Protecting Your Investment

I’ve always laughed in the past when people talk about buying cars as an investment. History has shown, that with a few rare exceptions, when you factor in maintenance, insurance, etc on a car over a certain period of time, even if you sell for more than you paid for the car, you are still losing money vs other investment options pulling 6-8% a year. We have seen the muscle car boom take off, and some guys have made out great, but for the average guy, that doesn’t come along often. Finally though, the air cooled Porsche market has taken off, and seems to be picking up speed every month. We are now seeing 993TT’s reach $250k, 964’s hitting $50k, long hood 911’s reaching astronomical pricing as well. When you look back 5-7 years ago, a 993TT could be had for $50k, a 964 for the low teens, long hood 911’s below $10k easily. With the huge jump in the market, many people are not thinking about proper levels of insurance. While they may not be looking to sell and make money, the fact of the matter is that if something happened to the car and you needed to replace it with a like vehicle, insurance says they will pay out on market value, but that can be a real battle when book values are still very low. And what will they accept for comparison values? No one really knows. Trying to get a value to be able to purchase a similar vehicle can be difficult.

This is a discussion that has come up recently among car buddies, and we need to all take note. There are many different ways to protect your car. There are many collector car insurance companies out there that can issue you a “stated value” policy, where you can agree on a fair market value for the car, and pay for the policy based off that value. Companies like Hagerty, Leland West, American Collectors Insurance, among many others are out there to help you protect your vehicle in this fashion. Many of your average insurance companies do not offer or want to issue stated value policies for some reason. Now that my 964 has hit 25 years old, it does qualify for collector car insurance with State Farm where a stated value policy can be agreed on, so I am currently looking into that. I’ll let you know how it goes 😉

Bottom line is, watch the market on the aircooled cars. They are going up faster than you can imagine, and you need to be protected on a fair level. Don’t wait until it is too late.