The hunt for the perfect classic car is a dream endeavor. And once you've found it, you may spend enjoyable hours restoring it. You'll also sink some expense into this hobby. Once you've bought and restored your dream vintage car, keep your investment safe with the proper auto insurance policy.
Insurance from Day One
The moment you buy your classic car, Nerd Wallet suggests you buy insurance coverage. This is true even if it's going to be sitting in your garage while you restore it. Since collector cars are by nature limited editions, any damage they suffer may be very expensive. Such damage can happen even in your garage – think of a flood or even items falling from a shelf onto your car. Talk to your insurance agent about a comprehensive policy appropriate for your situation with your vintage car.
A traditional auto insurance policy may be too expensive to be feasible for your classic car. This is because classic cars don't offer safety features such as electronic stability control or anti-lock brakes. Therefore, classic auto insurance policies work with you on an agreed value – companies keep their eye on the trends in the classic auto marketplace. This value can be significantly more than the actual cash value of your car. They also don't incorporate depreciating value, so your premium usually stays the same. The policy pays out in case of totaling the car or theft.
Restrictions with Classic Car Insurance
Your collector car is a valuable item, and many classic policies restrict your usage. For example, the most restrictive policies may limit your usage to certain circumstances such as car shows. Indeed, they may require that you prove ownership of a separate auto for your daily commute. Other policies can be a little more lenient, only requiring that you keep your mileage under a certain limit. Granted this mileage can be very low, but it can be even as high as 10,000 miles.
For some car collectors, it's all about restoring an auto to its classic state. For others, they want to modify the classic car for performance – this is especially true with "muscle cars" such as vintage Mustangs. Modification can also include custom paint jobs. All of these change the value of your car. As such, you need to talk to your insurance agent about additional coverage for the modifications. Again, if the car is stolen or totaled, a traditional or even classic insurance policy may not be enough to cover your expenses related to modifications.
Properly insure your collector car to protect your investment.