business, foreign travel, tracks days or competition, but also consider how many miles you are likely to drive it over a year. Anything over 7500 miles is likely to be considered as daily use and could make classic car insurance impractical for the insurer to offer.  However, most companies allow the owner to add extra miles to a limited mileage policy to allow for more use during the year. Also, are you going to take the car off the road over the winter months? All of these factors will have a bearing on the premium you pay.

When you have decided all of these items, you may find some insurance companies have a different idea of what constitutes a classic car to your view. Many cars that are now in the classic arena can be younger than 25-years old, which can mean they are seen as simply old rather than classic. This is where an owners’ club can come in useful to offer either a dedicated insurance package arranged through the club or advice on which insurers will consider you and your car.

The price you pay for a premium will depend on the value of your car, where it’s stored and your driving history. Agreeing a value for the car can save aggravation should it be damaged or stolen so you can find a similar replacement. With classic cars that are rising in value, be sure to renegotiate the car’s value when renewing insurance or you could find yourself unable to replace your classic if it’s written off.

If the policy states it will pay out the market value of the car, this could be substantially less than your vehicle is worth, so read the small print carefully before committing. Most insurers will accept an agreed value determined by an expert in that make and model or from an owners’ club.

As well as an agreed value, you need to decide what type of cover best suits your needs. Most classic policies will provide comprehensive cover, but there can be small differences such as replacement parts. As some parts can be very difficult to obtain for certain classic cars, the cost of replacement could write-off a car that is otherwise perfectly serviceable. Conversely, a replacement parts clause could save you a lot of hassle trying to source rare spares.

Classic cars that are used for hire or weddings are more likely to need replacement parts, but don’t think a standard policy will pay out for new parts as required. If you use a car for hire or reward, you will need to state this to the insurer from the outset and have it included in the policy. Failure to state this could leave your car uninsured.

Many owners will have more than one classic car in the garage, so a multi-car policy could be a cheaper option. These policies can apply from as few as two cars and can offer greater versatility in use and mileage allowances.

Equally, a lot of classic car owners will put their car away for the winter months or consign it to long-term storage. While the car is not on the public road, it will need to be SORN’d (Statutory Off-Road Notice) to comply with the law, but it’s also wise to arrange insurance even though the car is not being used.

Many classic insurers offer specific policies for cars being stored that cover them for fire, theft and damage but are cheaper than insurance for a car being used on the road. If you put your car into storage, tell your insurer about the change in circumstances as it could mean a lower premium while the car is off the road.

To put your car into professional storage, most companies will insist the car is insured by the owner against fire, theft and damage. The storage company will have its own insurance policy to cover liability and most will also be able to arrange insurance for your car at an agreed rate depending on its value.

 

By Al Suttie

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