Photos by the author and courtesy of Grundy and Heacock.
We’ve all heard such inspirational proverbs as “Whenever one door closes, another one opens,” and “Every cloud has a silver lining.” While completely overused, there is some truth to them–and since today’s economy is harder than a coffin nail, a little bit of optimism never hurts.
Without going completely overboard on catchy phrases, I’ll throw out one more: “Necessity is the mother of invention.” This one is particularly applicable these days, as collector-car owners are trying to invent ways to keep vehicle costs down, while still holding onto those other pretty important items like a place to live and food to eat! In this down market, the collector-car insurance industry has been flooded with new customers. Whether they were unaware that specialized coverage existed, unsure of how it worked, or unknowing about how affordable it can be, long-time policyholders are leaving the standard companies in droves. And the best part? They’re saving a lot of dough–while in many cases, getting better coverage for their prized four-wheel possessions if the unthinkable should happen. If that’s not a silver lining, I don’t know what is.
Of all of our “How To Buy A Classic” installments, collector-car insurance is probably the most well-known subject. However, the above example illustrates that there are still those who don’t know the benefits. To shed some light on it, I contacted two collector vehicle insurance experts: Stacey Heacock, the national sales manager of Heacock Classic Car Insurance, and Chuck Wasoski, vice president of Grundy Worldwide, and asked them some of the questions that you might.
And one more thing: I’ve had collector insurance for around seven years now, and have found it to be a flexible and easy alternative to standard insurance–as long as you pay attention to the differences and stay within each particular company’s limitations. And if I were to add up the savings compared to standard New Jersey and New York City insurance premiums, I’ve saved over 10 grand over that time. Continue reading and save yourself some cash!
AutoTrader Classics: Thanks for speaking with us. What are the biggest misconceptions that people have about collector car insurance?
Stacey Heacock: That it will be more expensive, or that their vehicles wouldn’t qualify. With Heacock’s program, the premiums can be up to half compared to a standard insurance policy–it’s a pretty big cost savings. And as long as a vehicle is deemed a modern classic, used in the spirit of our program, we can insure a brand-new vehicle.
Chuck Wasoski: That it must be expensive–it is actually fairly cheap due to the usage limitations. Also many think that they will have a mileage limitation, but Grundy doesn’t.
ATC: What questions do potential customers ask the most?
Stacey Heacock: The biggest one is, is it going to save them money. Then there’s the choosing a repair shop, usage, and mileage limits.
Chuck Wasoski: How long have you been in business, do you have a mileage restriction, how is the claim service, and how can I drive my car.
ATC: What is the main difference between standard vehicle insurance and collector car insurance?
Stacey Heacock: The type of coverage comes down to agreed value versus actual cash value. With collector car insurance, at the time of the loss the agreed value listed on the declarations page would be the amount paid if the vehicle is totaled or stolen. A standard policy goes by what a depreciated value would be.
Chuck Wasoski: The main difference is agreed value. Standard auto insurance won’t cover a vehicle on agreed value, it will be an actual cash value policy, usually with a deductible, and with a much higher premium.
ATC: How do you decide which vehicles and years are eligible for coverage?
Stacey Heacock: As long as it is a collectible vehicle, kept and used within the spirit of the program, it is eligible. Comparables and current market value is used; low-dollar vehicles and trucks less than 25 years old usually don’t qualify.
Chuck Wasoski: Except for two states, we don’t have an age restriction. The vehicle must have some type of collector status, and the potential for appreciating value. This does extend to new or newer vehicles as well. Take a 1990 Mustang–we’ll do a 5.0 but won’t do a four-cylinder.
ATC: What are the main components of collector car insurance coverage?
Stacey Heacock: They are essentially the same as a regular policy: a zero deductible on comprehensive and collision, and state-required liability, uninsured motorist, and personal injury protection.
Chuck Wasoski: Liability coverage is basically the same, it is governed by the states. There is also medical, uninsured, and physical damage coverage. The physical damage coverage is what’s different compared to a standard policy.
ATC: How is the premium determined?
Stacey Heacock: The premium is cut into two portions: collision and comprehensive coverage, and liability, uninsured, and personal injury protection. With Heacock’s policy, the second portion is only charged once, no matter how many vehicles are on a policy.
Chuck Wasoski: How Grundy does it is based on the year of the vehicle, and the vehicle’s value. If customer says it is worth X, Grundy looks into it and discusses with the customer, then we agree on a value to determine the price.
ATC: How do you determine a classic vehicle’s value?
Stacey Heacock: Guide books, comparables, bills of sale, and a comparative appraisal.
Chuck Wasoski: We review the application and photos, and research it. A lot of times folks only send exterior shots–we ask that they send in more, like engine shots, interior, etc. With these types of cars, the engine can make a huge difference!
ATC: How does agreed value work?
Stacey Heacock: Once the owner gets in touch with us, dialog starts with the year/make/model, and the owner mentions how much they think the vehicle is worth. We look for current market value through the guidebooks and the comparables. We try to give a preliminary quote up front, then once the state-required forms, photos, and payment are sent in, 36-48 hours is all it takes to get the policy bound and processed.
Chuck Wasoski: Agreed value is the most important part of the whole collector car policy. Basically, it is a determined, up-front value. If there’s a total loss, it’s guaranteed back to you, and that’s the key.
ATC: Does your company require or recommend an appraisal?
Stacey Heacock: In most cases, no appraisal is required.
Chuck Wasoski: The only time we ask about an appraisal is if the value is much higher than the comparables, or if the significance of a vehicle might require one.
ATC: What restrictions would a collector car insurance policyholder have compared to standard insurance?
Stacey Heacock: Mileage–we have three mileage programs available now: 1,000, 3,000, and 6,000-mile programs. They must have a permanent, locked garage, and the vehicle must be used for pleasure use only. We encourage pleasure use: as long as it stays within the mileage, it is covered. No one under 25 is allowed to participate.
Chuck Wasoski: We tell people club and hobby use: pleasure rides, not daily transportation. We want it garaged, and don’t want it driven as daily car. But we also say that if they occasionally want to take it to work, that’s fine.
ATC: How does coverage work when a vehicle is in transit: at a hotel or a repair shop, being transported, being test-driven before a sale, etc.?
Stacey Heacock: It is totally covered as if it were a jaunt to the park for a car show.
Chuck Wasoski: It is fully covered.
ATC: Are there any states that have specific issues regarding collector vehicle policies that potential customers should know about?
Stacey Heacock: Heacock doesn’t have the ability to write vehicles under 25 years old in North Carolina. Coverage isn’t offered in Massachusetts. Insurance is ruled by state regulations, so it is on a state-by-state basis otherwise.
Chuck Wasoski: Some states require that vehicles be 25 years old or older, and some are 15 and older. Our reps can help customers with their state-specific questions.
ATC: What are some of your company’s lesser-known policy perks?
Stacey Heacock: We have spare parts coverage built into the policy–if the customer has $1,000 of parts in their garage or the trunk, that’s included! Roadside assistance reimbursement up to $200 is in every policy. The customer can select whatever repair shop they want. We have $50,000 coverage for newly acquired cars for the first 14 days while the car is in transit.
Chuck Wasoski: Auto show medical reimbursement: if you are attending a car event and something happens to you medically, we’ll pay up to $5,000 per person or $10,000 per occurrence for any medical bills. Trip interruption: if you are attending an event 100 miles from home, your vehicle breaks down, and you can’t get it repaired until the next day, we’ll reimburse you for transportation/lodging/meals until you can get it fixed. There’s a towing/labor reimbursement of $250, an inflation guard of four percent each year, and automatic purchase-price coverage for newly acquired vehicles for 14-30 days, depending on state.
ATC: What are the biggest decisions that an owner must make when applying for a policy?
Stacey Heacock: How they will get to and from work, where they will store the vehicle, what kind of mileage they need, and who will be the drivers.
Chuck Wasoski: Making sure the company offers agreed value. Verifying that they have a strong underwriting company–they can research this with AM Best guides. Making sure they get the right coverage, and of course, price.
ATC: Why do you think that your company’s coverage is a great choice for potential buyers, and why?
Stacey Heacock: We are hobbyists, we support the hobby, and we are all car lovers. We’ll be there for them.
Chuck Wasoski: A+ rated, agreed value, zero deductible, unlimited mileage, policy perks, excellent claim service, and a low rate. We want people to know that the main thing to consider when they are looking for coverage is that they have their hearts and souls in these cars–you want to be sure you get that back.
400 Horsham Road/P.O. Box 1957
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