Learning about the differences between a standard auto insurance policy, and the type of policy that is necessary when insuring a classic car, will be helpful to you, so that you are aware of the limitations associated with insuring classic vehicles. First, you need to be sure that your vehicle can be truly categorized as “classic.” The classification of a classic car will differ from insurance company to insurance company, so you will need to do some research to determine what each insurer’s definition of ‘classic’ is. It is common for classic vehicles to be permitted on a standard auto insurance policy, although it is likely that insurers will charge higher premiums for this privilege. This type of policy will not give you the same advantages as specialty insurance, which offers the agreed value clause to protect you in the event of theft or an accident

It will be the present prices being offered in the market, that will determine what the average insurance company will pay you in the event that you make a claim. Deciding on the market value of a classic car is a rather intricate issue, and that is where the difficulty arises. In many cases, the insurer will end up undervaluing your motor, and if they do so you will be forced to take that amount, even if you feel that it is unfair. When it comes to classic cars, the value of a single car model can differ by 50% or as much as 500%, as the market for these types of vehicles is highly price sensitive. With the absence of an agreed value clause, a classic car that is a limited edition, is in mint condition, or has providence, will never bring an amount equal to what it is truly worth. The objective of the majority of insurance companies, is to pay you the least amount that they can, and standard insurance companies are especially known for this.

You need to realize that there will be stringent rules attached to a classic car insurance policy that incorporates an agreed value clause. For example, these policies often have an annual mileage cap, designed for classic car owners who infrequently drive their cars. Other restrictions might include adding security measures and limiting the number of classic car shows that you can take your vehicle to. The more rare and desirable your car is, the more you will have to pay, however, due to the restrictions often put in place, classic car insurance policies tend to be relatively cheap. The most important feature is the agreed value clause, and if you want to get the insurance policy that you think is best, you may need to pay higher premiums.