Classic car insurance

If you've invested in a classic car, consider your insurance options to ensure your pride and joy gets the care it deserves.

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You’ll no doubt want to be extra careful when choosing insurance for your beloved classic car. After all, it’s your pride and joy so needs to be handled with care, right? Classic car insurance can provide your car with the specialist protection it needs. What’s more, the insurance premiums can be competitive, leaving you with more money to spend elsewhere. Read our guide to discover how classic car insurance works, and if it’s worth getting classic cover over traditional car insurance.

What is classic car insurance?

Classic car insurance and traditional car insurance are very similar in what is covered. However, insurers that offer classic car insurance generally make some assumptions about the classic car drivers. For instance, a driver might take extra special care of the car to keep it in a good condition. They might drive their classic car much less than a standard car and at less busier times therefore covering fewer miles a year. All these factors can mean that a classic car insurance policy results in a lower premium than a traditional car insurance policy for a modern car.

There is one significant difference between classic car insurance and a traditional policy – working out the car’s value.

Figuring out how much a classic car is worth can be very difficult compared to deciding the worth of one of today’s modern cars. Insurers offering traditional policies will generally only pay you what the car is currently worth known as the “market value” if your car is stolen or written off. This can typically be much less than what you actually paid for your car as the car depreciates over time.

This might not suit classic cars that have had a lot of time and money spent on them to keep them maintained. Some classic cars can also increase in value over time. This is why many insurers that offer classic car insurance will allow the driver to agree on the value of the car and decide on the sum that would be paid out in the event of it being stolen or written off. This tends to increase the insurance premiums but the driver may have added peace of mind that they’ll receive the agreed amount rather than the market value if something bad happens.

Some insurers may also allow drivers to review this agreed value at a later date to ensure the classic car is accurately valued in the future.

When does a car become a classic?

Having your car defined as a classic will depend on which insurance provider you go to. Many will consider a classic car to be a vehicle older than 15 years and worth more than £15,000 while others may only insure a classic car if it’s at least 20 years old, is the driver’s second car and the annual mileage is low. It’s important to do your research to find the insurers that will cover your classic car.

What does classic car insurance generally cover?

While classic cover is broadly the same as standard car cover, some features do vary. Some of these include:

  • Agreed value cover. An insurer will guarantee paying you the agreed value of the car’s worth that you set if your car is stolen or written off.
  • Limited mileage. An insurer may specify that a certain annual mileage must not be exceeded such as 5,000 miles.
  • Salvage retention. If you are involved in an accident and your insurer deems the repair too costly, you have the option of either selling it to your insurer for the agreed value or keeping your damaged car and receiving a percentage of the agreed value.
  • Cover during road rallies or festivals. Cover during public events where your car may take part in a rally or be on temporary display.
  • EU cover. For use while you take your classic car on road trips around Europe.
  • Laid up cover. For classic cars, any spare parts and accessories that are temporarily off the road, in storage, being transported, on display or being restored.

What is classic car insurance excess?

Your insurance excess is the amount of money you will need to pay towards a claim. Your insurer won’t pay out for a claim that costs less than this amount. A compulsory excess amount might vary depending on the age of your car and your driving experience.

A voluntary excess is on top of the compulsory excess and is normally set by you when taking out a policy. You’ll have the option of adding or increasing a voluntary excess, which should lower your premium.

You’ll find details about any compulsory or voluntary excesses in your policy document.

How much does classic car insurance cost?

The cost of classic car insurance varies from insurer to insurer just as traditional policies do. Classic cover can sometimes work out cheaper, for example, if the car is only on the road for a few months of the year and kept in a secure garage the rest of the time. On the other hand, classic cover might work out more expensive, for example, if the car is worth a great deal of money and the agreed value is set high to take this into consideration. It’s best to shop around and compare quotes against the cover benefits, as the cheapest cover might not necessarily be the best cover for your needs.

Key things to consider when insuring a classic car

  • Increase security. If your car is not currently fitted with an alarm, think about adding one to reduce your premium.
  • Have a secure location to park your car. Cars kept in a locked garage or on a secure driveway are usually cheaper to insure.
  • Limit your mileage. Letting your insurer know about a reduction in your mileage could result in cheaper insurance, especially if your classic car is a second car.
  • Increase excess. Agreeing to pay a bigger voluntary excess could make your overall premium cheaper. But remember that your insurer won’t pay out for a claim that costs less than your excess. So be careful about making it too high, as it could leave you out of pocket if damage occurs.
  • Limit optional extras if you don’t need them. Think carefully about which optional extras you really want as adding extra protection to your policy will generally push the price up too.
  • Avoid paying monthly. If you can, try to pay for your premium in one go as you’ll pay interest if the premium is spread out over the year.
  • Limit modifications. Any modifications made to your car to make it look or drive better are likely to increase your premiums so think carefully before making any changes.
  • Consider specialist/telematics insurance. Insurers tend to assume that as a classic car driver, you’re unlikely to drive it during busy times of the day or commute to work in it, and that you’ll drive fewer miles. Choosing a specialist or black box policy may work out cheaper.
  • Shop around. Don’t simply choose to renew your car insurance when it’s up for renewal as you could end up paying more than you need. Shop around and compare your options to find the best deal.

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