What you need to know about insurance for your classic car

Classic car insurance differs from standard auto insurance in several important ways. Owners of vintage and collector vehicles—such as a Ford Mustang or a VW Beetle—face higher repair costs, unique risks, and valuation issues that a regular policy may not cover completely.

Auto insurance for older prized models takes into account how often you drive your car, where you store it, and whether its value is agreed upon in advance.

This guide explains how vehicle insurance for iconic, collector models works in Canada, what qualifies under this label, and how to choose the right insurance based on how you use your vehicle.

Can I insure a vintage car similar to a regular car in Canada?

Vintage cars in Canada typically cannot be insured in the same way as regular cars because standard policies assume depreciation, while classic vehicles often retain or increase in value.

These cars also cost more to repair and restore, requiring sourcing rare parts and many hours of high-end labour. This makes them a poor fit for traditional auto insurance.

As an antique car owner, the biggest risk you face is getting underpaid after filing a claim for an accident. If you have a regular auto insurance policy, your payout could be based on the depreciated value of your iconic car, not what it's actually worth. As a result, you'll have to cover the shortfall out of pocket.

Read more: What changes do you have to notify your auto insurance company about?

What qualifies as a classic car for insurance in Canada?

In Canada, a classic car typically qualifies based on age, condition, originality, and collector interest, though criteria vary by insurer. However, there are a few common factors:

• Vehicle age: usually between 15 and 30 years
• Condition and originality: must be well-maintained, preserved, or restored to its original condition
• Rarity or collector interest: models with limited production, historical significance, or enduring collector appeal

Some insurance providers consider modifications or custom work when determining whether to underwrite a vehicle as a period car.

Read next: Does asking about an accident affect your auto insurance policy?

How do insurance companies in Canada determine the value of a classic car?

Insurance companies in Canada determine a classic car’s worth through professional appraisal and agreed value policies rather than depreciation-based methods.

With a standard policy, your payout is based on the actual cash value (ACV) of your car. ACV is calculated as the amount required to replace or repair the vehicle minus depreciation.

That approach doesn't work well for an antique car since this type of vehicle tends to appreciate over time, or at least retain, its value. Many insurance companies offer agreed value instead. Under this type of policy, you and your insurance provider agree to the car's value upfront. In the event of a claim, you're guaranteed to receive this amount with no deduction for depreciation.

Insurance companies rely on a professional appraisal to assess the value of vintage cars. Experts evaluate a vehicle's condition, make, model, originality, collectability, rarity, and market demand. They also use special valuation tools.

Proper documentation is vital in the valuation process, so be sure to provide your insurance company with detailed photos of your vehicle, restoration records, and receipts for parts. That way, you can negotiate a fair value for your specialty car and avoid unpleasant surprises when filing a claim.

Learn more: Do convertibles cost more to insure than regular vehicles?

What classic car insurance options exist in Canada based on usage?

In Canada, classic car insurance options vary depending on how often and for what purpose you drive the vehicle. This can include limited-use scenarios such as car shows, exhibitions, or parades, where the vehicle is driven occasionally rather than used for everyday transportation.

Who qualifies for classic car insurance, and what are the restrictions?

Most insurance providers look for the following eligibility criteria for drivers of antique cars:

• Extensive driving experience: up to ten years in Ontario, for example
• Clean driving record: no at-fault accidents
• Few or zero convictions: potential for disqualification if you incurred a serious traffic conviction in the last few years

It's also common for insurance providers to require a separate vehicle for everyday use. This constraint ensures that your collectible vehicle is used strictly for pleasure or special events, such as car shows, helping maintain its low-risk profile.

These insurance policies normally also include the following restrictions:

• Mileage limits: you can only drive your car a certain number of kilometres per year, usually between 5,000 and 10,000
• No commuting: you can't use your car to get to and from work
• Secure storage: you must keep your car in a secure indoor space, such as a garage or a storage container

How much does classic car insurance typically cost in Canada?

In Canada, classic car insurance is often cheaper than standard auto insurance because these vehicles are driven less frequently and pose a lower risk for insurers. According to Hagerty, a leading antique vehicle insurance provider in Canada, premiums are on average 33% lower than for regular-use vehicles.

The main factors that affect the cost of your policy are:

• Vehicle value: original price tag, plus restoration expenses
• Condition and rarity: rare models or those with their original parts intact can command higher premiums
• Usage: fewer kilometres you drive, the lower the premium
• Storage: a secure garage with an alarm is safer than parking on the street, so you can expect to pay less
• Driving record: a spotless driving record is crucial to obtaining lower rates

If you're unsure what type of auto insurance policy makes sense for you, consider how you plan to use your retro model:

• If you intend to keep it locked away in a safe place, comprehensive coverage may be sufficient
• For occasional driving, classic car insurance is usually the best fit
• For everyday use, standard auto insurance works best, even if you forego benefits of an agreed-upon valuation and a lower premium

How to choose the right classic car insurance policy in Canada

Choosing the right classic car insurance policy in Canada depends on your vehicle’s agreed value, usage, and storage conditions.

Beyond the cost, choosing the right coverage hinges on how you plan to use your car. Will it help you travel to work and run daily errands? Will you take it out on the road occasionally for a relaxing cruise down the highway? Or will you keep it locked away in a garage as an investment?

Answering these questions can help you determine the ideal insurance policy for your vintage model. Always shop around and compare auto insurance quotes from multiple providers to ensure you're getting the coverage you need at an affordable price.

Learn more: Everything you need to know when buying car insurance