Why insuring a classic automobile is different from insuring a normal car

Why you may need to get a special policy for your classic car.

Classic car insurance is not the same as run-of-the-mill insurance for older cars. Just like a 1966 Ford Mustang isn’t the same as a 1995 Ford Festiva, classic auto insurance is different.

With older cars auto insurance is usually liability-only. The car is often paid for and there’s no need to satisfy a bank or lien holder with full coverage. Repairing an old beater is usually more trouble than it’s worth.

But classic car insurance is quite the opposite. A classic car is generally not a means of day-to-day transportation. Like temporary car insurance, classic car insurance is unique. For instance, it’s a collectable item with significant intrinsic value. In other words, when insuring a classic car you’re more interested in protecting against material damage than against a liability claim.

When was the last time you saw a Model T in a fender bender, anyway?

Why Classic Car Insurance is Different

Classic car insurance is more interested in material damage than liability. It’s possible to get classic car insurance with no liability coverage at all. Of course, no liability coverage usually means it’s not street legal. But if all you’re going to do is store a collectable car in a garage and unveil it at car shows, it’s not a bad option.

Also unlike most standard auto insurance policies, classic cars are routinely insured for a stated value. That means you’re not referencing blue book values. Owner and insurance company simply agree to an amount to insure the vehicle when the policy is written. As with any valuable item remember: if it’s worth insuring, it’s worth appraising first.

Because of these differences, it’s often not sufficient to insure a classic car with standard auto insurance, even with a generous full coverage policy. Liability is rarely a concern here. Material damage claims on a standard auto insurance policy would be based on blue book or similar values. In the case of a classic car this may be significantly different from the vehicle’s stated or appraised value, and never a difference to the owner’s advantage.

Getting Classic Car Insurance

To qualify for classic car insurance, in most cases the vehicle must be at least 20 to 25 years old and be considered collectable. Some classic car insurers won’t consider certain makes and models even if they meet age criteria. That’s because many vehicles built in the 1970s and 1980s weren’t as well-built as models that preceded them.

Other factors to consider include condition, rarity, historical significance, body style (two-door sports cars are usually considered more collectable than four-door sedans from the same era), and country of origin. One shouldn’t have any problem getting a classic car insurance policy for a 1981 DeLorean, but a 1974 Mercury Comet – even in good condition – may prove to be a challenge.

Classic car insurance can be obtained in one of two ways. First off, you can get it through an endorsement on your existing automobile policy through a standard property and casualty company.

Secondly, you could get it separately through a company that specializes in classic car insurance. Many agents will recommend the latter since classic car endorsements on standard policies tends to be expensive and may leave gaps in coverage. Several companies specialize in classic car insurance. Hagerty is the dominant player in the field.

Getting multi-car insurance and the discounts to go with it.

Saving a couple hundred bucks is entirely possible with a multi-car insurance discount.

Most consumers know insurance companies offer car insurance discounts. However, not everybody knows exactly what discounts are offered with each insurance company. Discounts even change depending on your state and what vehicle you drive.

The basic discounts that are seen most often on all car insurance policies are safe driver discounts, car alarm discounts and even good student discounts. One of the larger discounts insurers offer is the multi-car insurance discount.

Multi-Car Insurance Discounts

Getting multi-car insurance, also known as the ‘multi-car discount’ can turn into big savings on your auto insurance premiums. To get the discount you have to have multiple cars on your policy (of course), but they don’t have to all be owned by you.  You and a significant other that are not legally married can both have your vehicles on the same insurance policy so that you can get the discount.

Just keep in mind though that a bad driving record for anyone on the policy will increase the premium for everyone.  Even with the multi-car insurance discount, if you are the one with the clean driving record, your insurance may be higher if you combine insurance.

As for the multi-car insurance discount, you can save 10% or more on your monthly, semi-annual, or annual premiums depending on the company – not a small amount when you’re insuring more than one vehicle. Discounts vary between insurers and will sometimes change, so it’s important to check with the company to find out what the current multi-car insurance discount is.

By insuring multiple vehicles, insurers can charge less premium to a family. Either way, that translates to savings for you.

How to Get Multi-Car Insurance Discounts

The easiest way to get the multi-car insurance discount is to ask. Most of the time, insurance companies will give the multi-car insurance discount on a new quote. However, you should still ask to include the multi-car insurance discount in each quote. Here are some times to ask about the discount.

Whenever you…

• Buy a new car.
• Buy a used car.
• Inherit a car.
• Win a car.
• Combine two households with more than one car.

Whatever the case, if you have more than one car in your household, you’re probably eligible for multi-car insurance. Make sure your insurance company is giving you credit for each car to maximize your savings.

One final consideration about multi-car insurance is the different discounts each company offers. Your current insurer could be a great price for one vehicle, but their multi-car insurance discount may be paltry. Whenever you add another vehicle to your insurance, get a price from your current company, then get some more quotes. A new policy with another company could mean significant savings on your auto premiums, especially if they have a better multi-car insurance discount, so it’s always good to shop around.

Why you may need a temporary car insurance policy – and how to get short-term coverage.

You may need temporary car insurance if you're renting a car.

Drivers need auto insurance in most US states. If you’re behind the wheel and not carrying an insurance policy, things could go bad quickly.

If you cause an accident, you will still be responsible for damages caused. You may even be responsible for actions you don’t cause, like in a no-fault state. That’s why it’s important to get liability coverage whenever you drive.

However, if you’re only driving every once in awhile, temporary car insurance may be sufficient. “Temporary car insurance” is a term used for short-term policies. Technically, every insurance policy is temporary because it only lasts until your next renewal – 6 months or a year down the road. However, temporary car insurance policies are used to cover drivers in situations not-deemed permanent by insurance carriers.

When You Might Need Temporary Car Insurance

There are several situations where you might need temporary car insurance. This list is not comprehensive but shows typical situations where temporary car insurance coverage would be appropriate.

• Road-trip coverage for a rental car.
• Renting a vehicle for other-than vacation purposes.
• Covering a child who’s learning to drive
• Comprehensive protection for a stored car.
• Classic car insurance while driving, if it’s not normally covered.
• Test driving a vehicle.
• Borrowing a friend’s vehicle.
• Temporary ownership of a vehicle.
• Foreigner visiting the US and driving a vehicle.
• And more…

Contact Your Current Insurance Company First

If you think you need temporary coverage, check with your current insurance company first. If you have an auto policy in place, your current policy should extend coverage to any other vehicle you drive. No need in buying something you don’t need.

If you don’t have a policy, but you’re driving other people’s vehicles on a regular basis, many companies offer non-owners policies. This provides you, the driver, coverage usually in addition to the primary policy. Whatever the situation, your insurer should be able offer the appropriate coverage.

A Temporary Policy

Another option is getting temporary car insurance coverage. When renting a car, you can pick up a short-term policy from the rental car company. These policies can be expensive on an annualized basis. But prices are reasonable on a short-term rental – $6-12/day.

Check with your regular insurance carrier as well. A traditional insurance company typically offers better rates than rental car companies. These policies can last 1-30 days. However, not every company offers them. For convenience sake, it may be best to just go with the rental car option.

Another Option: Take out a Regular Policy

If you plan to need temporary car insurance for one month or longer, you might also consider getting a traditional policy. You are only responsible for premium while you need auto insurance. If you cancel the policy – say after 6 weeks – the insurance company is responsible for returning any premium that is due. It’s called the return of unearned premium and the state insurance boards regulates it. If you go that route, make sure you only pay for monthly car insurance.

If you need a quote for temporary auto insurance, apply here:

Temporary Car Insurance Quote

You mean I don’t have to front all that cash for my auto insurance premium?

How to pay for auto insurance every month - not once or twice a year.

Auto insurance policies are contracts that usually last for 6 months or a year. If something happens to your vehicle that is covered in the policy (aka covered peril) during that time – and you’re current with your premium – the insurance company should cover the loss.

However, just because the policy is a 6-month contract doesn’t mean you have to lay down all that cash when you sign up. Most insurers allow policyholders to pay their premiums on a monthly basis. So instead of writing a $500 check every six months, you can pay $83.33 a month, plus applicable fees. This allows you to budget your car insurance like you would your rent, electric bill, etc.

Fees Apply for Monthly Billing

There is usually a fee involved with paying premiums once a month. It can be as low as $1/month – as was the case when I worked with State Farm. Sometimes it’s higher. When Progressive quoted my policy awhile back, I mentioned in my Progressive Review they wanted an extra $70/6-months. I guess $11.67/month isn’t too bad. I just didn’t want them to take $140 out of my pocket every year just because I didn’t have the cash on hand.

You can pay monthly a few different ways – depending on your insurance company. For one, the insurer can pull out the premium from your bank account. It’s convenient since you don’t have to remember to write a check or initiate bill pay. Just remember when the draft happens so you don’t get overdrawn. You can sometimes provide a credit card for the monthly transaction as well. In addition, you can send a check every month. Finally, if you have a local agent, you can pay cash, check, or credit card– depending on their payment capabilities. Once again, the method of payment depends on the company and sometimes your local agent.

Check the Fine Print for Monthly Billing

Bottom line, most insurers allow you to pay your insurance premium every month. They also allow several methods of payment. However, make sure you read the details when you sign up. There’s usually a fee and your overall insurance cost will be higher when you’re paying for car insurance monthly. Check with your insurance company for the details. Read the fine print if there are any questions.

Important Things To Consider Before Filing A Claim

Will you have to fork over more of these if you file a claim?

So you’ve had an accident and you may need to file a claim? But you’re worried about the effects on your next renewal. Will your insurance go up or will it stay the same?

It’s a no-brainer if your premium stays the same – file the claim. But if your rates go up, isn’t that where the insurance company gets their money back? I know what you’re thinking because I ask myself the same questions.

Here are some things to think about before you make that fateful call.

Your Insurance May Go Up

As usual, each claim situation is different. The first question to ask is ‘who’s at fault?’ If you’re not at-fault, you should not be surcharged for the incident. However, companies often use claims history in their renewal calculation. Even though there’s no surcharge, there could be a hidden increase. Rating is a complicated matter and many factors play a part.

However, if you are at-fault in the accident, there’s a good chance there will be a surcharge on your next renewal – probably extending for several renewals thereafter. It’s not so much a case of the insurance company getting their money back, but more of a “friendly” reminder from your insurer that you should drive safer.

Severity Determines The Consequences

The severity of the at-fault incident determines the severity of the consequences. If you are partially at-fault for an incident, there may not be a surcharge for the event. Each insurance company is different, so that’s not a guarantee. However, if the incident is serious enough (Example: Driving drunk, causing an accident, and inflicting injuries on another person) it’s possible your policy will be non-renewed. That translates to exorbitant rates when you get a new policy.

Another thing to consider is losing accident-free discounts. If you’re currently enjoying a discount because you have not had an accident, then a claim may remove that discount. You should be able to see that discount on your policy. Claims can affect that discount and how much you pay on your next renewal.

Call Your Insurance Company

Regardless of the severity of the incident or who’s at fault, you should report all incidents to your insurance company. Accidents can get complicated very quickly. If you fail to report an incident and the other party decides to sue months later, you could have more problems. Your insurance company may question why it took so long for you to report the incident. They may even non-renew your policy.

Play it safe. If you have an accident, call your insurer or agent. If they recommend it, file a claim. After all, that’s why you bought car insurance.