Insuring classic and specialty cars can be confusing for the first-time buyer, because how you cover the car depends on how you’re going to use it.

If you’ve never owned a classic before, you may not know the right questions to ask. But that’s why we are here.

Ask yourself if you would need any of these seven situations to be available from the company you insure your classic with:

• Being able to use your own mechanic for repairs
• Being insured for what you feel the car’s actually worth
• Liability insurance when participating at club events
• Coverage for damage incurred at car shows
• Insurance coverage during restoration
• Flexible premiums based on miles driven per year
• Coverage for shipment to out-of-state or overseas events 

If you answered yes to at least three of those situations, you may want to consider specialty insurance for your classic.

Specialty car insurance has been available for decades, but statistics show that fewer than half of the collector vehicles on the road today are insured by specialty programs.

That’s too bad, because most standard policies will not cover some of the risks that are unique to these vehicles.

Having said that, there could be qualifiers that need to be met for insurance through specialty programs, such as:

• You must own and use a daily driver vehicle
• The car may need to be a certain age, or older
• You may need to be a certain age, or older
• The car may only be driven 2,500 miles per year, or less
• The car may only be driven for certain activities
• The car may not be driven for commercial use

Terminology used with collector car insurers can be also be confusing, so don’t assume anything.

Ask hypothetical questions in regards to how they would handle a specific claim, such as “what would happen in the event my car was a total loss?” Each company might answer that question differently.

There are three types of automobile insurance coverage offered for the total loss of your vehicle: Actual cash value (ACV), stated value and agreed value.

ACV coverage is what insures most everyday cars and pays out a depreciated “book” value in the event of a claim; the older a car is on an ACV policy, the less value it has.

Some insurance companies offer stated value policies for collectibles. These policies are better than ACV because they allow you to “state” a value for your vehicle that is greater than its depreciated “book” value.

But, stated value can still depreciate vehicles because the policies generally require the insurance company only to pay up to the “stated” amount.

Only agreed value insurance policies guarantee you will get all of your money back in the event of a total loss.

There are varied levels of service, rates and types of coverage and claims handling with standard car insurers. The same is true with specialty car insurance companies. We can help you with researching all options so you can make a decision that is right for you.

Cost should be considered, but in our opinion, should not be the determining factor. When buying insurance you are buying a service; look for quality customer service, excellent claims handling and a knowledgeable staff who know and understand collector vehicles.

An insurance policy may only be as good as the staff that is processing your claims.