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Performance Insurance |
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Documentation and Appraisals: The Cornerstones of Insuring Specialty Cars
By Arthur Nichols
Owners of performance-enhanced vehicles face extra challenges in the insurance arena. It's a serious mistake to simply add a specialty car to a regular auto insurance policy. In the event of a claim, the company will pay on the depreciated Blue Book value only and you'll lose all your investment in modifications.
The best way to approach insuring a collectible or enhanced automobile is to:
1. Keep detailed documentation on all modifications as well as data on their effect on the car's operation and performance. These will be required in negotiating coverage. Remember, disclose every modification. Failure to do so gives the company the right to void coverage in the event of a claim.
2. Secure an independent appraisal from a professional appraisal service before seeking an insurance quote. Most companies only require this if your car is worth more than $40,000, but it's the only way to ensure that you know the value of the machine and that you have adequate insurance protection.
3. Investigate the coverage offered by classic car insurance companies like Hagerty, Grundy, or American Collectors Insurance. Note that they will not cover cars used for daily driving and may or may not insure cars used for racing.
Specialty insurance companies are in the business of writing unique insurance products that address a vehicle's intrinsic work while allowing for leisure driving time without penalty. They will also issue "agreed value" policies that will not depreciate the value of the vehicle over the life of the policy and that will guarantee that the owner receives full value compensation in the event of a loss. Also, be sure to ask if there are any discounts available, such as a discount for student drivers, as it never hurts to ask and you might save a few dollars in the end.
Finding a Reputable Appraiser
There are many online sources for researching qualified automotive appraisers. The Auto Appraisal Group, for instance, has a nationwide network of certified appraisers and works with owners of antique autos, classic cars, muscle cars, exotics, custom street rods, kit cars, motorcycles, and late model cars. Their appraisers are used by world famous collectors, including the Harold E. LeMay Museum in Tacoma, Washington. The group's web page (autoappraisal.com) has a location finder and a scheduling form.
By using your favorite search engine and the phrase "collectible car appraisal," you'll find more than enough information to begin looking for an appraiser in your area. If you belong to or have access to a car club or enthusiast group, they will most likely recommend someone locally. While many owners balk at the added expense of an independent appraisal, it is the only realistic way to assess the value of a vehicle against the market for its model, class, and modification level. Your insurance company may insist on ordering their own appraisal as well, however, by having your own documentation, you are in a much better position to negotiate if the two determined values vary markedly.
By keeping full and complete documentation on the vehicle, securing a reputable independent appraisal, and by dealing with companies that specialize in unique automobiles, the owners of modified specialty cars can secure insurance coverage that is both comprehensive and affordable.
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