In Part-I and Part-II of this series, you learned how pre-purchase inspections and appraisals, as well as classic car financing, can help you own the perfect "new classic" EFI GM vehicle.
In Part III, we'll be covering classic car insurance. While many enthusiasts know what it is, some still don't use it to cover their performance vehicles—especially late-model drivers like us. Many don't know about the myriad services included with a classic car insurance policy, some of which can come in handy when you actually need them.
GMHTP reached out to Hagerty Insurance, a well-known company that specializes in classic car insurance and values, to discuss insurance. Based in Traverse City, Michigan, Hagerty offers classic car insurance policies in all 50 U.S. states, Canada, and even the U.K. We did a little Q&A with Hagerty's Public Relations Manager, Jonathan Klinger, and learned a lot from his answers. Keep reading, and we're sure you'll do the same.
Full disclosure: your author is a Hagerty Insurance customer, and has used several different collector car insurance companies in the past.
What are the biggest misconceptions about collector-car insurance?
People sometimes think that collector car policies, through Hagerty, are only for high value, best of the market cars. This is simply not true. We offer coverage for a wide range of collector vehicles; from something valued at $3,500, all the way up to rare vintage Ferraris that often grab the headlines for multi-million-dollar sales.
Another popular myth is that collector car insurance is strictly for car shows and parades. While we do not want you to use your classic vehicle as a daily driver, we believe that classics are meant to be driven, and we do want you to enjoy your car. That means, in addition to car shows and other events, you are also covered for other pleasure driving, including an occasional drive to work on nice days.
These days, do most enthusiasts know about collector-car insurance?
While it is becoming more common knowledge that specialty insurance for collector vehicles exists, many people still continue to insure their classic on the same policy as their daily driven vehicles. There can be a variety of reasons that they do not have specialty insurance; including, thinking they don't qualify, thinking it is more expensive, or thinking that they cannot keep their current insurance agent.
How is collector vehicle insurance different from standard car insurance?
The main difference is that a classic car policy, from Hagerty, offers Guaranteed Value coverage, rather than the more common Actual Cash Value or Stated Value polices. Unfortunately, the classic car owner may not notice the difference until they experience a claims situation, where our Guaranteed Value policy pays out the full value that the insured and the company determined, when the policy was issued.
What questions do potential customers ask the most?
Potential customers often ask about usage or mileage limits. They are curious to know if they can still enjoy their car for Sunday cruises, or occasionally drive to work during nice weather. At Hagerty we believe classic cars are happier when they are driven, so our policies don't limit those activities.
How do you decide which vehicles and years are eligible for coverage?
The simplest way to look at this is Hagerty insures the fun car you don't have to have. This means we do not have a specific year cutoff when we look at applications, but more of how the car is used. When looking at modern vehicles, we often look for a history of collectability or a limited production for that model, in addition to its intended usage.
Are there restrictions on late-model vehicles 25 years and newer?
Concerning late model vehicles, we will ask questions on how you plan to use the vehicle, and verify that the policy holder meets our requirements of having a regular use vehicle for every driver in the household, in addition to their collector vehicle.
Are there any state-specific issues regarding collector vehicle policies?
There are a few states that have unique insurance regulations concerning classic vehicles. For instance, there are regulations in Massachusetts that prevent us from insuring cars newer than 15-years old, on a collector policy.
Are there restrictions on a collector-car insurance policy holder, like mileage caps?
Here at Hagerty, we want you to enjoy your car. There are no specific usage restrictions written into the policy. We do require proof of storage and proof of a daily use vehicle for each licensed driver in the household.
What kinds of perks do collector-car policies have?
Our Hagerty Plus roadside assistance program helps out when everything doesn't go as planned while driving your vehicle. This membership also includes a subscription to Hagerty Classic Car Magazine and membership in the Historic Vehicle Association. Also, we offer specialized policies for Automobilia (i.e., vintage gas pumps), and vehicles that are still under construction or undergoing restoration.
How do you determine a classic vehicle's value?
We have a team of experts who can help determine the value a vehicle, based on our large database of auction sales, private sales, and also comparable cars we have insured. We work with the customer to help determine the value of the vehicle for their policy.
Does your company require or recommend an appraisal?
We typically do not require appraisals. If the vehicle is of such rarity that we cannot substantiate the value the customer is requesting, or if the vehicle is significantly modified, we may request a third party appraiser look at the vehicle to ensure the customer is happy with the value placed on the vehicle.
How does agreed value work?
Hagerty exclusively calls this "Guaranteed Value." Hagerty will guarantee the dollar amount they would like their vehicle insured at the time of application. In the event of a total loss, that amount they set is the amount they receive.