Classic car insurance works differently to standard motor insurance, and getting it wrong is an expensive mistake. Here's what you need to know.
Get an agreed value policy
Standard car insurance pays out market value at the time of a claim. For a classic car that has appreciated over years of ownership, market value is almost always less than the car is actually worth to you — and may be well below what it would cost to replace with an equivalent example.
Agreed value policies fix the payout amount upfront, agreed between you and the insurer. If the car is written off, you receive the agreed figure, not whatever a claims assessor decides the market value is. This is standard practice with specialist classic car insurers. Use one.
Use a specialist insurer
Mainstream insurers don't understand classic cars and their policies reflect that. Specialist classic car insurers — companies like Hagerty, Adrian Flux, Footman James, and others — offer policies designed for how classic cars are actually used. They understand limited mileage, agreed value, laid-up cover, and the difference between a concours-condition car and a standard road car.
Be accurate about mileage
Limited mileage policies offer better premiums in exchange for an annual mileage cap. Be realistic about what you'll drive. If you exceed the agreed mileage, your policy may be void at point of claim. Underestimating to get a lower premium isn't worth the risk.
Declare modifications correctly
Any modifications to the car — engine changes, suspension upgrades, non-standard wheels — need to be declared. Failure to disclose a modification that contributes to an accident, or that affects the vehicle's value, gives the insurer grounds to refuse a claim. Declare everything and get it confirmed in writing.
Consider laid-up cover for winter storage
If the car is off the road during winter, laid-up cover insures it against fire and theft while it's stored — at a fraction of the cost of full road cover. It also means you're not paying for road risk cover on a car that isn't moving.
Keep the car's value up to date
Classic car values change. Review your agreed value every year or two against current market prices for comparable examples. If your car has appreciated significantly, your agreed value may be out of date and you'll be underinsured. Most specialist insurers will update the agreed value on renewal.