Insurance deals make classic cars come to life

PUBLISHED : Friday, 17 July, 2009, 12:00am
UPDATED : Friday, 17 July, 2009, 12:00am

The dream of owning a classic car can be a frustrating one because the costs can prove prohibitive.

But there is a range of niche insurance products that can bring that dream of driving a 1962 Austin-Healey Sprite or Jaguar E-Type a little closer.

These products soften the impact of a classic car on your wallet and are tailored to the specific needs of this community.

'The general rule with motor insurance is that older cars attract a loading cost. And classic cars tend to be sporty or open-top cars which result in even higher premiums. So it can be costly when you consider that you typically only take these cars out once in a while for a drive on the weekend,' said Andy Brooks, a director at M.G. Geraghty Insurance Brokers.

'This is where classic car insurance comes in. These policies recognise that classic cars aren't going to be used every day, which means less risk for insurance companies and a cheaper price at the end of the day.'

The products offer the same options as standard car insurance, including third-party, third-party with fire and theft, and comprehensive insurance.

They differ in that they limit the amount of mileage that can be done, typically between 1,000 and 5,000 miles (1,609km and 8,045km) annually, depending on the policy.

The costs rise incrementally if drivers exceed these limitations.

In addition, many classic cars have been restored from the ground up, and have low mileage on the clock, a fact that many of these policies reflect in their premiums.

General price comparisons are tricky when looking at comprehensive insurance because of the number of factors and options in the package. But, according to Mr Brooks, classic car policies offer a cost saving of between 30 and 60 per cent on the basic third-party-only premium.

The only catch, though it is a small one, is that classic car owners need to be a member of one of Hong Kong's classic car clubs to qualify.

Elton Lau, chairman of the Classic Car Club of Hong Kong, said: 'To become a member of our club all you have to do is own a car that is more than 20 years old. In fact you don't even need to have a classic car provided you can show you're an enthusiast of old cars.'

And, with one-off fees of HK$500 and an annual membership contribution of HK$300, the proposition of being involved in classic cars has attracted more than 500 members and 700 cars in Hong Kong - a membership that Mr Lau believes will continue to grow as classic car ownership becomes more affordable.