Exotic & Supercar ownership for Timed Events Exposure
Owning a high performance, high value auto is not for the faint of heart. Exotic & Supercar ownership comes with extensive servicing requirements, and for most, training on how to drive the auto carefully. For those with high-end driving experience, purchasing autos with the desire to drive them as they were designed comes with responsibility. On the track, do you know if you have coverage for physical damage or personal liability? If you cause an accident or total your car, will your insurance respond? On a closed circuit track, timed event, or any other speed based group or individual “speed event”, you need to be aware of certain insurance coverage restrictions and gaps.
- Track Exposure
- Outside of expensive and very restrictive, specialty policies virtually all insurance companies have firm exclusions for physical damage, bodily injury and personal liability – leaving the policy holder without coverage. When the auto is used for any track event, speed event, practicing or training for any timed event or concorso – there is no coverage for property damage, bodily injury or personal liability based upon policy exclusions.
- If you choose to “race” your vehicle, and you are familiar with the coverage exclusions on a traditional auto or personal liability policy, there are physical damage only policies for sporting cars, garaged at a track, that are primarily used for track events and shows. Coverage for the auto is only afforded while garaged or otherwise not in operation.
- Parts and Equipment
- After-Market Tools & Equipment – Take inventory of your extra parts and ensure that you have coverage for items including: Performance tires, Wheels, Removable Targa or Hard-Tops, Tools and servicing equipment for use in a personal garage for the service of your insured auto.
- Media, Phones and other Personal Belongings – Items that are not permanently installed in your auto are not traditionally covered under your personal auto policy; they are typically considered ‘personal contents’ and covered under you home policy. Certain insurance carriers may offer a lower limit for contents located in your vehicle in the event of a theft or break in.
- Techs, Personal Mechanics & Servicing Staff
- Many performance auto collectors hire personal techs, drivers, and specialty mechanics to work with them on track, manage auto transport, and service autos on a regular basis. If these individuals are full or part time employees, you want to properly insure them with a Workers Compensation policy in the event of an accident that may arise out of the duties they perform for you under their employment.
- Title Requirements
- It’s common for clients to purchase an exotic vehicle and title it in the name of a company or single-entity LLC or LP for tax reasons. This can cause significant coverage gaps, with the possibility of excluded coverage altogether. Depending upon the usage there are traditional insurance options available. Preferably, an insurance policy needs to be in the name of the entity holding the title to the vehicle. Most insurance companies will not insure personal vehicles in the name of a company, trust or partnership name.
- Use and Mileage Restrictions
- Exotic & Supercar owners keep the mileage low, and do not drive their exotics as a primary vehicle – this lowers the wear and tear, and the risk as perceived by the insurance carrier, which keeps the premium lower. Make sure that you state the approximate annual mileage that you intend to have on the auto, in order to save on costs. If auto usage exceeds the occasional weekend drive, just confirm which vehicles that you principally drive, and driving frequency on the exotic.
- Vehicles that are collected strictly for investment and auction, and otherwise rarely driven, can be insured on a specialty policy that lowers the premium based upon the lower risk of an auto accident.
- Youthful Operators / Attractive Nuisance
- Teenagers love flashy, fast, expensive, forbidden-to-drive vehicles. Teens can ruin your clean insurance record and cause significant premium increases after a loss. Have a discussion with your kids, make rules and restrictions on operating certain vehicles, and try to keep them out of the driver’s seat without your permission.
- Many insurance companies require youthful drivers to have 5 years of driving experience or to be 25 years of age, or more, in order to have a policy written in their own name for an exotic or collector vehicle (non-primary use).
Swingle, Collins & Associates specializes in Exotic & Supercar ownership for personal property and casualty insurance coverage in Dallas, Southlake, Highland Park, and Plano. The descriptions of coverage listed on this website are brief and subject to the provisions, limitations, and exclusions that can only be expressed in your policy and related endorsements. For additional information of how Swingle, Collins & Associates can assist in meeting your Exotic & Supercar ownership coverage needs for property and casualty insurance please contact your dedicated risk manager to discuss the benefits and services of personal homeowners insurance coverage.
The information contained on this page is provided for informational and educational purposes only. It contains general information on insurance issues and may not reflect the most current developments in insurance coverage and is unlikely to apply in all factual scenarios. The information does not include all the terms, coverage, exclusions, limitations or conditions that may be contained in the actual insurance contract language. The policies themselves must be read for those details. Sample policy forms will be made available upon reasonable request.