Insuring a special vehicle is sometimes tricky since these aren’t usually used as family cars. There are quite a number of factors influence car insurance underwriting that the antique or classic car just doesn’t fit. Nonetheless, any vehicle that uses Ontario roads must have a minimum of insurance, classic or not. Here are things to consider for your situation.
How Car Insurance Premiums are Structured
Insurers consider statistical data on vehicle years, makes and models to establish insurance risk factors for each vehicle. As vehicles get older, fewer of a particular model are on the road. Statistical information falls off. When an insurer sees no data, it will assume higher risk.
Parts for older vehicles may be hard to find and expensive to buy. When an antique model does have an insurance claim, costs to repair could be well beyond those of a late model vehicle. This also drives prices up.
Classic model vehicles are often popular basis for modified vehicles. Hot rods — cars with performance enhancements — are another high risk factor for insurance companies. With these factors in place, conventional car insurance companies may refuse coverage under conventional personal auto policies.
Residual Insurance Markets
While any insurance company can refuse to insure a car based on its own underwriting rules, the car insurance industry as a whole can’t refuse a client, as long as the car meets road worthiness standards and the motorist is legally permitted to drive. When a driver can’t arrange coverage through the regular industry, they can turn to the Facility Association. All car insurance companies belong to this industry organization. The Facility Association serves the residual car insurance market, those drivers who can’t obtain insurance conventionally.
Largely, the Facility Association covers drivers with major convictions, once suspensions are ended. While it may seem strange that a classic car owner shares an insurance source with a convicted drunk driver, both belong to part of the car insurance world outside normal parameters. The Facility Association works with regular insurance companies to create special underwriting terms for the client. The Association doesn’t issue policies themselves, but rather facilitates policies on behalf of motorist and insurer.
Specialty Insurers
One drawback of the Facility Association is price. Typically their policies are expensive due to their “last resort” nature. Perhaps because of this, specialty insurance providers emerged to serve the classic and antique car markets. Companies such as Vintage Auto Insurance and Hagerty issue policies for car enthusiasts who need atypical coverage.
There are still conditions with specialty providers, though some of these conditions are precisely the opposite of those experienced with conventional insurance companies. For example, a classic car that is used as a daily vehicle would probably not qualify for a policy through a specialty provider.
There’s a quick way to check to see if your classic vehicle can be covered conventionally. Ratelab’s car insurance calculator takes only a few moments to complete. It will search through dozens of Ontario car insurance providers and if there’s one that will insure your vehicle, you’ll have the quote then and there. Insurance through the conventional car insurance market is likely the most affordable when it’s available.
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