Classic car insurance

You’ll no doubt want to be extra careful when choosing insurance for your beloved classic car. Your pride and joy needs the very best protection, after all. Classic car insurance can provide your car with the specialist cover 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 specialist classic cover over a traditional car insurance policy.

What is classic car insurance?

Classic car insurance is cover designed for older cars that are typically used for leisure purposes, rather than being used for your commute or as a family run-around.

While classic car insurance has many similarities with regular car insurance, there are some important differences that recognise the unique nature of many classic cars.

What makes a car a classic?

Many insurers will consider a classic car to be a vehicle older than 15 years and worth more than £15,000, but definitions will vary. For example, some might only regard a car as a classic if it’s at least 20 years old, is the driver’s second car and the annual mileage is low.

What does classic car insurance cover?

Classic car insurance will cover you for the same risks as regular car insurance. Subject to the level of cover you opt for, you’ll be protected against the following:

• Harm you cause to other people or their property if an accident is your fault
• Theft of or vandalism to your car
• Fire or severe weather damage to your car
• Accidental damage to your car.

Extra features that are more unique to classic car insurance policies often include the following:

• Agreed value cover. You and the insurer agree to a fixed value for your car that you’ll receive if it’s stolen or written off. This is usually higher than its market value would be set at.
• Salvage retention. If you are involved in an accident and your insurer deems the vehicle repair too costly to justify, you have the option of either selling your car 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. Classic car owners like to show off their prized possessions by driving in rallies or displaying their cars at events. This may include taking part in motorsports or races, so check the details.

What are the most common classic car insurance exclusions and restrictions?

Classic car insurance comes with many of the same exclusions as regular car insurance. So your insurance is likely to be rendered invalid if, for example, you drive under the influence of drugs or alcohol or fail to keep your car roadworthy.

Another restriction of some classic car policies is a cap on annual mileage (5,000 miles, for example). Choosing a policy with this restriction can keep premiums down, but you’ll need to take care not to exceed it. If you suspect you might, let your insurer know in advance. If you don’t, it could result in subsequent claims being declined.

You may also find that some classic car insurance policies have a minimum driver age limit. Under 25s, for example, may have to search a wee bit harder to find affordable insurance.

Are there different types of classic car insurance?

Technically, you can get the same 3 levels of cover (third party, third party, fire and theft and comprehensive) as for any other car. Though, if you love your car as much as most classic fans do, you’re probably going to opt for a comprehensive policy rather than lower-level cover that won’t pay out a penny if you prang your valued vintage.

The other type of insurance you’ll often come across in relation to classic cars is something called “laid-up” cover. This insures a classic car against fire, theft and vandalism if it’s temporarily off the road being restored, on display or in storage.

What optional extras do I need if I drive a classic car?

You’ll come across many of the same optional extras as for any other car. The following add-ons could be worth considering for classic cars:

• Breakdown cover. Vintage cars aren’t necessarily the most reliable, so breakdown cover could be a valuable investment. Check levels of cover and any restrictions (on a car’s age, for example) to make sure you have the protection you need.
• European cover. Classic cars are usually driven for pure pleasure, and pursuit of that pleasure might take you to foreign shores. As standard, most car insurance only covers you on a third-party basis to drive in Europe. You’ll probably need to pay extra for comprehensive cover.
• Business cover. Some classic cars can be in demand as transport for special events, such as weddings. If you want to use your car to earn a bit of extra income, or for any other business purpose, you’ll need to make sure you have the right cover.

What is “agreed value” for car insurance?

Agreed value is where you and the insurer agree on a specific value that you’ll receive in the event your car is stolen or written off. It’s often used for classic cars because their age, combined with the level of restoration work that often goes into them, makes it hard to set a market value. Market value is what’s used for most modern cars, based on a car’s resale value on the open market and taking depreciation into account.

How can I find the best classic car insurance?

With most car insurance searches, the best place to start is usually a price comparison site. This approach is less useful for vintage cars, as many mainstream insurers won’t offer cover (or suitable cover) for genuine classics.

Depending on your car, it doesn’t hurt to try a comparison site. But you should also try a few brokers that specialise in classic car policies. If you’re a member of a car club, it’s worth checking if they offer any discounts with specific insurers too. Though remember a discount on an expensive policy may still leave you worse off than seeking out a cheaper underlying premium.

What do I need to get a quote for classic car insurance?

To get a quote for classic car insurance, you’ll need to supply all of the details that you would for any other car insurance quote (your age, your address, how you’ll use the car and any history of claims or driving convictions).

The main extra detail you’ll often need for classic car insurance is evidence of the car’s value, so you can set an “agreed value” on the car.

Some insurers may accept a price you provide directly, backed by evidence such as small ads for similar vehicles in a similar condition and photos of the car from multiple angles, inside and out. Bills for recent restoration work you’ve had done may also be helpful.

Other insurers require a professional valuation, and this may be more straightforward than trying to put your own value on the car. Classic car clubs often have experts that can provide valuations, usually for a fee.

How much does classic car insurance cost?

The cost of classic car insurance varies from insurer to insurer just as traditional policies do. Factors that play a part include the car’s value, where you live, your age and your driving history.

As always, it’s best to shop around and compare quotes against the cover benefits. Bear in mind that going for the cheapest cover could be a false economy if it doesn’t meet your needs.

Is classic car insurance more expensive than regular car insurance?

Surprisingly enough, it’s often cheaper. Classic car owners tend to drive their prized possessions safely and store them securely as well as go the extra mile to keep them in good condition. That, plus the fact they’re usually driven less than your typical run-around, can mean that classic car drivers pay lower premiums than they might for a modern car of similar value.

On the other hand, if a classic car is worth a great deal of money and the agreed value is set high to take this into consideration, this can push premiums up.

How can I cut the cost of classic car insurance?

• 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. Agreeing to limit the distance you drive each year can make for lower premiums, especially if your classic car is a second car.
• Increase your 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.
• Consider specialist insurers. Insurers that focus on classic cars may offer more targeted, and potentially cheaper, cover.
• Join a classic car club. Whether you’ve got a Morris Minor or a retro Mini, there’s probably a national or regional car club for drivers that share your passion. Many offer member perks, including discounts on insurance.
• Shop around. Don’t simply renew your car insurance by default every year. You could end up paying more than you need. Shop around and compare your options to find the best deal. It could even be worth trying to negotiate a better deal with your existing insurer if you like everything about your policy but the price.

Can I get temporary insurance for a classic car?

Yes, there are providers that will be happy to insure a classic car for a short period – anything from a few hours to 30 days. This could work well if you want to test drive a potential purchase or if your car spends most of its time off the road in storage and is only released for a few days a year. Bear in mind, though, that temporary policies may not offer some of the benefits of a tailored, annual policy – such as agreed value cover or salvage retention.

Is there a limit on how many miles I can drive under a classic car insurance policy?

It depends on the policy. In exchange for lower premiums, some may cap your annual mileage at a lower limit; 5,000 miles is fairly common. If you start getting close to this cap, you’ll need to let your insurer know. They’ll probably charge you extra to exceed it, but doing so without telling them could invalidate your policy.

What are the most popular classic cars?

Given that, by most definitions, a car counts as a classic if it’s more than 15 years old and worth more than £15,000, the most widely owned models that hit these marks may simply be cars that are getting on a bit and that many of us wouldn’t think of as particularly “classic”. So, putting that blunt criteria aside and going instead for cars that most of us would instantly recognise as icons, classics that have more than their fair share of fans include the following:

• The Mini Cooper
• The Volkswagen Beetle
• Old-school Land Rovers
• The Jaguar E-Type
• James Bond’s car of choice, the Aston Martin DB5

Bottom line

Classic car insurance can be surprisingly affordable and often offers extra protection for your vintage icon above and beyond what you’d get with a regular policy. It’s well worth checking specialist insurance brokers alongside mainstream providers, as they may offer enhanced cover for a competitive price. Don’t forget to keep an eye out for any restrictions or exclusions that could render your cover invalid, though; the last thing you want is to prang your prized possession and discover you’ve fallen foul of a clause you hadn’t spotted.

Frequently asked questions

• Are there age limits on classic car insurance?

  There can be on some policies. Some classic car policies won’t insure drivers under 25, for example. But some will; young classic car enthusiasts may just need to shop around a little more.

• Can I insure a classic car that's had modifications?

  Yes. In fact, while modifications to modern cars are generally seen as a bad thing as they raise a car’s risk level, this rule doesn’t apply in the same way to classic cars. If you’ve got a classic, there’s a good chance it’ll have needed modifications to make it roadworthy (such as a new engine) or improve its condition (perhaps a respray). Classic car insurers know that these modifications are often necessary. They treat them differently to modern car modifications that are intended to make cars go faster or pimp them up, and which also push insurance premiums up. Classic car modifications can sometimes also result in premiums going up, but not always and not by as much. If they do, it’s often simply because the modifications have increased the car’s agreed value.

• Can I use my classic car to transport paying passengers?

  Only if you have the right level of insurance. As standard, classic car insurance is unlikely to cover you if you use your car for business purposes. This would include using it to drive paying passengers to and from special events such as weddings, for example. So if you’re thinking of starting a sideline as a part-time chauffeur, you’ll need to take out business cover. Check with your insurer if you can bolt this on to an existing policy or look for a separate business car insurance policy.

• Do classic cars need vehicle tax and MOTs?

  It depends on how old your car is. If your car is less than 40 years old, you’ll definitely need both tax and an MOT. There are exemptions for older cars for both tax and MOTs, though they work slightly differently. You can read the full details on the gov.uk website, but in summary:

  • If your car was built or first registered more than 40 years ago, it may be exempt from getting an MOT. This is provided that no “substantial changes” have been made to the vehicle in the last 30 years.
  • If your car was built before 1 January 1981, you do not need to play vehicle tax. You must apply for a vehicle tax exemption to stop paying tax.

  Regardless of the need for an MOT, you must still keep your car in a roadworthy condition.

• What are the benefits of buying a classic car?

  There are a couple of financial benefits (putting aside for a moment the cost of buying, restoring and maintaining an older car). Classic cars over a certain age are exempt from paying MOT and vehicle tax and, as we’ve highlighted earlier in the article, insurance for classic cars can often be cheaper than standard car insurance. Beyond that, it’s all about the style, prestige and driving experience – and if you’re a classic car lover, you don’t need us to tell you about that.

• Do I need to insure my classic car if it's off the road?

  Provided you keep your classic car on private land, never drive it and have officially declared it off the road (or SORN), you no longer legally need to insure it. But even if it’s not compulsory, you may want to consider a laid-up policy to protect it against theft, vandalism or fire damage. And as soon as you take it back on public roads, even if only for a day, you’ll need proper car insurance again.

• Do I need a specialist policy for a classic car?

  You don’t have to take out a specialist policy for a classic car, and you may decide a regular car insurance policy gives you all the cover you need. And if your valuable vintage car is actually your main car, you may be excluded from some classic car policies anyway. Some specialist cover only applies if your classic car is a second car or if you drive it less than a certain distance each year. But if your car does qualify for a specialist policy, it’s definitely worth considering this option, as the cover is likely to be better tailored to your car’s unique traits.

• Can I earn a no-claims bonus on a classic car insurance policy?

  With regular car insurance, you build up a discount for every year of claim-free driving (up to a maximum limit). However, most classic car policies don’t offer a no-claims bonus. That’s because premiums are based mainly on the car itself, including its age, value and mileage. Your credentials as a driver influence premiums less heavily than they do for regular insurance. But, in any case, many policies stipulate that the classic car must be a second, less frequently used vehicle. This means you should still be able to build up a no-claims discount on your main, modern car.