Welcome to our FAQs page where you will find a variety of frequently asked questions which we hope will provide the answers you are looking for regarding your insurance. If you are unable to find the answers you are looking for, you are very welcome to call us Monday to Friday between 09:00 and 17:30 on 01376 574000.
There are a small number of insurance companies which have been in classic car insurance for a number of years. Equally, there are new players. Those who have been in the business longer will have built up more statistics. It is our view of that we all prefer steady rates year on year, not a yo-yo effect. None of us likes unpleasant surprises; when it comes to council tax, electricity or even insurance bills!
One last word therefore – do not be tempted by the lowest premium offered to you, particularly when the market is ultra competitive. Listen to what friends and colleagues have to say in terms of service in the event of a claim or the quality of breakdown cover which may be included. There are a number of intermediaries who have served the market well for 20 years or more and who value their reputations.
One of the major benefits of most classic car insurance policies is the fact that the value in the event of a total loss claim is agreed at the outset of the contract.
The benefit of this cannot be understated since, in the event of a total loss, the amount that the insurer will pay you is the agreed value shown on your policy schedule (less any applicable excess on the policy, which can be accommodated within the additional motor legal expenses policy available at £15 plus ipt*).*Price as at 22nd Jan 2015.
With modern cars of monocoque construction, a very badly damaged vehicle may not be allowed to go back on the road (Category ‘A’ as it is known) or is only fit for the reclamation of parts (Category ‘B’).
Vehicles built on a chassis are usually repairable unless totally destroyed/twisted by the intensity of a fire for instance. Category ‘C’ applies when it is uneconomic to repair the vehicle, i.e. the costs exceed the agreed valuation, but it is repairable, while Category ‘D’ is for routine repairs which are covered by the intrinsic value of the vehicle.
As a specialist broker we urge all our clients with classic cars to seek an agreed value – even some new cars such as Morgans or some Mercedes we will agree a value (usually annually rather than every three years, which is our regular review interval).
We can only help our clients if an agreed value is in place. If you do not have an agreed value then, in the event of a partial or total loss, the engineer will have no option but to revert to market value or with rare cars a “guestimation”. A client can always request a change to his/her valuation as a result of improvements made or as a rebuild progresses. Supporting details and fresh photographs signed and dated are, of course, essential.
Requested values for rare high value cars, in particular, need as much evidence as possible in support, often auction sales are the only source or, maybe, the marque club, if there is one.
Finally, the question comes up from time to time when a car has been the subject of a no expense spared restoration with the end value well beyond the price one would expect to pay privately or at auction. In such cases these are discussed with insurers to endeavour to agree a figure that the Insurer is prepared to underwrite, but in such cases it is then the Insurer’s decision.
Experience has shown over the years that restricted club schemes tend to have a better claims record than open market schemes and hence many schemes are able to reflect this experience in the premiums charged.
Quite apart from this, the club benefits from having established, proven schemes. Members may also find that the savings made on the discounted insurance premiums often compensate for the annual club membership fee as opposed to those offered for non- club members.
Different insurers have different dislikes. Clearly drivers with any history of drink driving, driving without insurance and dangerous driving are going to have a difficult time. Accidents where only the proposer’s car is involved, especially late at night, raise questions and if you live in many metropolitan areas the incidence of damage, accidental or deliberate, especially if the car is un-garaged is magnified.
Insurers do not like being told after the event that something has happened. If, for example, you need to increase your mileage or add another driver, talk to your broker first. Do not expose yourself to the possibility of non-disclosure. In extreme cases the insurer could decline your claim. If in doubt, ask.
The biggest threat to increased premiums in recent years has been the increasing levels of thefts. Vehicle security and lifestyle of the proposer helps the broker or intermediary to understand the risk. The higher the value of your car, say £20,000 plus, the more likely you are to be asked to fit some security – e.g. one of the Tracker systems probably being the most appropriate – particularly if you live in a metropolitan area.
The trauma of losing a treasured possession has to be worse than parting with a cheque for an appropriate deterrent! Also, do the obvious. Put your car away in the garage and lock it up when you are at home. Insurers are not impressed when they learn your car was stolen from outside your front door when you have got a perfectly good garage. If for no other reason, premiums are often lower for cars which are habitually garaged.
Firstly, where is the car being rebuilt? If the work is being carried out by a restorer on his premises, then you should ensure that the restorer has adequate motor trade insurance in the event that your car or any parts wherefrom is lost or damaged while in his ‘custody or control’ to use the terminology. You should ensure that a written and pictorial record is maintained and kept off-site so that in the event of a loss, the insurers are aware of the condition of the car immediately prior to the event.
If the rebuild is being carried out in your own garage, then an ‘off road’ policy is likely to be suitable, particularly where you do not anticipate completion within the next year. The cover given includes accidental damage – to cover objects falling from shelves or storm damaged roofs, etc. the premium is nominally quite low as there is no road risks cover. If you foresee the car being back on the road within the next year, you may be better advised to start a low mileage policy, perhaps 1500 mpa. If nothing else, when the time comes, you will be able to tax and MOT the car, take it to the trim or paint shop, or whatever. The difference in premium is small, but the convenience of only doing the basic insurance paperwork once (apart from photographs and an up to date agreed value) could be appealing.
Incidentally, when a long term rebuild is involved and considerable tranches of cash are expended, do remember to keep the value up to date by submitting photographs of progress and written evidence of work carried out – invoices, etc. otherwise you will only get paid out the value agreed previously in the event of a claim.
At PBIS all our classic car policies are offered as agreed value policies. This is a service we believe should be offered free of charge to our clients and is therefore included in the policy.
When a classic policy is taken with PBIS the client is supplied with an ‘Agreed Value Declaration Form’.
This should be completed and returned together with six photographs of the vehicle, back/front/both sides, interior & the engine bay. Photographs must be on photographic paper and all signed and dated on the reverse. The photographs should be of a sufficient size (up to A5) to be able to clearly see the vehicle in question.
In some circumstances, you may be requested to obtain an independent or Club valuation.
This is usually in the case of higher value vehicles, perhaps with provenance, or exceptional vehicles where it may not be possible to judge the true value from a set of photographs.
Occasionally the value requested may appear too low, in this instance we will discuss this with you and may suggest a higher value, which you may then choose to accept or not.
PBIS do not currently accept photographs via email. Once the value of the vehicle has been agreed the photographs will be returned and the client asked to retain these for any future requirement. Agreed values are reviewed by PBIS every 3 years.
Should a client feel the value of a vehicle has changed within the insurance period they can request the current agreed value to be reconsidered. More commonly clients tend to review their vehicle value at policy renewal.
When a classic car policy is taken out it will automatically be on a ‘market value’ basis. Once we have received the photographs/agreed value declaration form and agreed the vehicle value, this will then be updated on the policy schedule.
Clients must ensure that photographs are received by us within 14 days of the inception of the policy otherwise an administration charge may be requested.
It is important to note that if a vehicle is insured at ‘market value’ the most that our insurers will pay, in the event of a total loss claim, will be the value shown in the schedule or the actual market value, whichever is the lower.
In general terms a limited mileage classic car policy will normally have certain features that
a standard car policy will not have and vice versa. For instance, a classic car policy can be
expected to have an ‘agreed value’ stated in the schedule in the event of a total loss claim,
rather than a market value which will be open to negotiation, having regard to the market
value of that car at the time of the event giving rise to the claim.
The policy may also be restricted in the amount of miles the car is allowed to do in the course
of the year; mileages of 1500, 2000, 3000, 4000, 5000, 6000 and 7500 are offered In the market – dependant, of course, on scheme or general underwriting criteria and frequently today, as with several Club Schemes, unlimited mileages are also available with agreed value. The third most important point is that, in most cases, a no-claim bonus proof is not required to be submitted.
Limited mileage classic car insurance works on the basis that the proposer (and any named drivers) has good driving histories with a satisfactory bonus on their primary car, or a good driving record if a company owned car. The policies are therefore, what is called, ‘flat-rated’. Some schemes require the existence of a primary car for ‘everyday’ use – others do not –
a point to check – as is the facility to commute to and from work. Garaging and security
are very important.
It takes a lot of £150 premiums to pay for a £20,000 classic that has been stolen. Secure night-time garaging at the owner’s address is mandatory for some schemes, particularly for higher value cars or in ‘high-risk’ areas. Expect to pay more, therefore, for driveway or street parking.
Another difference between classic car and private insurance is that breakdown and recovery is often included in the classic policy. This may be restricted to UK only but, in many cases also includes the EU.
Private car policies, on the other hand, do not normally have mileage limitations, although with today’s quotation systems there are often premium reductions for restricting mileage. Good quality comprehensive policies normally include business use by the proposer and spouse and, of course, commuting to and from work. Business use is not always available on a limited mileage classic car policy, neither is the ‘driving other cars’ extension (albeit third party only) normally found as standard on most comprehensive policies. Whereas a ‘flat-rated’ classic car policy assumes you are ‘innocent until proved guilty’ the traditional method of assessing rates for private motorists has been via the no-claims bonus system, e.g. 1 year 30% discount, 2 years 40%, etc.
An article such as this cannot possibly cover all the minor variances in policy terms and conditions but other considerations such as the proposer’s age, location, occupation, driving record, all help to decide whether someone is eligible for a classic car policy. With the choice in the market today, it is well worth asking.
At PBIS we prefer to use the term ‘collectable car’ since this is more widely embracing. Peugeot 205s, for example are hardly classic cars in the true sense but there is an enthusiasts’ club for them and they are perfectly eligible for classic car schemes. Historically, to qualify for a classic car scheme, the car typically had to be over ten years old and desirable on the grounds of marque or pedigree, but the emergence of schemes for future classics has changed the scene considerably. The market has certainly widened to the extent that cars such as the East German Trabant are now being covered.