Most auto insurance can and should be handled by major insurers, but there are times when you should consider a specialized insurance company. Classic cars, also known as automobiles, are outside of the experience of a typical insurance agent. Imported cars are another example of vehicles that most domestic agents are not well equipped to drive. For example, they may not be informed about the local availability of spare parts or whether the vehicle is a gray or parallel import. Of course, any of these facts can be investigated by a less experienced agent, but get a much better premium from professionals who know the true value of your car.
Whether or not you should get import car insurance from a specialist will largely depend on whether your car is gray or parallel import. Gray imports are cars made expressly for sale in their respective market, so when imported they are unlikely to conform to national regulations. This is not always a responsibility. Japanese imports are generally made to higher specifications than cars made in most other countries. Parallel imports are designed in a foreign country and often manufactured in that country, but they also have local distributors for both the vehicles and their parts. To keep your premiums to a minimum, try to avoid making modifications on import.
Auto insurance purchased from a specialist will almost always have a better long-term value, especially when it’s time to file a claim. Most auto insurance policies are based on the actual cash value of the car, which includes depreciation. This makes sense for new cars, but not for old cars that really increase in value over time.
Since specialists have a deeper understanding of the value of a classic car, you have an advantage if you base your insurance policy on the agreed value rather than the actual cash value. Not only will you avoid being held up for depreciation when you file a claim, but you won’t have to pay a deductible. Another option is to insure for declared value, which means that you are compensated for the amount you claim the car is worth at the time the policy first takes effect. While this makes more sense than insuring actual value, you still have to deal with depreciation and deductibles on declared value policies, so it is best to opt for a plan that is based on declared value.
