Classic cars are in fashion- are you up to speed?
As the sun comes out, so do the classic cars. I have noticed several on the roads in recent weeks, most memorably an Aston Martin V12 Vanquish on a visit to Meath. The petrol heads or 007 fans among you may remember the V12 being driven by Pierce Brosnan in 2002’s Die Another Day.
Twenty years later, the V12 Vanquish is considered a modern classic, despite being a full decade below the government’s 30-year threshold to become a vintage car officially, for VRT purposes. At DUAL, we consider vehicles aged 20 years upwards to be “classic” for insurance purposes, as this definition fits much better with how the classic car market works in 2022.
The resale market for premium classic cars in Ireland is not a particularly vibrant, liquid one. Many people do own vintage vehicles, but the number of domestic buyers and sellers remains relatively low. For the most part, it seems that Irish collectors buy their dream car to keep and cherish. Due to this, it is common to import classic cars, often, right-hand-drives from the UK.
The pandemic has seen something of a boom in the British classic car market, which has knock-on effects for the Irish collector.
According to Statista, the UK classic car market is predicted to reach $1billion in 2022, up from $701 million in 2020. This rapid growth is expected to continue, reaching $1.3bn by 2024.
This is, in part, due to the rise in specialist online auctioneers such as Car and Classic, which has sold over £7.5million worth of cars since launching in July 2020. Another successful platform is Bonhams, which in 2021 became the first online auction house in Europe to conduct a £1,000,000 transaction, for an “ultra-rare metallic blue 1989 Ferrari F40.”
The other key factor is a rise in disposable wealth during the lockdown years. Many people continued to earn well. Money that would ordinarily have been spent on dinners in upscale restaurants and exotic holidays has been available for other purchases. Therefore, many have found themselves ready to procure their dream car, usually a vehicle that somehow resonates from their youth.
Many of our enquiries involve Irish nationals who are chasing specific cars on UK- based online marketplaces. We speak to lots of brokers who have clients coveting cars from the 1980s - the Porsche 911 being a perennial favourite. We also field many enquiries on cars from the 1990s and increasingly, the 2000s. [GH1]
From an insurance perspective, agreed value is a key consideration for anyone bringing a car into Ireland from the UK or further afield.
Brexit has hit importers of classic cars quite hard; the Revenue has levied a 21% VAT rate on vehicles imported from the UK. Locking in an agreed value within the policy terms is a good way to price that initial outlay on VAT into the costs of replacing the vehicle should it be lost or stolen.
For vintage cars already in Ireland, it is important to get cars revalued. The rising prices in the UK and the VAT levy on top of that means that many vehicles already in Ireland could now have a significantly higher replacement value, thus your client could be underinsured, particularly if they have standard market value cover with no agreed value.
Returning to importation for a moment, another pertinent factor is this: how will the vehicle be transported from the UK? Often, classic cars are sold in ‘fair condition.’ That is, driveable, but in need of a little work. If the plan is to drive back, full European cover, including breakdown cover, will be a useful ally. Older cars can be unreliable, especially if they have not been on the road regularly, or indeed, barely driven at all during the last few years.
An interesting trend that I would love to see take off in Ireland is converting classic cars to EVs (electric vehicles). In 2020, a specialist factory opened near Silverstone race track that is wholly dedicated to electrifying high-end vehicles. Currently it has a waiting list of two years. As a specialist provider of both classic car insurance and electric vehicle insurance, please do feel free to contact DUAL if any of your clients are commissioning such works.
DUAL motor polices have very few restrictions around classic cars. The vehicle needs to be at least 20 years old, running at a low annual mileage and therefore, not the insured’s primary vehicle. As such, we can offer competitive insurance on classic cars, provided that we are the chosen provider for clients regular vehicle too (with a value of €30,000 and upwards for the first vehicle when insuring multiple cars).
Please do get in touch if you have clients buying or using classic cars. And if you’re lucky enough to own one, happy driving.