A legend of your own

INSPIRED by the glamour of James Bond's Aston Martin DB5 or the sophistication of Inspector Morse's well-kept Jaguar, more people are driving classic cars.

While classics may demand a lot of care and attention, many are surprisingly affordable. Gone are the boom years of the 1980s when City bankers bought classics for their investment value and an E-type could cost as much as pounds 100,000.

Today you are likely to pay a more sensible price of between pounds 35,000 and pounds 40,000 for an E-type. A good Lotus Elan Sprint will set you back upwards of pounds 14,000 and a Jensen Interceptor about pounds 12,000.

And the good news is that classic car insurance is very affordable, and there is a good choice of insurers.

The term "classic car" means different things to different people. Most insurers define classics as cars older than 20 years, although there is a growing market for what are termed "future classics" - cars more than 10 years old that are likely to be collectable.

Classic car insurance is generally bought from specialist insurance brokers, or through owners' clubs.

If you trawl through the pages of any of the classic car magazines, you will see advertisements for insurance specialists, including Footman James, Firebond, Lancaster Insurance Services and Peter Best Insurance Services.

Premiums for classic cars are usually quite low because of the good claims record associated with enthusiasts - Prestige Insurance services boasts that its premiums start at just pounds 50. However, in order to qualify for cover, there are usually restrictions and conditions placed on car owners. Many insurers are not keen on young drivers with classic cars. Peter Best, the business development director at Peter Best Insurance Brokers, says: "Many classic car policies start at 21, and it is also common for insurers not to offer cover for people under 25. With high-performance cars, such as an MG RV8, you might not get insurance unless you are over 30." Both Norwich Union and Independent Insurance have a minimum age of 25. However, lower age thresholds are available: Firebond's cover starts at 20 and Footman James at 17.

Agreed mileage limits are another key feature of classic car cover. The less you drive in a year, the cheaper the premium. Most policies have set maximum mileage limits. For example, Independent's are 2,000 and 4,000 miles, and Prestige's are 1,500, 3,000, 4,500 and 5,000 miles.

Footman James goes up to 7,500 and will cover unlimited mileage on a bespoke basis.

As well as specifying the maximum number of miles you are going to drive, you will also have to agree the value of the car when the policy is taken out. This is very much in the owner's interest as it ensures that the car is covered at its true market value and it will also take into account any restoration work that may have been done to the vehicle.

Most insurers will require some form of proof of the car's value. This will usually involve completing a self-evaluation form and providing photographs of the front and sides of the vehicle. For higher value cars - pounds 10,000 to pounds 15,000 - the insurer may require an independent valuation from a dealer or possibly a classic car club. Valuations take into account factors such as past ownership (a celebrity would increase the value), year of make, number of vehicles produced, whether the car is a limited edition and originality of the model.

You need to check the agreed-value section of the policy carefully, as variations do occur. For example, Firebond has a contract that allows for the value of the car to increase over the summer months - the most popular time of year for classics to change hands. And Footman James requires no proof of value where the driver is over the age of 30 and the car is worth less than pounds 10,000.

The other common conditions of cover are that the car is put in a garage and that the owner has another vehicle that is his or her main form of transport. However, as more city-dwelling twenty-somethings take to classic cars, the market is becoming a little more flexible on these restrictions.

For example, for a twenty-something with a pounds 5,000 MG as his or her only car, with limited mileage of between 3,000 and 5,000 miles, Peter Best Insurance Services would quote less than pounds 100 for a fully comprehensive cover.

For those looking to spend their spare time restoring an old car, the best policy is what is termed "laid-up" cover. This will insure the vehicle for theft and damage while it is being worked on but will not cover it for road use.

Premiums for this type of policy are typically low, Norwich Union charges pounds 60 as long as the vehicle is pre-1982. With so much cover on the market, classic owners are well advised to look for policies that have extra features.

Footman James throws in roadside assistance and personal accident insurance, which includes cover against road-rage attacks. Independent Insurance policies include spare parts cover up to pounds 250. This is a useful extra as household policies will not cover parts stored in a garage.

You may also be able to take a higher excess in exchange for a premium discount, although most policies have a fixed pounds 100 deductible. Norwich Union is unusual in offering a 10 per cent discount for fitting an approved security system. Most insurers will require only an immobiliser to be fitted on cars valued at more than pounds 20,000.

However, don't expect to build up a nice no-claims bonus with a classic policy as most contracts are flat-rated and do not take into account the driver's claims history.

While many classic cars are now very affordable and there is plenty of cheap insurance on the market, it is not all plain sailing for classic enthusiasts. As from 1 January 2000, the European Union Auto Oil Directive comes into force, which will in effect ban lead in petrol in EU countries. This is bad news for classic cars as many cannot run on lead-free petrol.

The classic car lobby has gained a concession from Europe - 5 per cent of total petrol sales can be leaded fuel, but sold only from specialist outlets. But most classic car owners will have to get used to lead replacement fuel.

Tim Collison is editor of 'Professional Broking' magazine

specialists

Lancaster Insurance Services, 01480 484 848

Peter Best Insurance Services, 01376 573033

Cherished Car Underwriting Agency, 0181 385 0480

Prestige Insurance, 0181 941 8099

Firebond, 01223 566020

Footman James, 0121 561 4196

Adrian Flux, 01553 774477

Hastings Direct, 0800 00 1066

Norwich Union, 01603 622200

Independent Insurance, 01732 865211.