Picking The Best Insurance For Classic Cars

A good classic car insurance policy is worth its weight in gold. This is a lesson I learned firsthand at the end of my fifteen-month ownership of a 1959 Triumph TR-3.

Years ago I was living in Houston when an acquaintance needed quick cash for taxes, so he offered me his running TR-3 for $4,000. Since I had recently sold a particularly worn-out 1968 Triumph TR-250 for $5,200, I couldn’t pass it up.

I drove it, warts and all, for the first year to see if I enjoyed the car before spending time and money restoring it. I loved the roadster’s low-slung body with cut-down doors, enabling me to touch the ground while holding the thin-rimmed steering wheel or flipping the ultra-short-throw shifter.

So I began ordering restoration parts that January. The car was painted Triumph Powder Blue in February. March saw all new chrome go on. In April, I restored the rear suspension. In May, a performance front suspension went in.

On June 3rd, I took it for its first fully “restored” drive. One week and eighteen miles later, Tropical Storm Allison hit Houston.

For those with short memories, Tropical Storm Allison was a disaster of biblical proportions. Roads and tunnels filled-up like swimming pools forcing families to rooftops. I watched the water rise to within two inches of the door threshold on my rental pier-and-beam home sitting 26 inches off of the ground. Unfortunately, my detached garage was at ground level.

As the sun rose and water receded, I was left with a waterlogged little British car, its lubricants in slicks all around the garage and driveway.

Many issues come into play with a car like the Triumph immersed in two feet of polluted floodwater. Triumphs, like most cars made before the 1980s, are very prone to rust. Any moisture trapped behind any body panel is a disaster in waiting (especially in hot and humid Houston, where nothing dries on its own.) Second, old OEM-spec gaskets are not nearly adequate to keep fluids from dripping out, much less keep external filthy water from getting in. Third, when exposed to sewage-contaminated water and humidity wool carpet shrinks and seat cushions immediately grow more bacteria than a month-old rib-eye steak. Finally, there’s the “Prince of Darkness” issue -- old electrical wiring, connectors and components on older cars are notorious for failing in even the driest climates.

Needless to say, my Triumph needed more than just a quick oil change and hose-off effort to survive. So I called my insurance company to make a claim.

I had chosen “agreed value coverage” through American Collectors Insurance, one of the large collector car insurance companies along with competitors Grundy Worldwide and Hagerty. Unlike standard auto insurance companies that base vehicle value on a secret low book value at the time of a claim (seemingly lower than the value on which premiums are based,) collector car insurance companies agree to your vehicle’s value, often without appraisal, at the get-go and actually increase the value of your car each year.

Agreed value coverage for collector cars also usually costs less than one-third of a standard insurance policy, because collector cars statistically cover fewer miles, are less likely to be involved in accidents and are generally parked where they won’t get dinged or stolen. To get these benefits, owners agree to keep vehicles stored in a locked garage and never utilize vehicles for primary transportation. Some companies also stipulate a maximum annual mileage. None of the companies will allow a driver under 25 years old to operate the vehicle.

What's even better is that a policy holder only pays once for liability coverage, so adding additional classics can be as cheap as $40 per year.

The claim process with American Collectors and its contracted appraiser was a dream. The appraiser, who had already visited many flooded classics that day, was well versed on Triumphs, remarking about the car’s robust tractor-derived engine, tendency for rust and dismal electrics.

The determination whether or not to "total" the car is simple with agreed value policies. The adjuster simply calculates the cost to restore as a percentage of the agreed value. If the cost to restore is more than a specific percentage of value, usually 85 to 90, the car is totaled, and a check for the agreed value is sent. And because these companies understand the blood, sweat and tears that go into restorations, they often go a little above the percentage to save a beloved classic.

In my claim repair costs were below the total-percentage, so a no-strings-attached check was immediately mailed. To my delight, the amount far exceeded the service cost estimates I had figured.

Since I was already in process of moving to the Northwest, I didn’t have the heart or the time to restore the car again, so I sold it “as-is”. I almost immediately began to miss the little blue roadster.

Thanks to my agreed value insurance policy, I was able to buy a totally restored TR3. Signal Red this time!

published 2 years ago

sbarer

229 points