Exotic cars are now a popular choice, especially amongst the younger generation. They got all the adrenaline to speed up the vehicle to the maximum limit! The biggest desire of most automotive enthusiasts is to own an exotic or luxury car. These vehicles are considered engineering marvels for a reason. They combine great on-road and off-road performance with stunning aesthetics.
However, such an investment requires proper protection to ensure the owners can drive the car without any hesitation. That’s where exotic car insurance comes into the picture. To help you make a prudent choice, we will cover the details of exotic car insurance in this blog. So, let’s dive right in.
What is Exotic Car?
Exotic cars are considered the crème de la crème of cars. They exemplify performance, interiors, design, and technology. On top of that, they’re extremely rare and pricey. It could be a Lamborghini, Porches, Ferrari, or simply any car that embodies the epitome of luxury.
The exotic car can also be a significant investment for those who want the best impression on the road. The owner or potential owner of the vehicle also needs to know about luxury vehicle insurance so they can secure their hefty investment.
What Is Exotic Car Insurance?
An exotic car insurance can equip your luxury car with all the coverage it needs to stay safe on the road or when parked. However, due to their high value, their repairs and maintenance also cost a lot, and so does their insurance. These vehicles require coverage that addresses their higher repair costs, specific risks, and market value.
High-end car insurance is generally designed to cover the security of high-value vehicles. Traditional auto insurance may not properly cover the high replacement value or specialized repairs these vehicles often require.
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This special type of high-end car insurance ensures that luxury and exotic car owners are protected against significant financial losses. These types of insurance are made to give access to experts who understand the nuances of insuring such vehicles.
Why Do You Need Exotic Car Insurance?
As a matter of fact, Luxury and Exotic vehicles need to be insured well. The following 3 major reasons why:
Unique Risks Associated with Luxury Vehicles:
Owning an exotic car is a matter of pride. This doesn’t eliminate the fact that it comes with its unique risks. The first is its higher repair cost. This is because it is a highly engineered machine, and dealing with its specialized parts requires great expertise. Additionally, exotic cars are built for great performance. This makes them more vulnerable to accidents. Even a minor one calls for a hefty bill when repaired. Most importantly, exotic cars are prized possessions worth millions. Naturally, they attract the attention of many thieves and car burglars.
Differences from Standard Auto Insurance:
Standard auto insurance policies are not designed to handle the complexities of exotic vehicles. For example:
- Normal coverages are not designed to cater to specialized vehicles. These are designed for small vehicles.
- Standard policies are not for specialized repair shops or OEM (original equipment manufacturer) parts. These can give coverage over the small damage to the parts.
Coverage Limits and Features:
Repairing this kind of vehicle needs special and experienced eyes. Plus, the parts that cannot be repaired need to change. These parts also come with a high price and they need to be covered under the repair. Exotic car insurance provides the best coverage for luxury cars.
- Agreed Value Coverage: This ensures you receive the full insurance value of your car in case of a total loss. It does not give any depreciated amount.
- Enhanced Coverage Limits: High coverage thresholds that reflect the vehicle’s market value.
- Specialized Add-Ons: Such as roadside assistance for exotic vehicles or coverage for track days.
How Much Does Exotic Car Insurance Cost?
Costs for exotic and luxury car insurance can depend on factors like the type of vehicle and the model. The price will also vary depending on the geo-location. These prices can be changed further based on the value, car maker, and the owner’s driving history.
Bear in mind that exotic cars are the most expensive category of cars (which is why they’re exotic!). According to Statista, the average price of a high-end luxury car in the United States is approximately $80,415.28. So it makes sense that the insurance policy for your exotic car can cost around thousands of dollars. According to Forbes, in America, the average cost of luxury car insurance is about $4094 per annum. The average cost can also be as high as about $37,000.
Although there are several ways through which you can bring down the premium cost by a certain margin. They are as follows:
- Installing advanced security systems.
- Bundling policies (e.g., home and auto insurance).
- Opting for higher deductibles.
- Limiting mileage and ensuring proper storage.
How to Get Exotic Car Insurance?
You can look for luxury car insurance on the internet or offline. Go through at least 5 to 6 of them, compare their offerings, and choose the one that fits the needs of your exotic car the best. You can reach out and share the details of the vehicle, like the chassis number, engine number, and performance details, with them. They will offer common coverage options along with the add-ons.
Choose the right provider based on the location; if the location is feared of theft, then it is advisable to go for a full coverage option. A luxury vehicle can be stolen easily or the working parts can also be damaged. So you need to know about the common coverage options:
Protip: For exotic cars, you can also search for the best insurance companies for luxury sports cars like the Hagerty or Chubb.
What Does Exotic Car Insurance Cover?
The offerings of exotic car insurance policies might vary depending on the company, location, and car type. But generally, most insurances cover the following:
- Collision Coverage: This provides damages for the accidents.
- Comprehensive Coverage: Protects against theft and natural disasters.
- Liability Coverage: Covers damages to others if you are involved in an accident.
- Agreed Value Coverage: This ensures the owner receives the car’s full insured value in case of a total loss.
- Full Coverage: Offers the best coverage for luxury cars by protecting against all types of risks, including non-accident-related damages.
The best insurance for exotic car providers often offers tailored coverage options for exotic cars, such as:
- Coverage for modifications and customizations.
- Policies for rare and collectible vehicles.
- Roadside assistance and transport protection.
Factors to Consider When Choosing Exotic Car Insurance Companies
When comparing the exotic car insurance policies of two or more companies, you need to factor in the following considerations:
- Customer Service: The customer service of the provider is very important. They need to answer all your questions regarding the coverage and also be available in case of further queries or help.
- Coverage Options: A good insurance provider is one that provides a wide range of coverage options, specially customized for exotic vehicles. This allows you to pick the best-suited policy for the needs of your car.
- Reputation: Do a thorough background check of the insurance provider before striking a deal. You can do so by checking out their reviews of firsthand experiences. If possible, reach out to other policyholders and get deeper insights into the provider’s credibility and service quality.
What Factors Do Insurance Providers Consider When Giving Quotes for Exotic Car Insurance?
When arriving at a quote for luxury or exotic vehicle insurance, providers assess various factors to gauge the risk and cost of insuring high-value vehicles. These factors help tailor coverage to the distinctive needs of exotic car owners:
Vehicle-Specific Factors:
- Value of the Car: A higher value means higher premiums.
- Make, Model, and Year: Rare or older models may require specialized coverage.
- Performance Features: High-performance vehicles increase risk, affecting premiums.
- Cost of Repairs: Expensive or hard-to-find parts raise repair costs.
- Safety Features: Advanced security systems can help reduce premiums.
Driver-Specific Factors:
- Driving Record: A clean record lowers costs, while accidents increase premiums.
- Age and Experience: Younger or inexperienced drivers face higher rates.
- Location: Areas with high crime rates can raise premiums.
- Usage: Cars used for occasional drives are less expensive to insure than daily drivers.
Insurance Coverage Details:
- Coverage Type: Comprehensive and collision coverage offers the most protection.
- Deductible Amount: Higher deductibles can lower premiums.
- Policy Limits: Ensure limits reflect your car’s full value.
What Are the Factors That Contribute to the High Cost of Exotic Car Insurance?
There are solid reasons why the costs of exotic car insurance are touching the sky. They are as follows:
- Rarity: If the parts are limited to the vehicle and the parts are not available then the cost of the exotic car insurance will increase.
- Performance: If the vehicle has high speeds and the performance of the vehicle is much higher than the risk is also increased.
- Repair Expertise: The repair of the parts also needs specialized technicians and they need to keep a good knowledge about the vehicle.
- Market Value Fluctuations: The market price of the vehicles can also increase, so the policies need to be maintained within limits.
Keeping Your Exotic Car in its Original Condition
A high-performance vehicle needs special treatment. Exotic cars, especially, need to run faster and one needs to pay attention to small details. Since they run so fast, these cars have a higher risk of getting hit by other vehicles or objects. However, there is no harm in trying to keep the highly-priced car in good condition. Here’s how you can do it:
- Store the car in a climate-controlled environment.
- Use specialized repair shops for maintenance.
- Avoid aftermarket modifications unless covered by the policy.
- Use a specialised tool to open the mechanical and electrical parts of the vehicle.
- Check the hydraulic oil storage and the coolant storage. If it is lower, then refill it with a specific grade.
- Use the right amount of engine oil and the grade of the oil should match the engine condition.
- Don’t go with local repair ideas; change the parts for maintenance.
Why Is a Specialized Auto Insurance Policy a Better Option?
Luxury car insurance is designed to meet the needs of luxury and exotic vehicle safety. Normal insurance only covers the small details of the vehicle and it also needs to pass a lot of paperwork. Customized insurance policies can make the deal better for the vehicle owner. These types of insurance policies help to manage the repair cost, dent parts cost, repaint of the vehicle, and all other potential threats. So it is important to have a specialized auto insurance policy for luxury and exotic vehicles.
Frequently Asked Questions:
How to find companies offering insurance for rare and high-value vehicles?
You can look for insurance companies that are trained to give high-quality attention to detail to the vehicles. Some companies also provide customizable policies to change over time according to the value of the vehicle.
What’s the best insurance for rare sports cars?
Sports cars offer more speed and the providers need to be chosen based on their ability to provide coverage for damaged parts, accidents, total loss, etc.
How to Insure Rare Sports Cars?
Choose providers with experience in high-end car insurance. Opt for agreed-value coverage. Most importantly, invest in advanced security and proper storage to reduce premiums.
