What Is Classic Car Insurance and Is It Necessary?

Insurance companies view classic cars as different from everyday road cars. Classic cars appreciate as new cars depreciate off the lot. Typically, an insurance company considers a car that is currently worth more than its original MSRP as collectible, and possibly eligible for classic car insurance coverage. 

How Old Does a Car Have to be for Classic Insurance?

classic chevrolet corvette in russia outside
Chevrolet Corvette | Artyom Geodakyan\TASS via Getty Images

The Insurance Information Institute (III) stipulates a car must be at least 25-30 years old to be considered a classic car. Assuming the car falls into that age group, hotrods and modified vehicles qualify, as well as muscle cars and classic trucks. Classic exotic cars also fall under this coverage. 

What Cars are Eligible for Classic Coverage? 

vintage fire truck at parade
Antique Fire Truck | Paul Weaver/SOPA Images/LightRocket via Getty Images

Unfortunately the car’s age and class are only half the battle of qualifying for classic car insurance. Cars must meet specific criteria in order to reap the benefits. For instance, insurance providers may deny coverage if the owner uses the car for commuting. It may also have mileage restrictions. Although, limited use may include driving to car shows. 

Owners may need a proper storage area, like a garage or private storage unit. Most insurance companies even prefer a clean driving record as well. 

How Much Does Classic Car Insurance Cost? 

ferrari 250 gto
Ferrari 250 GTO (Left) | Photo by Martyn Lucy/Getty Images

Classic car insurance coverage costs depend on the provider. Hagerty as one of the most famous classic car insurers claims its rates fall 36-percent short of normal road car insurance. Its policies allow unlimited mileage, guaranteed value coverage, and full complimentary roadside assistance. It will also help track down parts. Where Hagerty will cover the car for the agreed-upon value after an accident, typical car insurance will only cover the value determined after the accident.

Geico customizes its client’s policies based on the year, make, and model. Geico offers the same coverage as Hagerty, and even covers up to $500 in spare parts, which is fairly standard. It also offers storage and transport for damaged vehicles.

American Modern offers $2,000 in spare parts coverage, flexible mileage, and will insure just about any kind of vehicle. American Modern is also offered through Geico.

What are the Benefits of Classic Car Insurance?

battered classic 1969 lamborghini miura p400 s
1969 Lamborghini Miura P400 S | John Keeble/Getty Images

In a word, yes, classic car insurance is better than common road car insurance. It’s cheaper and provides a number of services which otherwise wouldn’t be available. The amount it covers is based on the car’s value as set by the owner, no questions asked. 

Classic car insurance includes all the coverage of a common road car policy, plus some attractive perks. Classic car insurance covers the value of the car, agreed upon between the insurer and owner. In the event the car is totaled, the insurer will cover that agreed value, without considering depreciation.

classic porsche 356 at shopping mall
Porsche 356 | Photo by Artur Widak/NurPhoto

Classic car insurance is necessary, but not crucial. In the event a driver doesn’t qualify because of their record, a classic car can still be insured under a common policy. However, the drawback to this method is a common policy calculates based on age, mileage, and depreciation. Depending on the car, these parameters may decrease the amount of coverage that’s available with classic car insurance. Regardless, it never hurts to ask, and it’s never too late to buy.

RELATED: Hagerty’s 10 Future Classics to Buy Right Now