Luxury and Exotic Car Insurance
Standard full-coverage car insurance is usually enough for high-end luxury cars. If you own an exotic car, though, you may need to get specialized auto insurance for it.
What‘s the difference between luxury and exotic car insurance?
Luxury car insurance provides coverage for vehicles that have a wide range of deluxe features and amenities to offer a superior, comfortable driving experience. Exotic car insurance takes into account factors like how few exotic car models are made and how they can increase in value over time, which often results in higher premiums.
Luxury cars are often built with premium materials and cutting-edge technologies. Familiar luxury car brands include:
- BMW
- Cadillac
- Mercedes Benz
- Rolls-Royce
According to Experian, the average cost of a high-end luxury car is $92,800.
Exotic cars are a subcategory of luxury cars. While they may have similar features and amenities to luxury cars, exotic cars are typically designed with performance and speed in mind. Popular exotic car brands include:
- Bugatti
- Ferrari
- Jaguar
- Porsche
Exotic car prices vary widely, but their worth can run into the millions of dollars.
What does luxury car insurance cover?
Most owners of luxury cars should be fine buying a full-coverage car insurance policy that includes:
- Liability coverage: Covers damages and repairs of others involved in a car accident you cause.
- Collision coverage: Covers your own car’s damage after an accident.
- Comprehensive coverage: Covers noncollision damage, such as damage caused by a falling branch or theft.
What does exotic car insurance cover?
Exotic car insurance usually includes full-coverage car insurance and “agreed upon value coverage.” This means your exotic car insurance covers your car at a value you agree on with your insurer. Standard car insurance covers a vehicle at its current value minus depreciation.
Other parts of an exotic car insurance policy may also cover:
- Show events
- Towing
- Spare parts
- Trip interruption
- Roadside assistance
Exotic car insurance policies often come with strict limitations. These criteria can include:
- Maintaining full-coverage car insurance
- Usage confined to pleasure driving and/or show events
- Secure storage in a locked garage
- Annual mileage limits
- Restricted list of auto repair shops
Do I need luxury or exotic car insurance?
You’ll need at least liability car insurance for your luxury or exotic car to drive it legally, in all states except for New Hampshire. If you financed your car, your lender will more than likely require you to carry full-coverage car insurance for the duration of your loan agreement.
If you have an exotic car, you’ll need to get exotic car insurance to cover it properly. Standard full-coverage car insurance can’t provide the level of protection that a car worth millions of dollars needs.
The agreed upon value coverage that exotic car insurance provides is necessary because, unlike luxury cars, exotic cars usually increase in value over time. A standard car insurance company won’t be able to adequately cover an exotic car at agreed upon value without overly high premiums.
An exotic car insurance policy takes into account multiple factors that standard car insurance cannot afford to cover, including:
- The cost of exotic car repair and replacement parts
- The added accident risk of high-speed cars
- The extra high risk of theft
What is gap insurance?
If you are financing a luxury car, gap insurance is add-on coverage that pays off the remainder of your loan if your car is stolen or totaled and you still have a debt on it beyond the car’s depreciated value.
This is especially recommended for luxury cars. A car can start depreciating in value the minute you drive it off the lot. The depreciated value is what car insurance companies base your claim payout on. If your luxury car is totaled in an accident or stolen and not retrieved, you will be paid out at the car’s current worth, not what you paid for it.
For example, if you have a current car loan of $75,000 and its depreciated value is $51,000, you would be responsible for the remaining $24,000. If you have gap insurance, it would cover that remainder.
How do I get luxury or exotic car insurance?
If you have a luxury car, you can get an insurance policy through most car insurance companies. Luxury car insurance is usually more expensive than other car insurance, so considering cost and coverage is important to getting the best policy for your situation.
To get the best luxury car insurance policy for your needs at the cheapest price, compare car insurance quotes from several companies. Use the same coverage limits for each quote so you can make the most accurate comparison.
If you’re looking for exotic car insurance, you’ll need specialty coverage. Insurance companies that specialize in exotic cars include:
- AIG Private Client
- Chubb
- Grundy
- Hagerty
- Pure
While some of these companies have websites you can get a quote through, it’s recommended that you call them directly to make sure all the coverage specifics for your exotic car are met to your satisfaction.