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Eightfold Increase In Some Classic Car Values

By raccars Published

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It has become clear in the last few years that classic cars are becoming a worthwhile investment prospect. But a report, by the Historic Automobile Group, has shown that in fact some classic owners risk losing money on their cars in the event of an insurance claim, by underestimating how much their car has gained in value.

Classic cars, defined by a number of insurers as those at least 20 years old, have soared in value in the last ten years, meaning that many owners have unknowingly undervalued their vehicle for its insurance policy.

It's not only high profile, premium brand classics, such as Bentleys, Bugattis and Porsches, from the sixties to eighties that have found demand increasing to the extent that their values have gone up, potentially eightfold, since 2004. Mass market classics are also seeing a run on demand - Ford Fiestas and Sierras, Toyota MR2s and Volkswagen Golfs, for example, are becoming cult favourites and have seen prices soar.

An early Eighties Mk3 Ford Escort that fetched £3,500 ten years ago could sell for £8,000 today in good condition, while the same car in prime condition and with low mileage, could potentially be worth £25,000. 1960s era Fiat 500s could be found for £400 at the turn of the Millennium but could, in the right condition, be worth ten times that amount now.

However, those who bought these cars years ago may still be automatically insuring them for the same replacement value that they originally paid, unaware how much the vehicle could be worth today. Should the car be damaged or stolen, their insurance provider is unlikely to pay out the real value of the car in present day terms. While some insurers will pay a percentage of a claim in these circumstances, some will refuse to pay out at all. Classic car owners are therefore advised to spend a little time researching current market values, before renewing their vehicle's insurance policy.

The same applies to those who may have undiscovered gems sitting in the garage, unused for decades - that old banger left by their grandfather could now provide their pension fund.

Make sure you investigate the possibility of a specialist classic car insurance policy, if your car is 20 or more years old, as these tend to be cheaper than standard policies, based upon the premise that such vehicles will be used less often and better maintained than every day cars. Be aware, however, that such policies can include limited mileage clauses.

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