Insurance companies set classic car insurance costs the same way they do for more recent models--by assessing risk. Actuaries look at statistics on repair, replacement, safety and usage to determine auto insurance rates. For classic and collectible vehicles, a number of unique factors can affect risk, which, in turn, influences auto insurance rates.
When you wreck your late-model pickup truck, the repair shop orders parts from a warehouse--assuming there are none on hand. For classic cars, the dwindling supply of parts can make repairs much more expensive, or even require custom machining. Repairs that are more expensive affect classic car insurance premiums.
Safety features and requirements evolve with every new line of production. Since they are older, many classic cars lack safety features taken for granted today--features such as crumple zones, air bags, performance brakes, power steering and even seat belts. Driving cars without these safety features increases the risk of serious injury in a crash, which can also affect auto insurance rates.
A large part of the value--and thus the risk for insuring--of a classic car lies in its collectibility, which can be an unpredictable force. Supply, age and the vehicle's condition all help to determine value, but so do "wild cards" like the appearance of a specific model in a popular movie or the simple collective tastes of the market. This unpredictability affects the amount of risk a company takes on when setting auto insurance rates for your classic or antique car.
Because of the unique factors involved in setting classic car insurance premiums, a number of specialty car insurance companies focus exclusively on insuring classic and other non-standard vehicles. These insurers are usually better equipped than your everyday insurer to deal with the specialized issues that come with classic car insurance and ownership, and their insurance premiums are often quite affordable. However, this specialty car insurance usually comes with restrictions, such as limits on annual mileage, so be sure that you review your policy before you buy.