Recently I overheard a conversation about insuring kit cars and thought some of the information discussed worthy enough to pass on simply because obtaining insurance for your kit car is a different process than obtaining insurance for an off-the-shelf product.
First and foremost, you will want to check with your current insurance carrier and then get ready to shop around.
Be prepared: I found that insurance premiums for kit cars varies widely.
As you shop around, keep in mind that car insurance is normally divided into two categories of coverage including liability insurance, which mainly covers damage and injury to the other driver; and collision and comprehensive, which covers damage to your vehicle. In addition to these two broad categories, there is also the separate issue of injury to a passenger in your vehicle (medical insurance), or injury to someone who is riding/driving it, which may not be covered by simple liability insurance.
Obtaining liability insurance on a homebuilt vehicle is usually easier than obtaining collision and comprehensive insurance, but this depends greatly on the type of car you insure and on the status of your existing insurance.
If you already have a car insured and your driving record is free of violations, you may very well be able to obtain reasonably priced insurance from your current carrier. At least call your insurance agent and ask about adding your kit car to your existing policy. When I called around, I found this to be the best option, but you will have to have a clean driving record to save money here.
As for liability insurance, this is easy enough to obtain. You can expect pricing to be comparable to your existing coverage. It's the collision and comprehensive coverage that can cost you the big bucks and be a real bear to obtain. In talking to my insurance agent, I found that the collision and comprehensive coverage is more expensive and harder to secure simply because it is based on the value of your car, which can be a challenge for the insurance companies to determine.
This explains why the insurance company may ask you to have your kit car professionally appraised.
You see, an insurance agent has at his or her fingertips all the information needed to quickly and easily assess the value of an off-the-lot vehicle. But, given that kit cars are built to spec, this information doesn't exist.
In talking to my insurance agent, I also learned that if you don't already have insurance on an existing car, it will be very difficult to find a company that will write a new policy for your kit car.
My agent says that he knows people who purchased an old car a few months before finishing their homebuilt car, insured it, and then added the homebuilt car to the policy when it was finished.
In looking around, I also found a site that you may want to checkout. It's called PolicySure.com and the site will provide you with online quotes for homebuilt vehicles.
Another great resource is your local car club. Talk to other local kit car owners to learn where they have their cars insured and what their premiums are.
Sure, there is a little legwork to do here, but the money you save in the long run will make it worth your while.
