Insurance for older cars

The age of your car has an impact on your car insurance rates. As your vehicle ages, you may notice your car insurance premium changing. However, it’s not just vehicle age that car insurance companies look at; the make and model of your car matter, too. If you’re wondering how best to insure your older car and what you can do to get cheaper insurance, Bankrate’s expert insurance editorial team has answers.

Is it more expensive to insure an older car?

While new cars may be more expensive to insure due to their higher value, older cars may be costly as well. Although they may have a lower value, older cars may also have expensive parts that could make repairs expensive. The older a car gets, the harder it may be to source these parts for repair, which can also drive up the cost of car insurance on older vehicles. Additionally, older cars may not have as many safety features as newer cars, which might increase the cost of auto insurance and reduce available discounts.

The impact of vehicle age on your car insurance premium may depend on your car's make and model. Premiums for each make and model differ between insurance companies because each uses its own rating structure. A vehicle that holds its value over time may be more expensive to insure than one that depreciates quickly. A vehicle’s repair price, anti-theft and safety features are factors used to determine the final premium. Lastly, your coverage selection may change as your car gets older, potentially impacting your premium. In some cases, an older car may be cheaper to insure than a newer one if you choose to no longer carry full coverage or endorsements like new car replacement coverage. 

What kind of insurance do I need for an older car?

If you have an older car, you might wonder if it's still worth it to carry collision and comprehensive coverage. In most cases, you can choose whether you want to continue paying for these optional coverage types, but the decision may be dependent on other factors. If you have a loan on your old car, your lender may require you to carry these coverage types to satisfy the terms of your loan or lease agreement. 

Comprehensive and collision coverage are physical damage coverage options that can pay to repair or replace your older car if it is damaged by a covered claim. If you can afford to fix or replace your older car without insurance, you may not need either coverage. However, if you cannot afford it, then you might consider keeping these coverage options to protect your finances. A general rule of thumb used by insurance professionals in deciding on whether to maintain physical damage coverage is the 10 percent rule. In this case, when the annual coverage costs over 10 percent of the car’s replacement value, it may not be worth keeping the coverage. Speaking with a licensed insurance professional may help you decide whether you should maintain collision and comprehensive coverage on your vehicle. 

State minimum insurance

No matter how old your car is, you are required to carry state minimum liability limits or prove financial responsibility to register it and legally drive on roads. Each state has its own requirements, which must be met and maintained for as long as the car is registered. If you can afford more than the state minimum liability insurance, it can provide greater financial protection and is recommended by most insurance experts.

State minimum insurance is the least amount of liability coverage you must have to register and drive your car. Some states also require personal injury protection (PIP) or medical payments and uninsured motorist coverage.

Learn more: Minimum car insurance coverage requirements in each state

Insuring classic cars vs. older cars

While a classic car is an older car, there are key differences between the types of coverage offered for each type. Auto insurance for older cars that are not considered classic can generally be part of a standard auto insurance policy. However, a classic car may be insured under a specialty insurance product, offering unique coverage not found on the average policy.

A classic car is usually 20 years or older and has collectible value that typically exceeds its original sale price. Even with added features not offered in standard auto insurance, classic car insurance is usually cheaper, although the policy may have mileage restrictions. Some insurance companies only offer coverage as a specialty auto insurance policy, while others offer it in addition to standard insurance coverage.

Learn more: Classic car insurance

Frequently asked questions