Classic car owners are renowned for their enthusiasm for their vehicles and for how careful they are to ensure their cars are kept in the best possible condition. So is this reflected in their
car insurance premiums?
In this guide we examine the factors that determine classic car insurance premiums and how owners can bring their costs down.
How much does it cost to insure a classic car?
Insurance premiums are determined by a number of different factors – in fact, you could drive exactly the same vehicle as your next door neighbour and still face radically different premiums. That’s because insurance companies taken into account factors including your driving history; your address – such as whether you live in a busy traffic or high crime area; your personal circumstances, such as whether you are married and what you do for a living; your annual mileage; and, of course, the vehicle itself.
Generally, older cars earn cheaper premiums from insurance companies because they cost less to repair/replace in the event of an accident. However, in the case of many classic cars their parts can be more expensive (due to their rarity) and because their values often increase year on year, they could be more costly for an insurance company to replace in the event of a write-off/theft.
As such, insurance companies categorise classic cars into different groups which are then used to evaluate their risks, values and premiums. The groups are:
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Veterans: Refers to vehicles manufactured up to December 1904.
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Edwardian: Vehicles manufactured from January 1905-December 1918.
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Vintage: These are vehicles manufactured from December 1918-1933.
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Classics: This refers to cars typically manufactured pre-1975.
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Cherished: Collectible or rare cars that are 5 to 10 years old.
While some conventional insurance companies have teams to deal with classic cars, premiums may be higher than insuring a more modern vehicle. However, there are several specialist insurers on the market that claim to offer value for money for classic car owners with policy features tailored for their needs.
What features are available from a classic car specialist?
Some of the incentives that may be offered by a classic car insurance specialist are:
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Agreed/increasing valuations: Typically, if a classic car were written off or stolen while insured with a conventional insurance company it would be subject to a market valuation. As valuations of classic cars are so subjective, you could therefore be left out of pocket. However, with a guaranteed agreed valuation you know from the outset what the vehicle is worth and are assured a fixed payout. Indeed some classic car insurance specialists even offer increasing valuations based on the fact that the value of many classic cars increases annually.
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Laid-up insurance: If your classic car is a work in progress then you may want a laid-up insurance policy which protects it against theft and mishaps.
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Rally/track cover: Anyone planning to enter their classic car into a showcase event such as a rally, hill climb or track race should look for a specialist policy – otherwise your vehicle may not be protected.
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Wedding/hire cover: Should you decide to rent out your classic car, ensure this is stipulated in the terms and conditions of your policy.
In addition, several specialist classic car insurance companies offer incentives designed to help drivers save money including:
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Advanced driving course discounts: Completing a course such as the Pass Plus or IAM could earn a discount.
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Limited mileage discounts: Agreeing to an annual mileage limit can cap your premiums.
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Owners’ club discounts: Enthusiastic classic car owners are sometimes rewarded for being more careful with their vehicles with owners’ club discounts.
Other ways to save on classic car insurance
While specialist classic car insurance providers are well worth considering because of the additional cover features they offer, their policies should still be compared to those from conventional insurers. By using a comparison website you can compare both the quotes available and policy features on offer from a range of insurers – the leading websites compare deals from more than 120 companies – to ensure you’re receiving a competitive deal.
In addition, look for ways to reduce your perceived risk to an insurer to bring premiums down further – for example:
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Drive safely: With some insurance companies you could earn a no-claims bonus worth as much as 60 per cent off your premiums after four or more years.
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Increase security: Consider fitting a modern alarm, an immobiliser and a tracking device – your insurer should be able to recommend which systems earn the largest discounts.
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Increase your excess: The excess is your contribution towards a claim – increasing it will lower premiums, but only set it at a level you can comfortably afford.
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Park safely: Keep your classic car in a locked garage overnight to lower premiums.
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Pay annually: You may be able to avoid interest charges by paying premiums annually.
By Paul Lucas
