Finding Insurance for Weekend, Rare or Specialty Cars
You may have a vehicle that you do not drive much. For example, if you own a second home, you may keep an old vehicle there simply for running errands but never use that car or truck as part of your “normal” life. You may own a rare or specialty vehicle that you do not want to drive because it would decrease the value of the car. In these cases, you may need auto insurance coverage that will protect you and your vehicle but not a policy that provides the level of protection you need for your “everyday” cars and trucks.
Liability vs. Damage
Your present car insurance policy on the vehicle you drive every day may include two different types of coverage: liability and damage. Each type of coverage pays a specific type of compensation if you are involved in an accident or if disaster strikes.
Liability coverage is required by states in minimum amounts and covers you if you hit someone else or cause an accident. Liability insurance protects your personal assets from seizure by providing a substantial amount of coverage if you get sued due to your negligence or actions in a car accident. Many people double or triple the amount of liability coverage they carry if they have substantial personal assets. If you are the victim of a car accident, you will likely make a claim on the other driver’s liability insurance rather than your own. You may also carry uninsured motorist coverage, a form of liability that protects you if the other driver has no insurance.
Damage coverage, on the other hand, protects you from events that may or may not be your fault. It pays for the damage to your vehicle and losses from events other than an accident. Collision coverage pays to repair your vehicle while comprehensive coverage pays for events like theft, fire and glass breakage.
Do I Need Coverage On My Second Vehicle?
When it comes to liability coverage, there is no question that you need to be covered against any events that could place you in a position of exposure for every vehicle you own. If your second vehicle is on the road at all, your state may require you to insure it, even if you only drive it once a year. If your car is stored year-round, you still need liability coverage in case of a “freak accident” in which someone is injured.
Damage coverage, on the other hand, is within your discretion. If you never drive your second car, you may not see the need to pay for expensive collision coverage. Comprehensive coverage may be a good choice, however, in case there is a fire in your storage area or in case the car is stolen.
How Can I Find Cheap Second Car Coverage?
Finding insurance coverage for a second car does not have to mean doubling your current car insurance premiums. Most companies are willing to work with you to design an inexpensive coverage policy for your second vehicle.
Insurance companies base premiums on perceived risk. A car that is parked most of the time poses little risk of a claim, so policies should be relatively inexpensive.
There are three types of policies generally held on second or specialty vehicles. The first is a regular insurance policy that is simply scaled back to account for the smaller number of miles a secondary vehicle is driven every year. A vacation-home car might be insured with the same type of policy as your primary vehicle but may not cost as much since you do not drive it very often. Many of these policies have increasing rates as mileage driven each year increases.
Another type of policy often taken out on secondary or specialty vehicles is the limited mileage policy. This type of policy, often called a “storage” policy, states that the vehicle is usually in storage but may allow you a very small amount of mileage in order to move the vehicle periodically. If you go over the small allotted mileage on one of these policies, the company may convert the policy to standard insurance coverage.
Finally, there are specialty car insurance policies offered by some companies that the insurer and the owner design together. The owner proposes a value for the vehicle and the insurance company sells a policy based on that value. This is useful when the owner has a specialty car that would be difficult if not impossible to replace, such as a car that has been restored or modified.
With some research, second-car owners can find policies that suit their needs at reasonable prices for their extra vehicles.