Classic Car Insurance + CARnection

Jim Kruse - Vice President for Classic Auto Insurance

Over the last two decades, Jim traveled the world to be with cars and collectors at events like the Pebble Beach Concours d'Elegance, Amelia Island Concours d'Elegance and the Paris Retromobile. When you're around collectors as often as Jim, you get asked a lot of questions.  "Where should I sell my car?"  "My kids aren't interested in the cars, what should I do?"

Contact: Jim Kruse at jim@classicins.com | N/A | Visit Online!

               

Classic Auto Insurance has been around for over 25 years; how and why did it get started. And how did you get involved in the insurance business?

• How does Classic Car insurance differ from regular car insurance?
  • Are these a declared value plan? If so, are appraisals required? Or is there a minimum value before that kicks in as well?
  • We’ve heard that there are different types of classic and collector car insurance in the sense that some care and others don’t how much the vehicle is driven. How are your plans structured?
  • Who underwrites all the policies for CAI? Do you underwrite your own policies or is a 3rd party involved. 
  • What does classic car insurance cost compared to regular insurance?
  • Are there provisions for classic car insurance? Meaning… limits on mileage, use, are the vehicles covered while at a car show, what about on a road rally or tour? or on the trailer/in-transit?
• Does the insurance cover vintage race cars? Or will they also need Track Day insurance?
• One of the other ventures you’re involved in is called CARnection – let’s talk about its genesis, how it relates to Classic Car insurance, etc. What is CARnection all about?

and much, much more!

Crew Chief Brad: [00:00:00] BreakFix podcast is all about capturing the living history of people from all over the autosphere, from wrench turners and racers to artists, authors, designers, and everything in between. Our goal is to inspire a new generation of petrolheads that wonder. How did they get that job or become that person?

The road to success is paved by all of us, because everyone has a story.

Crew Chief Eric: The following episode is brought to us in part by Garage Style Magazine. Since 2007, Garage Style Magazine has been the definitive source for car collectors, continually delivering information about automobilia, petroleana, and more.

To learn more about the annual publication and its new website, be sure to follow them on social media at Garage Style Magazine or log on to www. garagestylemagazine. com. Because after all, what doesn’t belong in your garage?

Indianapolis, Indiana is [00:01:00] home to a great many automobile lovers. Known as the crossroads of America, the city rumbles at the heart of four interstate highways and six US highways. It’s where the Indianapolis Motor Speedway hosts the most attended single day sporting event in the world. The Indianapolis 500!

Don Weberg: Yeah, um, I hate to interrupt your monologue, but… Indianapolis is also home to Classic Automobile Insurance Agency, a family business built on a love of classic cars that drives truly inspired service for collector and classic car enthusiasts.

Crew Chief Eric: You’re absolutely right, Don. And that’s why we have Jim Kruse, the vice president of Classic Auto Insurance, on with us tonight.

So let’s welcome him to the show and talk about protecting your pride and joy. So welcome to Brake Fix.

Jim Kruse: Thank you. Thanks for having me. Happy to be here.

Crew Chief Eric: Like all good Brake Fix stories, tell us about your petrolhead origin story. The who, the what, the where, the when of Jim Cruisey. How did you come up through the hobby?

Was it by way of your family or was there a vehicle that caught your attention as a kid? [00:02:00]

Jim Kruse: I’m probably one of the luckiest guys in the world when it comes to the car hobby because I was able to not only grow up through the hobby. But I’ve made it my vocation for the last 30 years. My father restores cars and specializing in pre 1915 cars.

My earliest memories were riding in my mom’s lap in our 1908 brush when I was, you know, nine or 10 years old. But before I could drive, they started me with bicycles. So I was into early turn of the century bicycles, and then I was old enough to add motors. We jumped up to Whizzer motorbikes. When I was able to get a driver’s license, they jumped into Indian motorcycles, had an Indian, an emblem with two wheels.

Then I had figured out that it’s hard to take a date with you on a motorcycle. So then we jumped into cars with my father through our restoration shop. We restored a 1913 Renault together, a little two cylinder model AX. Which ended up being my honeymoon car with my wife. Actually, we did a week long rally in it.

So I’m in it by pure family. And my heart has always been with turn of the [00:03:00] century pre 1915 cars, which is unusual for anybody who isn’t taking social security. It’s more of a, an era that you see, you know, the older folks that like it, but I always have enjoyed cars that. You know, there aren’t a million experts on, I’ve got a 1908 Cesar Nalden, which is a one cylinder Grand Prix racing car.

There’s only just a few left in the world. And so when people start pointing out what’s wrong with it, my first question is, what does yours look like? And obviously they don’t know. So that’s always been my, uh, fall back on having cars that most people haven’t seen before. So I came up through it naturally and restored quite a few cars and very lucky to fall into the business side of it with the insurance angle, you know, 30 years ago when I graduated from college, it’s been a lot of fun to say the least not a lot of nice people.

Crew Chief Eric: So back in the green room, you mentioned you had to take the Lamborghini poster down off the wall that you had since you were 11. So it sounds like you might like some modern cars too. So let’s talk about that poster on your bedroom wall.

Jim Kruse: I’m a true car fan, [00:04:00] which is what’s great about the car hobby is, is that if you like cars, you like all cars.

Some of you like more than others. You know, you can’t say which is your favorite kid, but we all know we have one and cars are very similar. My newest collector car. I drove in high school was a 69 SS Camaro 396. That was my daily driver back then, but all the way up through today, I’m a huge Corvette fan.

The new C8 is just an amazing automobile. Lambo’s never owned one. My wife wouldn’t let me have one, even if I could have one, she knows me better than I do, so she keeps me honest by not letting me have it, but now really all cars. That’s what’s great about the industry and the hobby. If you like them, you like them all.

And then the best part is the people that come along with them because we all know what a Corvette owner’s like or a BMW owner, a Porsche owner. The stereotypes are true and that’s what makes it fantastic. Just absolutely love it. Just love it.

Crew Chief Eric: So for petrolheads of a certain age, there’s two different Lamborghinis that could have been on your wall.

You’re either in the Miura camp or a Countach kid.

Jim Kruse: Countach, 84. So that

Crew Chief Eric: begs the question, sexiest [00:05:00] car of all time.

Jim Kruse: See, I fall back into the classic era and I’d have to go with a teardropped Bugatti Type 57. That’s where my heart falls back in the custom era. I mean, I’m a big street rod fan too. In my world, the high point of street riding was 1930s.

where they were taking chassis and you could build anything you want. You took it to your custom bodybuilder, like making a dress, and they would do it for you. That’s the epitome of custom cars. And so I, any European car from the 1930s, custom body, Pininfarina, whatever it might be, it’s just absolutely fantastic.

Crew Chief Eric: And the opposite of that, something you go, eh, not so much. Or ugliest car of all time.

Jim Kruse: That’s actually a tough one. I’ve never been asked that question before. Well, I can tell you my least favorite that I’ve ridden in. How about that? I was in Sofia, Bulgaria in 1993, and we were driving to Cappellari, Bulgaria.

We had to take a Trabant. Are you familiar with those? Yes. As we were leaving Sofia, there was a checkpoint. We had to show them your [00:06:00] ID. Something we’re not familiar with in the U. S., but there you had to. I swear the guys at the checkpoint, because I knew my friend that was with me, we were both Americans with our two drivers.

They almost felt sorry for us that we were in this car. You could just see it in their eyes, but that was probably my least favorite car I’ve ever ridden in. Let’s put it that way. It was about four hours of agony in a two cycle Trabant. We’ll talk about the Turkish toilets we had to use later along the way, but that’s a whole nother story.

Probably my least favorite is that.

Crew Chief Eric: I mean, there’s nothing worse than a bad fiat that you make, even more terrible.

Jim Kruse: And they did. They did. But if you didn’t know any different, that was the best they had. You know, better than a horse. Let’s put it that way. I’d rather be in that than a horse. So.

Don Weberg: Classic auto insurance has been around for 25 years.

Yeah. How did it get started and how did you get involved in the insurance business? It sounds like it just came naturally from your family, the restoration shop, etc. It just sounds like it’s in the DNA.

Jim Kruse: Yeah, it is. And in fact, I was fortunate that My father, before he was able to quit, he was a service manager for a BMW [00:07:00] dealership in Fort Wayne, Indiana.

I worked my way through college as first a car jockey on the lot, because it was cool driving other people’s BMWs. And then into the sales portion, I was given great advice at one point. Cause when I was in college, I went to Purdue university. I didn’t know what I wanted to do. And the F& I sales manager, when I was just moving cars around the lot, and I was having a conversation one day, said, if you want to get a job, hang out where people who hire people are.

And in that case, it was at selling BMWs. Who buys BMWs? But people who own businesses. The year that I was graduating from college. I actually sold and delivered a BMW to the CEO of a local insurance company, which happened to be K and K insurance. And for anybody out there that’s familiar with K and K, goes back to the old racing days, the number 71 Dodge Daytona, historical name in the motorsports industry.

Basically at delivery, I asked, I told him I was graduating from college and I needed a job. And I started there about three days later. That’s a true story, but I had no clue what I wanted to do. Never thought about going to the insurance [00:08:00] industry, but I was a car guy. Got into it from that perspective, was in the collector car portion, worked in the motorsports area for insurance, which involved IndyCar.

Offshore powerboat racing, anything with a motor, let’s put it that way. We insured. Again, that was my start 30 years ago. And since then been through a couple iterations of my own companies, which I’ve sold. And then the most recent company, Classic Auto there in Indianapolis, Dan and Drew, the father and son owners of the company I’ve known for going on 20 years needed something to do.

And they needed somebody to come in and kind of shepherd them to the next stage of the company. It’s worked out perfectly. It’s a great family business, heart of the country in Indianapolis. car capital of the world as far as I’m concerned. It’s a great opportunity for everybody involved.

Crew Chief Eric: So let’s dig in a little deeper.

But for those of us that are learning about classic car insurance for the first time, we got to start with the basics. So let’s answer the most obvious question for our audience. How does classic car insurance differ from regular car insurance?

Jim Kruse: Yeah, so [00:09:00] several ways. First, everybody always dives right to the valuation.

If you’ve been involved in an auto accident, I’m sorry to hear that, but it happens, there’s always a question as far as what the car is going to be valued at at the time of loss. Either a partial loss where you’re forced to go to a repair shop that the insurance company dictates, or a total loss where all of a sudden you find out that you owed way more on the car than they’re going to pay you for it.

There’s always a big question at settlement time. The biggest difference is here with classic collector car insurance like we offer. That’s predetermined up front. So in the event of a total loss, let’s just say a fire, you know, immediately how much you’re going to be paid. It’s 50, 000, whatever the number might be.

There’s no question at that point. In the event of a partial loss, it’s equally as easy. Most people have a good idea of where they want to take the car for repair. The guy who restored the car or somebody that they know it’s up to their choice where they want to take it, which makes it very easy for the client [00:10:00] at that point also makes it easy for the insurance company because they’re not trying to hunt down or scout down a company in the area or whatever it might be.

So that’s really the biggest difference. Is that side? Beyond that, auto insurance is one of the most heavily regulated insurances there are in the world. A lot of the coverages are mandated by the state, no liability, which pays if you hit somebody else. There’s coverage like uninsured motorist coverage, because yeah, you can get hit by some with no coverage.

All that stuff’s mandated. And then there’s always little bells and whistles that companies put in towing and labor, things like that on top of it. The biggest thing is the valuation. And then maybe the second most important thing is the price because our cards are driven very little. The premiums are significantly less.

So typically. Maybe half to 60 percent less than a normal auto policy, but that’s taking into consideration that you’re not driving into work every day. I mean, it’s not what we typically do with our collector cars.

Crew Chief Eric: You mentioned that there are declared value policies, but how do you come up with that declared value?

Jim Kruse: Yeah.

Crew Chief Eric: We’ve talked with [00:11:00] track day insurance companies before. We’ll touch more on that later valuations. So in this case with class and collector card, does it require an appraisal or does the owner come to the table and say, this is what I think the car is worth. Plus all the receipts I have, how do you put together that to clear value?

Jim Kruse: All of our underwriters, we call them concierge underwriters at our company. Everybody is highly involved in the car hobby. So let’s start there. Not very. Typical that someone will present a vehicle that we’re not familiar with from evaluation perspective. We don’t use guidebooks auction results. If there’s something very specific that someone wants to compare their car to, you know, bring a trailer right now.

I mean, they’re selling more cars than anybody. And that is, it’s incredible. The real time data that you can get on there, just searching their results. But normally that’s how it is. Our company, we don’t require appraisals. And in fact, the only time that we would is if the value of the car is based off the authenticity, i.

e. matching numbers for a Hemi Barracuda convertible, you know, they made what [00:12:00] 11 of them. There’s a big difference between. Just a stock crate motor and a 318 and a Hemi that’s original. So we might want some additional documentation there. If somebody wants 2 million for a car, but that is very, very unusual.

95 percent of the cars that we see are ones that we’re pretty familiar with. So it makes it very easy, no additional costs for the customer. But again, that’s just for us. I do tell people though, appraisals are incredibly valuable from an estate perspective. If you’re leaving them to your kids or whatever it happens to be, if there’s an estate, it’s going to get dolled out someday.

It’s good to have an updated appraisal just so there’s no question as far as that goes. We see that a lot. When there isn’t an appraisal, people will ask what the car was insured for and that all of a sudden sometimes become the legal amount. In valuing estates and how things get broken up amongst families, but that’s not the best way to do it.

To be honest with you. That’s what we look at as far as like on track physical damage. Not sure you’re talking there. They see a lot more partial losses hitting the wall, things like that. They might require a little more [00:13:00] if somebody’s got a rear end that’s wearing out in their Porsche. Okay, you’re not going to get a brand new one if the old ones wore out.

One of those kinds of things. Back in the day, we actually wrote policies for IndyCar on track when they first split off from CART. And that was a big issue, trying to figure out somebody touches the wall. They want a whole new everything. Well, no. You still got parts that you can use again. That’s a difficult thing to adjust, actually, the on track physical damage.

So I’m sure they’ve got different requirements than we do. But for us, normal road going cars, not an issue, not a problem at all.

Crew Chief Eric: You mentioned you have these concierge underwriters. Does that imply that Classic Car Insurance underwrites their own policies, or are you using a third party provider?

Jim Kruse: We are an agent for American Modern Home Insurance.

That is our main company that we use. We have others that we do for policies that don’t fit with what their profile is. We basically act as the insurance company from an underwriting perspective, but we don’t pay the claims. So they’ve got an incredible claims [00:14:00] department. When I say concierge, I mean the person that you’re talking to on the phone can manage the entire process.

There’s no, let me go talk to my manager. You want too much for your car. Got to get a second opinion. It makes it very easy for the process and also makes the client comfortable that the person they’re talking to understands what they’re doing. No one wants to call somebody and thinks that they’re talking to somebody that’s the decision maker only to find out 20 minutes in the conversation that, Oh, hold on.

I can’t help you. It’s above my pay grade. I got to go talk to somebody else and separates us from a lot of companies out there. The person you start the conversation is the one you’re going to end the conversation with and probably be a friend going forward. I mean, we have got clients that have been on the books for 20 plus years and they’re still talking to the same person, which is kind of nice.

How do you define a classic car? There’s official designations. The Classic Car Club of America has their definition, but from our perspective, as far as what’s insurable, kind of the generic way to look at it is the car has to be worth more [00:15:00] than just the transportation that it is. A new Chrysler Pacifica minivans worth 25, 000.

But it’s utilitarian, a new Porsche, it’s worth more as a Porsche and having fun with it as it is just a driver to go back and forth to work. So in our world, if it has more value than just utilitarian mode, it’s a collector, which means it qualifies for our program. A lot of states, it says that car has to be at least 25 years old to get a classic plate, things like that.

But that’s not what we, we look at here. We really look at whether the car has some intrinsic value beyond just driving it every day. And that’s actually a lot of cars now. It’s incredible how many newer cars. Uh, just straight up hot, cool collector cars right off the line. And people are treating them as such too.

Don Weberg: Got a lot of cars coming in to maturity from the nineties, even the earlier part of the new millennium. I mean, I got to tell you, I’ve got friends all over Facebook who are generally younger than me. And it’s really interesting, the cars that are turning them on. I mean, they’re literally looking at minivans.

It’s in the nineties and the eighties that they are, they’re just blowing their [00:16:00] minds. And I always kind of think, yeah, they were kind of cool. We overlooked them. Cause as you say, they’re just utilitarian. They’re the mom mobile to get us to school, to soccer, et cetera. That’s all those cars did. But now the survivors that are still with us that are in nice shape, that is pretty impressive.

You look back at some of the APVs that General Motors produced and you know, they have that dustbuster shape, which really, it does give them a unique image and look at pickups for crying out loud.

Jim Kruse: Oh my gosh.

Don Weberg: They have always had a strong point in, you know, the heart of collectors, but now it seems even more than ever.

Jim Kruse: Did you see any of the numbers from the most recent Barrett Jackson auction? 1990 pickup trucks that are going 100, 000 plus. I would believe it. It’s a different marketplace than I think any of us would have predicted, but none of them survived. I mean, you use pickup trucks, so you threw them away, right?

And so you get a good quality pickup truck. And actually one of the cars that we have in our collection at Classic is a beautiful white C10. We just had that down at a show in Nashville for the C10 Nationals down [00:17:00] there. Beautiful truck. But yeah, very unusual to see things like that. But you’re right about the cars that folks are collecting now.

When was the last time you saw a nice 84 Plymouth minivan? Like never. Right. That was first year Ford. It is unusual to see those cars at events and there is interest in them because historically that changed the world. 84 Plymouth minivan. That was a complete game changer. That was the model T of 1908 in 1984 when they put that on the road.

One quick story there at that time, my dad, I said, he’s a service manager. It’s a Chrysler Plymouth BMW dealership. I’ll never forget one day I was sweeping the floors and all the mechanics came in and we’re looking at this 84 Plymouth. 2. 2 turbo minivan. It was a five speed. Plymouth never made a five speed minivan.

No one could figure out how this car made it to the street, and she said she just bought it at a used car lot, and all we could figure was is that it was one of those cars that escaped from the factory [00:18:00] somehow. Somewhere on this planet, there’s a five speed 2. 2 turbo minivan.

Crew Chief Eric: It belonged to Wally Swift.

Jim Kruse: Do you know the car? I mean…

Crew Chief Eric: And with their stories of it. And we had a member who recently passed away who actually drove that minivan. And he talks about, guess what Wally gave me for the weekend because he worked in Chrysler’s motor sport division. He’s the one that brought me on to SCCA.

Jim Kruse: Okay. So this is a very cool story then.

I mean, this is an absolute fact that car was in Fort Wayne, Indiana at point set Chrysler Plymouth. And everybody’s looking at it saying they never built that car. I’ll

Don Weberg: build on both your stories. And I don’t know if we’re all talking about the same car. It has to be. But what you’re describing was up for sale about a year ago.

Okay. One of those online, but I can’t remember if it was a Plymouth or a Dodge. I really can’t remember that. But I do remember reading the ad thinking, my God, I’ve got a manual transmission. I don’t know that I’d ever seen one with it. They always have the seven. Well, the little front wheel drive automatic.

I didn’t know that I’d ever made one. And then. That buddy I was telling you about, who’s looking at the APVs, he [00:19:00] sends me one through text message and says, check this out. It’s a manual transmission. You know, Eric, I don’t know if that’s the same one you’re talking about. And to your point, are we all talking about one or are there a few little unicorns out there running around?

Jim Kruse: I can

Don Weberg: remember

Jim Kruse: cause in an 84 I would have been. But a freshman sophomore in high school, I can remember back then, let’s face it in a new car dealership, there wasn’t anything that was really all that much interesting and they have mechanics all huddle around a minivan of all things. And it was like a silver blue.

It was a light blue color, no wood grain. So it wasn’t like the grand caravan or anything or the grand Voyager. That’s what they said back then. Now, as soon as you say, it’s the only one. There’ll be 50 that come out. I realize how this works, but in my mind, as far as I was concerned, these guys had seen everything that was it.

Interesting story, small world on this thing. I’m glad to hear it might be still around.

Crew Chief Eric: You always wonder where this stuff ends up. So the punchline on this is through classic auto insurance, there’s really no limit to what could be considered.

Jim Kruse: Oh, yeah.

Crew Chief Eric: A classic or [00:20:00] collector car. So it doesn’t have to be low volume Hispano Suiza or something like that.

Something super rare. It could be, as long as you can find a way to insure it, it can be insured under one of your guys classic and collector policies.

Jim Kruse: Oh, yeah, absolutely. And in fact, go back to the truck things. They made millions of trucks. There’s hardly any left. So as far as production goes, rarity does not equal value.

That’s a sad fact for a lot of people that they assume it’s one of one. So it must be worth a lot of money. Nope, not necessarily. It only means they hated it back then too. That’s true. Normally, if there’s not many of something, it wasn’t a good car to begin with. That’s all there is to it. And I will throw.

50s Ferraris and all those cars in there with all those carburetors that never match up. I mean, they’re beautiful. That’s why they gave you a toolbox with the car when you bought it because you needed to have it. But no, you’re right. Pretty much any car, especially depending on how the people keep it and protect it.

I mean, let’s face it, AACA now they’ve got 20 year old cars now that are showing up at their shows that are part of the car show. Again, I’m not saying that they’re for me, [00:21:00] but I think it’s fabulous that there’s entry points really at any level for anyone to get involved with the car hobby. Sometimes we get accused of being car snobs looking down our nose, other people have, and I think that’s a shame because the love of cars is the love of cars, whether it’s a 10, 000 car or a 10 million car, most of them go down the road.

Equally as well, and everybody’s having just as much fun when you’re sitting on the seat.

Crew Chief Eric: See, that’s exciting news for all the Aztec owners out there that can now claim their cars as collectors. That’s all I’m going to say.

Jim Kruse: And if you own an Aztec, you’re going to have to own a Cybertruck. I mean, that’s all there is to it.

You’re going to have compatriots in pain. As you have those two cars in your garage, but you got to have the whole tent kit for the Aztec. You got to have the whole camping portion for that. You’re not really in the game otherwise. So,

Crew Chief Eric: well, I’m happy to hear that there isn’t an age minimum. There isn’t a brand specific thing that you have to jump through all these hoops to get these cars.

That’s a very open policy. So that begs the question then, is there some sort of limitation [00:22:00] that classic and collector owners are up against when they register their vehicles with classic auto insurance?

Jim Kruse: Yeah, there is. If you’re going to drive your car every day, that’s not what we do. Rates are not set up for that 8 o’clock in the morning traffic.

Sadly, and this breaks my heart, I learned to drive in a 1927 Model T. That was the first car I ever drove in our side yard of our house. If you’re a young driver, 15, 16 years old, it’s incredibly difficult to get insurance. It’s just the way that it goes. All of us have kind of Gone through that pain until legal in our world, which some companies it’s five years experience.

Some companies it’s 10. I’ve always told people with that, that if you’re young and you’re a car person, don’t screw up because it’ll just make it that much more difficult for you when you do want to join the hobby officially. But believe it or not, from a car perspective. As long as you’re not driving it every day, we really like and prefer that cars be kept in a fully enclosed lot garage, which typically isn’t a problem for a collector cars.

I mean, it’s funny. You’ll see the old car in the garage and the new car in the driveway. So that’s [00:23:00] kind of the way the world works where, you know, they’re more concerned about their old stuff than their new stuff that really defines a collector. They want to protect them and take care of them. Mileage wise, I mean, most people don’t drive the cars more than a couple of 3000 miles a year.

If they drive more than that. That can be accommodated. I was fortunate enough to take a 1910 Oldsmobile on a three week, 3, 000 mile rally, which under most circumstances would be way more than that car would ever be driven in a year, and we did it in three weeks. There are circumstances where people are going to drive more, but we can accommodate that kind of stuff.

Not a big deal.

Crew Chief Eric: Not every state is the same way, but here in the DMV, we have historic titles. When we convert the cars over to collector status, to that point, there is a minimum number of years. Sometimes it’s 20, sometimes it’s 25 in Virginia. Antiques have to be 50, you know, things like that. Does your policy require what we would call here a brown title or a historic title to make sure that it’s not a car that’s driven every day?

Because the stipulation with those titles, if they’re not daily drivers, they’re [00:24:00] not insured the same way.

Jim Kruse: Believe it or not, in some states, there’s actually requirements that you like keep a log book of your miles. If you have a historic plate. I’ve never known anyone to have pull that out and show a stopping officer in theory, they could know our policy doesn’t require that some states in order for you to get a collector plate, they do require you to show collector car insurance.

So it’ll say right on the ID card when you hand it to him. So you’re right. Every state is different myself. I’ve never had historic plates on a car. I’m a bit of a conspiracist from the standpoint that someday when they say that our old cars. admit too much smoke and things. It’ll be very easy to just pull up all the historic plates and say, we’re taking these cars off the road.

So I kind of think that if I’ve got a normal license plate, it’s going to make it difficult for them to say, get that car off the road. But that’s just me. That’s just my weirdness of the world. So, but beyond that, yeah, there are state differences as far as licensing goes.

Crew Chief Eric: So I remember back 914, they required [00:25:00] him to log his miles.

Every year to keep the policy going is the same true with classic auto insurance, or do you have a different mechanism?

Jim Kruse: No, not required for us. And again, there’s going to be individual differences between the agencies and the companies that are out there that offer these things. And that’s why, you know, we always tell people.

Write down the top three or four things that are most important to you. And those are the questions that you want to ask when you call whoever you’re calling. The dirty little secret is there aren’t that many of us. There’s only a handful, maybe half a dozen companies like us that are out there. So you’re not going to spend weeks calling around, but just whatever’s important to you.

If you are going to drive, let’s say 10, 000 miles a year, you’re going to want to find a company that says that’s not a problem. We can do that for you. And there’s companies out there that can do that. Most people don’t. Little differences here and there. For sure.

Don Weberg: Can you kind of walk us through a claims process?

What happened? My car just got whacked. What do I do?

Jim Kruse: And this is just good advice, whether we’re talking classic or just standard auto. The biggest thing is everybody’s got cameras now on their phones. Take pictures, [00:26:00] document things, take a lot of pictures. Can’t hurt. You know, in the old days, you had to go back after the facts and they try to guess how things happened.

Like any accident, make sure you get everybody’s information. From that point going forward, you can drive the car home. Great. If you can’t, you get it towed. Most people in our situations, they have the cars towed home. They don’t have them taken to a lot. You know, if it’s a newer car, a lot of times they’ll take it to just a wrecking lot next to a tow yard.

And from that point forward, depending on the severity, it’s just a matter of one finding a shop. If you don’t know of a shop, and that certainly can happen depending where you’re at, you buy a car at an auction. It might be your first collector car. You don’t know anybody. We absolutely can get you in touch with.

an expert in that field. What you want to avoid from a claims perspective is working with a company that are just sheet metal hangers. And that’s really what bump shops are today, a body shop. There’s no letting, there’s no filling, there’s nothing. They hang sheet metal on and that’s it. We make sure that people that you go to that they’re familiar with what it takes [00:27:00] to bang out a fender.

I mean, an English wheel, there’s skill sets for certain cars that you have to have. Fortunately, one of the nice things about these programs are, and this relates back to the lower premiums, claims, they don’t happen that often. And when they do, typically they’re not that severe. It does happen. We all know stories.

There’s plenty of pictures on the internet and videos of having issues, but generally the claims. They’re infrequent compared to standard auto. The cars aren’t used that much. The biggest thing is documentation. If the car’s hurt, we can fix the car. It’s hard to fix people that are hurt. So it’s always good if there’s no injuries.

If there are, you treat it just like a normal accident. Go to the hospital, whatever you need to do. The claims are, I think, sometimes the easiest part of this whole process, believe it or not. It’s not a big deal to get managed.

Crew Chief Eric: So there’s always two sides to every claim, right? There’s the, I came out of the cars and coffee and just…

Took out a telephone pole with my Mustang, and then there’s the Mustang that hit you as it crossed traffic coming out of the cars and coffee. So the question [00:28:00] becomes, we know our standard insurance policies have that personal injury protection or the PIP. There’s the liability, there’s the other thing, so does the classic auto insurance operate the same way or does it only cover the car?

Jim Kruse: Yep, and you’re in Maryland, so you’ve got personal injury protection, that’s why you know that. A lot of your listeners that are listening right now have no clue what you’re talking about because it’s medical payments in other states, but you’re exactly right. When I said what makes collector card insurance different, and when I talked about the agreed value of the policy, everything else is pretty much dictated by the state, what ends up happening is, and at least for us is that when we have a new client come on board, we match all those coverages, your PIP coverage, your liability with their standard autos.

So it’s exactly the same coverage as everything else they have. The other reason why that’s important is, is that if someone has an umbrella policy or an excess policy, in other words, a policy that goes over all of your insurance, our policy would be under that umbrella as well because the limits are the same.

A lot of companies will want you to give [00:29:00] them a copy of the policy. They can see it to make sure it’s a legitimate company that they’re going over, but we try to match that with the other policies. So it is identical. Coverage to what you would have on your standard auto,

Crew Chief Eric: let’s say here in the DMV where things are a little bit more expensive because we have extra riders on our policies.

What does the average cost look like? If you could just say maybe normalizing it for the country, let’s talk about a 70 challenger or a late sixties Mustang. What would that cost to cover for a year

Jim Kruse: from a valuation perspective? The biggest part of your premium is the value of the car. The liability is pretty inexpensive, really.

Because again, Odds are you don’t drive it that much. There’s not a big liability where you’re going to hit somebody else. So that’s pretty cheap. Most of our claims come from comprehensive claims, fire, theft, roof collapse in the winter in Minnesota from too much snow, like a 50, 000 Dodge Challenger, a Mustang.

You’re going to be in the 450 to 500 range

Crew Chief Eric: for the year.

Jim Kruse: Exactly. And you compare that to a new 50, 000 two [00:30:00] series BMW is going to be 1, 200, 1, 500 a year. I mean, it’s significantly less than a new car. And then you get all of the benefits associated with it that you don’t have with that. New BMW policy, meaning if your car catches on fire and burns up, we cut you a check for 50, 000 and you go out and buy another one.

That’s the peace of mind that you get with policies like ours.

Crew Chief Eric: Let’s just say your daily driver’s down and you have to use the collector card to scoot around in and you’re putting some excess miles on it. You did a couple of long distance car shows because you didn’t feel like towing it. And you go over, let’s say this high water mark that we’ve created, at least for this episode of 3, 000 miles, let’s say you do 4, 000 miles or 5, 000 miles in a year with the vehicle.

What happens if anything?

Jim Kruse: Really nothing. One thing I would say, if it turns out to be your backup vehicle. What’s going to happen this day and age, when you’re talking late model collector cars, now it’s not a big deal to have a, you know, a C5 Corvette be your backup for in the summer for a week, let’s say.

I can’t speak for everybody, but I can tell you, we do have [00:31:00] occasional use for things like that. We can actually endorse the policy to make sure that you’re covered. I would say for anybody listening, if you’re ever in that situation, I would call the company and tell them what you’re going to do. And they’ll work out a solution for you.

So there’s no question. What you don’t want to do is have a potential claim figure out afterwards. If you have coverage, I can tell you there’s coverage for exactly what you’re talking about. Let’s put it that way, but you’re gonna want to understand that policy was sold to you as a limited use collector car policy.

If your car’s in the shop, it starts out as a week, but then with supply chains. It’s three weeks and then, and then, and then very well could be an issue for you. More communications, the better. It’s very easy to reach out and just say, this is what I’m doing. We’ll document the file. You’ll be just fine. So, and also from a mileage perspective, we actually have 6, 000 unlimited mileage on our policy.

So you have people that do. We call them transcontinental rallies, coast to coast, Portland, Maine, Portland, Oregon, drive both ways. Not a [00:32:00] problem. You just need to be able to rate, or in other words, charge for that kind of an exposure. If we sell you a policy or if anybody sells you a policy with the understanding, you’re not going to use it that much.

And then it turns out, you know, you’re going to drive it 50, 000 miles. Well, that’s not what you paid for.

Don Weberg: Bottom line, if I’m hearing you correctly, is no matter what, if you’re going to start using that car a little more, call the insurance guy and say, Hey, this is what’s happening. How do we make sure my policy still covers me?

Jim Kruse: Absolutely. And anytime there’s a question that we all know, all of our customers know exactly what they said when they bought the policy. Give you another great example. Happens every April and May, prom time. I can’t be there for the prom, but my neighbor is going to drive my son and my daughter in my car for the prom.

Is that covered? Probably is. It’s best to then call the company and say, I’ve got another driver who’s going to drive my car for this event. Is it covered? Always better more communication than not. That’s just the gold rule. Have a conversation with somebody. That’ll work [00:33:00] out.

Crew Chief Eric: Having a bunch of cars myself, I’ve taken the route of, well, the car’s really not worth that much.

So I’ll just do liability only. Yep. In this case, it’s a trade off. I could actually get more probably pay less overall and have a better experience than just that liability only that I say, well, if somebody hits me, I’m just going to walk away from the car. I’ll build another one or we’ll get something else.

I guess is liability only an option in the classic car world as well, or it’s not, it’s just a more comprehensive plan altogether.

Jim Kruse: One, it really isn’t from the standpoint that most collectors are concerned about the physical damage. The first person that calls up and says, I don’t care about the car. I just want liability.

They probably don’t qualify as a collector because we all do. The old joke is when we used to have photographs in our wallets, which we don’t have anymore because we have phones, but if you ask for pictures of the guy’s kids, he doesn’t have them, but here’s my cars, right? That’s a collector. These policies are so inexpensive.

It doesn’t make any sense to shortchange yourself on the physical damage at all and just do a liability only policy. [00:34:00] It’s not like standard auto where your policy is 2, 000 a year. And now all of a sudden you got to make a choice, right? It’s not that way. It’s not that expensive.

Don Weberg: And actually, Jim, I’m one of your non collector collectors.

Back in California, we just recently moved here to Texas. We had normal liability coverage on all the cars except the daily drivers because they had payment behind them. And then we got that DeLorean. The financer. Was a classic car financer. That’s all they loan money on. And they insisted on having collector insurance.

And they gave me a choice. They said, you’re going to go with this company or this company. And that’s it. And when I thought, okay, well, what do I get now? You got to call them. Okay. So you’re forcing me to do business with one or the other. I got to do all the legwork on it, but I called them. I like Haggerty the best.

So we went with Haggerty. They were happy. I was blown away because here we were, we had, and I think it’s like what you said, I forget the exact amount, but it was like full coverage. Car gets whacked by one of those crazy Mustangs. Car blows up [00:35:00] driving down the road. Car just catches fire. And let’s face it, DeLoreans love catching fire for no reason.

They just cut me a check for the agreed value. That’s it. Car’s done. I’m done. I get a check. I walk away. I buy something else in California. And this is where that state thing comes in. All three of us are from different States and we have different rules we have to work within. In California, we actually could not afford all of the collector cars to be on a single Hagerty policy.

It was just too expensive. And the broker who was actually out of Florida of all places, the broker actually said, yeah, California has some very, very high rates because the way he put it was bottom line year around a lot of people all the time. So your chances of getting hit by an honest to God accident.

The guy did not see you. He bumped into you. You’ve got a stainless steel car, man. That thing is not cheap to fix, but let’s talk about the Mustang. Parts are coming off the shelf. You got parts everywhere for the Mustang. Yes. I have a Mustang, but I don’t have one of those Mustangs. I have a 65 Mustang. So I’m not one of those guys who’s going to pull out of cars and coffee.

But the bottom line was. We were a very litigious [00:36:00] state and I lived in Orange County over by Disneyland, which is considered one of the most litigious counties in California. This is all new to me. I born and raised there. I had no idea. I knew we all love to sue each other. We’re from California. That’s what we do.

It’s a hobby, but that was what pushed the insurance so high. So then we relocate to Texas. Cars are paid off, everything’s done, and we’re still status quo. We still have the Mustang, the Caprice, everything is still with. The Honda and the flex. So we get new insurance out here for the DeLorean. And the lady says, you have all these other cars.

Why don’t we go classic? And I said, well, how much does that going to cost? Unbelievable. I think for the DeLorean in California, and I’m stretching my long memory cells here, but I think we were paying right around 600 for a full year, full coverage on a DeLorean, we got here, all of the cars. On one collector policy, it was like 700 for all of them.

Full coverage, everything done. It was, it was beautiful. It really, really was.

Crew Chief Eric: So Jim, this brings up a really good point. Don mentioned it again, the declared value. Is there a minimum declared [00:37:00] value necessary to put a car on an insurance policy with collector auto insurance?

Jim Kruse: So technically there is, we’d like to stay at least 5, 000, but then you got parts cars and things.

I mean, this is where the conversation comes into play with the, with the concierge underwriters. Let them know what you’re doing. You might have two cars. You know, you talked about your 914, you might have your 914, you got a 914 parts car. So the 914 is worth 22, car might be worth 10, or 3, 000, whatever the number happens to be, right?

Those can both go on the same policy. They can. You just want to have a conversation. On these types of things for valuations, there truly isn’t anything written in stone. It’s a negotiation as far as things go. Don’s point there is exactly right. You move from Anaheim to Texas and the whole world changes as far as The liability side.

Now what he’s got in Texas, which he didn’t have in Anaheim, is hail storms, major rains, flooding. So no matter where you go, there’s issues. The difference is you can kind of protect your cars from [00:38:00] storms. It’s very difficult to protect them from crazy drivers in California. It’s just crowded. So yeah, there are differences in rates depending on where you are around the country, for sure.

Crew Chief Eric: We mentioned earlier that we’ve interviewed some track day insurance companies on this show before, and we definitely have an understanding of how they work and how they get applied in the claims process there and why and when you would purchase those track day insurance policies. So I’m starting to wonder though, there’s a subsection and an intersection between the classic car world and the motor sports world.

And you mentioned it at the top of the conversation. It’s the vintage and classic motor sports guys. So some of these old race cars are sitting in collections and whatnot, you know, maybe collecting dust or maybe getting fired up every now and again, just to run gas through the carburetors. But then there’s the guys that take them to the Monterey historics or take them to road Atlanta or different places, you know, with like, that.

Does the classic auto insurance policy cover them or do they need to also [00:39:00] purchase track day insurance on top of, and if something were to happen, how do you guys work together or not?

Jim Kruse: Any timed event, track event on a policy like ours is excluded. We don’t charge enough for it. I come from the world that if you can’t afford to fix it, you can’t afford to erase it.

That’s my background. That being said, it also makes people much quicker to remember there’s more than just the gas pedal to push if they’re paying for the damage. So I’ve always thought there’s a little bit of. Moral hazards here when you know that there’s a potential policy to fix the damage. That being said, there’s always significant deductibles to pay.

It’s not like you get away scot free. And I can’t tell you specifically because it’s not what we sell. HPD insurance. If you’re gonna go to a track event. Where it’s timed. I know there’s some gray areas when you talk about driving schools and a lot of them say that if there’s any passing that it doesn’t count as a driver school, there’s guys that have tried to get away with racing by calling it driver education and the companies are becoming a lot [00:40:00] smarter about those types of things.

It’s why today. I hate to say it, but there’s cars out there. You almost can’t get insurance for just because of the accidents that have been caused not all on tracks either, by the way on the road as well, but there’s high performance cars with people who just get out of their Honda and then go jump in their 400 horsepower rural drive, 1600 pound Cobra replica.

That’s a disaster waiting to happen. It just is. I mean, let’s talk about it this way to collector cars in general. It’s a niche of a niche because there’s a very small percentage of cars that are really collectors. 50 million cars on the road. There’s what, 10 million collector cars. So if you start talking about racing, Monterey Historics, everywhere you go, you pretty much see the same guys at every event.

SVRA, same guys going around the country. You got a few that do all the races and you got some regional guys. It’s a very small subset of the community. Anybody that’s doing that, they’ve got the fighter suits. They’re all the cars has to go through check. I’m not going to tell them anything here that they don’t already know as far as the coverage goes.

10 years ago, [00:41:00] very difficult to find. It’s much more common today. I’m still surprised that it is, but it is, you can buy it today.

Crew Chief Eric: So let’s just say I’ve got an old Triumph, you know, e prepared car. It’s collecting dust in my garage, even though it’s not road legal, that could be covered under classic car insurance.

I just want to make sure that that caveat is okay. As long as I’m not using it at a track day, I could be taking it to a show, something like that, where it’s basically static, it could be covered to protect it in case of an issue.

Jim Kruse: Absolutely. Hemmings did a story on one of my cars a few years ago. It’s up in the Auburn Core Duesenberg Museum right now.

It’s a 1938 Bowles dryer race car. It was that junk formula for IndyCar. It was right in between dirt and IndyCar. And it came out with a Spana Suiza engine. It’s got a dual overhead cam, Model B Ford in it right now. But that’s on a collector car policy right now. It’s my car, but I’m not racing it. But at the same time, I could still drive it if I wanted to.

But as long as I don’t take it on a dirt track. It’s no problem at all. So yes, we [00:42:00] have lots of race cars that are on policies. They just aren’t covered when they’re on the track.

Crew Chief Eric: Let’s unpack this a little bit more. There is a discipline inside of motorsports known as road rally used to be called Gymkhana, not the Ken Block Gymkhana that we’re all accustomed to today.

It’s an SCCA sanctioned. Quote unquote motor sport event, but it’s not timed. It’s more like touring and some of the things that the classic car guys do. If you’re at one of these Dominion Packard club or SCCA road rally or something like that, one of these sanctioned events, it’s not timed. Are you still covered

Jim Kruse: public roadway?

There’s no issue. My mom and dad did that in the fifties with a DKW of all things. I’ve never heard of a DKW before. One of the four rings of Audi. Yeah, that’s exactly right. That’s good. Yeah. Typically, that’s not an issue. Again, if there’s any question, I would always say, call your company real quick, send them an email, whatever you need to do and ask, but anything that’s on the road, if you’re breaking the road laws.

There’s a problem. Poker runs, things like that. That’s not an issue. [00:43:00] You’re just using the roads. Speed limits are the speed limits. That’s it. We potentially get in trouble is if it’s a timed event. Now, how many high school parking lots turn out to be an SCCA solo two type event? That’s a different thing.

And I would tell you the guys that are doing that, they pretty much understand how that works. If there’s a newbie coming along, it just doesn’t happen. People know.

Crew Chief Eric: I’ve seen it because I’ve been in these events. The folks that bring their vehicles to these tours, to these gymkhanas, these road rallies, by way of trailer, either open or enclosed.

We’ve asked this of the track day insurance companies as well. Is the car covered while in transit, if it’s on a trailer or in a trailer?

Jim Kruse: I would tell you in our policy, it would be. Not a problem. Comprehensive coverage, trailer upset. If you’re towing your race car, your on track physical damage, your HPD insurance is different than your off track and storage.

If you’ve got a race car and you’ve got a trailer, you’ve got tools and equipment, you can get what they call an off track and storage policy, which is strictly physical damage, no liability. [00:44:00] Trailer upset trailer stolen. That’s where that coverage comes from. You think about the insurance world, everything siloed, you got road, you got a garage, you got a racetrack.

There’s coverage for all of these different areas. It just might mean you have to combine a couple of policies. That’s the big thing.

Crew Chief Eric: So that also implies if you don’t keep your cars at your house, say they’re on loan to a museum or in a storage facility or something like that. Classic auto insurance covers that as well.

Jim Kruse: Yeah, absolutely. Yeah, though, we’ll want to know like what the other storage location is. And a lot of times if it’s at a museum, the museum is going to want to see where there’s proof of insurance anyway. We’ll send certificates to those locations to say, yep, it’s covered. It’s fine. You got a good museum.

So alternate garaging locations aren’t an issue.

Crew Chief Eric: So one last question. You brought it up. You talked about bad behavior on the public roads. So what happens in an instance where Maybe you were doing something silly in your classic car and you were pulled over, given a citation or whatever, have you, obviously the points [00:45:00] still apply to your license to you as a driver and all the reciprocity between states and all that kind of stuff.

But how does that affect your policy in any way?

Jim Kruse: It could be significant depending on what it is. I mean, we’ll take the most extreme example of DUI. I hate to say that it happens to people. Typically, it’s not intentional, but that means at least with us, you won’t get a policy next year. That will affect your other policies as well.

I mean, that’s a felony. If just a speeding, depending on the severity, everybody’s policies, your MVRs or your motor vehicle records are run through a system each year. And if there’s been any activity on there, they actually drill down to see what it was. If it’s a reckless driving, a hundred and a 65, again, that’s another reason to lose your policy.

Some companies, they can charge you a higher rate. If it’s not so severe that they have to like stop your policy and cancel it at renewal, they can charge you additional. But needless to say, nothing ever good comes from getting stopped. Bottom line, you’re never going to get a congratulations. You got a 20 mile an hour [00:46:00] ticket.

Thanks for being in our customer card. That’s not going to happen. Just try to avoid those situations the best you can.

Crew Chief Eric: Well, the opposite of that, is there the good driver discount?

Jim Kruse: Yeah, that’s true. Uh, there, there are, and uh, that’s kind of built into the base rate. I would tell you. That the best drivers on the planet are clients and your listeners, because the last thing you want to do is lose your license, what you love.

You can’t do, we actually find that poor driving among true collectors is never an issue where it isn’t issues. You’ve got somebody who just got a big bonus and now they go out and buy a 96 Viper for 40 grand, you know, same price as a Toyota Camry. It lasts about a month. And then go on Copart, and there it is, right?

Those folks, in my mind, they’re not true collectors. This year it’s a hot rod car, next year it might be a boat, two years from now it might be a helicopter. But your average car collector, the last thing they want to do is have a bad driving record and not be able to use your toys. That’s bad.

Crew Chief Eric: Like you, I get my speeding out of my system by going to the track.

So [00:47:00] that’s an easy solution.

Jim Kruse: You’re exactly right. And I will tell you, you mentioned cars and coffee a couple of times. I do a lot of speaking engagements at events. What I always leave with is there’s no better police than peer pressure police. And when you see people leaving cars and coffees or whatever it happens to be, and they’re being stupid, understand that their actions are going to affect everybody else that’s there.

We’ve all been at these shows now where they. Talk about no peeling out when you leave and those types of things, because it’s true. If you see anybody being stupid with a car, it’s very fair to go up and say, not cool, not cool. Because if you screw up, it’s going to affect all of us at that point.

Crew Chief Eric: And not to continue to beat that drum, but coming from the autocross world myself, it’s always something that we told people is when you’re leaving here, first of all, the cops are waiting for you.

And second of all, what you do within the vicinity of the autocross lot. Jeopardizes our ability to continue to have those events. Just be mindful of the rules of the road when you’re not at those events.

Jim Kruse: That is exactly right. That’s the downside of our hobby. And again, the newer, [00:48:00] faster, more affordable cars that we have today, it makes it very easy to have that right foot go all the way to the floor.

Nothing good comes Copart is.

Go to copart sometime and just click on exotics. It’ll break your heart when you see all those beautiful cars that are just sitting in parking lots, collecting dust, you know, 2000 miles on these cars and destroyed makes me want to cry.

Don Weberg: I hate to break up the party here. You know, Jim, you and I came to meet each other through a press release.

And it was about a new venture your company is getting into called Carnection. So why don’t we talk about that a little bit? Why don’t we tell the listeners what Carnection is? Why don’t you educate us about it? All we’ve got is that little press release.

Jim Kruse: Carnection Advisors is a company that I started about three years ago.

I would tell you after, again, 30 years in this business, one of the most frequent phone calls that I would get is someone who inherited a car. They didn’t know who to talk to. All they had was the insurance ID card and the glove box or under the seat. And what do I do? Throughout the years, I’ve [00:49:00] referred people to dealer friends and auction houses and things like that, that people didn’t want it.

And so 3 years ago, I thought the opportunity is here to pre plan what’s going to happen to these cars down the road. So everybody else pre plans for everything else in their life, but they don’t talk about their cars. And what I mean by that is, I’m not buying and selling. But just sitting down and making sure that all the documentation is done for a car.

There’s nothing worse than a car that I know is an incredibly special car that tons of money was spent lots of time, but no one ever documented what was special about it. You go to an auction and they can’t get a car started. And then you go over and show them, well, because there’s a toggle switch under the dash that the guy put there 20 years ago.

There, now you could start, well, that can mean world of difference in the sales price on a car. I mean, valuation goes. So what I do is what I did was you work with folks. Typically the wife is the most happy about this because unfortunately, gentlemen, in this world, we’re going to be the first ones to go.

The spouses are then [00:50:00] left with what the hell do I do now? You know, the obituary hits within 24 hours. The calls start hitting. Unfortunately, the people that are left don’t know what to do. So literally we come up with basically a drop dead book. In case something happens to me, here’s all the information on the cars.

Fred, the next door neighbor, I loved him. He’s going to get the 63 Corvette as opposed to Fred, the next door neighbor, who your husband actually hated is going to come over and say, you know, he promised me that car. I want it now. Cause that happens all the time. So you set all this stuff up front. You decide the guy’s got a 65 Mustang GT three 50.

They’re going to want to sell it. Dana does a great job selling American muscle cars. Oh, and they’re in Florida. Let’s sell that at the semi auction. So whoever is left when the time comes, they know exactly what to do with those cars, as opposed to. A dealer calling up and saying, Hey, I’ll take all those cars off your hands and I’ll give you X for them.

And this is their job. This is not belittling anybody. And they’re actually doing them a favor. My idea was to make [00:51:00] sure that the cars that are left, it’s a maximum payout for the family. And also thinking about the guy that did the restoration. You kind of owe it to him, especially for good cars, they get enough money for them.

Because all at once, if a car doesn’t run, when it crosses the auction block, everybody’s like, I thought Larry’s car, Eric’s car, Don’s car. I thought it was a better car than that. I can’t believe it doesn’t run. I’m really surprised. Well, you’re not there to tell them it doesn’t run idiots because you didn’t flip my safety switch, you know, things like that.

So we document all that stuff. And then we do what we call our virtual garage. We actually build an app. For each one of the cars, so it’s actually on their phone. So at the same time, all their information is ready to go. So if you want to share your car and all the information and all the documentation, it’s right there on your phone.

You can email it to people. You can show them at the car show as opposed to scrolling through all your pictures. To try to find pictures of your cars or your favorite cars. And so it’s a complete package. It could be a package they hold on for a year, 10 years, 20 years. I mean, like [00:52:00] any will you want to pre plan all these types of things?

Because I know we’re all going to live forever, but guess what? We’re not going to. It’s a tremendous amount of stress on the people left behind to deal with this stuff.

Don Weberg: So basically what Carnection is, it’s helping people organize their automotive properties for the next of kin. When we depart, you mentioned the wills, do you work with wills, trust, estates?

I mean, do you bring in the family attorney? I mean, we’re going to assume you’re the insurance guy of the family. So is there a banker? Is there a lawyer? Because obviously sometimes if you set up your trust, if you set up your will, that can conflict with what you’re doing here on the side. So how do we stop that?

I want my 65 Corvette to go to my neighbor, Bob, because he always loved that car. And he was always good to me and my dog and my wife and all that. But, oh God, I forgot about my will, which said I’m leaving it to cousin Tony back in Jersey. Back to the silo idea,

Jim Kruse: most financial advisors, most attorneys, the cars and things like that are kind of in all other category.

And so basically what we [00:53:00] prepare, then that’s presented to whoever their advisor is. And again, you have two, you’ve got your attorney for the legal side. I’m not an attorney. Thank goodness. But then you also have financial side. You look at people’s balance sheets, you know, they’ve got their 401ks, their savings, their stocks.

And over here, they’ve got other another could be guns or whatever else. A lot of times it’s cars and the financial advisor says, and what’s that car worth? Oh, I know. I bought that car in 1967. I guess it’s probably worth. I don’t know. I paid 30, 000 for it back then. I haven’t been paying attention. Let’s just say 200, 000.

Okay. And then it turns out to be a 67275 Ferrari 4 cam, you know, for 3 million. That actually has happened. When people get older, sometimes they forget and they don’t pay attention to values. We do because it’s the business that we’re in. Some people don’t. So all at once. This all other number over here, which is 200 grand might be worth double what the rest of the estate is, which changes everything from a financial planning perspective.

At that [00:54:00] point, that’s what gets missed. Stocks, bonds, real estates, gold. Easy. I can tell you spot gold right now. 1, 697 an ounce. It’s much more difficult to value the stuff that we like. You’re better off doing that earlier rather than later. Part of that also is videos. We all want history, right? There’s no better history than the guy that restored the car to tell you what he did.

This is all part of it. You’re hearing their words. This is what I did. My car. This is why I love it. So eventually when you end up with it, that continues on with it. This is the story as much as anything. And that also helps you in a world perspective.

Crew Chief Eric: Yeah. I love this whole estate planning for the cars and the vehicles.

I mean, it obviously incorporates motorcycles and everything else along with it, but it brings up a really good question because as we rewind the clock and look back over the year, we’ve seen the Gene Ponder collection. We’ve seen the Jim Taylor collection. We’ve seen a lot of other ones come to the table and it’s not just the cars.

It’s the collection. So say you have a Lotus, you [00:55:00] have all the Lotus paraphernalia and memorabilia and everything that goes with it. Is that included in that package as well? Is that documented in the process?

Jim Kruse: It certainly can be. And I would tell you that a memorabilia person and that’s not my expertise, but there’s people out there that aren’t that.

I mean, you’re talking signatures and all the rest of these things that you got to document. It’s the car side, which typically is the biggest piece of those collections. I mean, you can get into toys. All the Petrolina stuff. I mean, it’s incredible. The majority of the people though, honestly, that this is an issue for are people with probably five cars or less.

The big auction houses aren’t knocking down their doors because they kind of don’t know about them. It’s people that haven’t been involved in the hobby for a while because they’ve gotten old, which is, I hate to say it, a big part of our hobby right now. It’s an aging. Either have the very young folks or very old folks, but all that stuff can be incorporated where right now, typically it’s not.

And when you fill out your asset liability and balance sheet, the person you’re handing this stuff to is just taking your [00:56:00] word on those valuations and then. When you do need to dispose or develop your succession plan, it’s just too hard when the person who put the collection together is gone. And for a lot of people, four or five cars, that’s a significant collection.

The average owner owns one and a half cars. When you start dividing things up, about one and a half is what most collectors have. But then you’ve got huge collections, right? But at the end of the day. It’s the little guys that need the help with this. And sadly, they’re the ones that a lot of times it’s too late to get any help for them, just the way that it goes.

And that breaks my heart. Again, we all know stories of someone getting, whether it was a neighbor, whatever it happens to be, that kind of got taken advantage of by someone. It’s just sad.

Crew Chief Eric: Is the Carnection app, let’s call it that, included when you buy a classic auto insurance policy or is that something separate you got to get?

What does it cost?

Jim Kruse: Yeah, it’s a separate business, completely separate business. You do not have to be a classic customer for this. And typically it’s a percentage. It’s a fee based. Model, just like you would go with [00:57:00] a fee based financial advisor, you’re looking at anywhere from, you know, a half to one and a half percent as a valuation of the collection.

So you’ve got 100, 000 in cars, let’s say might cost you 1500 total, but with that, you’d get the whole peace of mind of what’s going on and, uh, what’s the rest that’s going to go someday. That’s huge. The other side of it is. It makes you a very attractive prospect for a dealer or an auction house because they don’t need to do any research done on the cars.

It’s done. You hand it to them. Typically, if they’re going to bring in a car or cars, especially special cars, they’re going to go through and do all the documentation and pull all the paperwork. Well, that’s kind of what we do. We scan it in, build your own file for you, and it’s all ready to go. It’s amazing how many times we’ve heard about people when somebody dies, they know the car’s worth a lot of money, but there’s all this paperwork.

Just pitch it. It’s just old receipts and things. Well, that was everything that was ever done to those cars. Back to the story of what we like. You just threw away 10 of [00:58:00] the 12 chapters. Of that vehicle because you didn’t know, but once you digitize it, it’s there forever.

Don Weberg: You brought up a lot of the big collections of big collectors, etc.

And you said the little guys are the ones who normally need the most help with this. And I kind of agree. Let’s take my cars, for example. Yeah. None of them are what you would call important collector cars. The DeLorean and the Mustang might have a little bit, the DeLorean would, but the Mustang might have a little say in something.

But all the rest of my cars are pretty darn basic. Is that a customer that you would want to have? Or are we looking for the guy who has the Corvette with the racing provenance or the Bugatti that was shown at the Paris something or other show in 1940? When we talk about Bugatti, for example,

Jim Kruse: there’s no issues.

Everybody knows those cars. No matter what he says, all those cars are known. Sure. They might find it cause it’s been 30 years since it’s been shown, but people know those cars, the cars like you have. Depending on your situation. Yeah, it could be. I mean, if you don’t want from an estate perspective, your spouse, your [00:59:00] kids, whatever, hassle.

And again, sadly, the other reason why this has come up is because most families, the children want nothing to do with the cars. All they want is the money. I’m unique in that I’m a second generation person. It just doesn’t happen. All the kids I grew up with in the car hobby. I don’t think any of them stayed involved.

They got burnout. Their parents drug them to every car show when they were under 18. And as soon as they got out of high school, they lived a lifetime of cars in 18 years. They never want to see him again. Even your cars, if it’s nothing more than just to formally establish where your DeLorean is going to go, you know, it’s a 40, 50, 000 car.

Depending on your state, that’s significant. That’s a lot of money. And it makes it easier for whoever might be left to dispose of those cars to know right up front. This is what it’s worth. This is where it’s going. Here’s an offer. Or it could be the neighbor or it could be a grandkid, but you want to establish that stuff up front.

It’s really not even a value perspective, peace of mind on where these things go. And it may not seem like a lot of money to you 10, That’s a boatload of [01:00:00] money for a lot of people. And there’s a big difference

Don Weberg: between 15. You mentioned this is where this car is going to go. You said that is their hand holding.

I’ll just call it that from your company. Like, let’s say I croak right now drop dead. You and I fortunately went through and documented all my cars. We got them all in video and books and receipts and all this digitizing and all this other stuff. So my wife and my daughter, what do they do now? There’s a book, there’s an app, there’s a phone number.

Jim Kruse: It’s amazing how strong spouses can be when they at least have some direction. What they’ll have is a guide of exactly who they need to call when, you know, sometimes the best thing to do is don’t do anything for a year or six months. I mean, and you tell everybody that calls nothing’s happening, whatever.

We absolutely can shepherd them through that process. But the idea is if I get hit by a bus. Or someone else who’s worked with them gets by a bus, they literally can open that book. And we decided upfront that 65 Mustang is going to get sold at the sale [01:01:00] because it makes the most sense. Whether it’s a Mecham January auction or whatever happens to be, let’s say, then they just pick up the phone and call and say, Hey, Carnection put this together for us.

Here’s where we’re going to sell the car. They’ll be thrilled to talk to them at that point. It’s not difficult. I mean, those folks are very good at managing that process of then shipping the car. At that point, they might have to do a little spit and polish and maybe they haven’t run for a while. That’s what those groups do for you.

But it’s very simple. But we can do as little or as much as they want. But in the end, they can do it all themselves. That’s the whole idea.

Don Weberg: Your company would be there for them if they needed a little help or a lot of help or no help. They can make that decision.

Jim Kruse: Absolutely. I told a lot of people this, I’m doing this for total selfish reasons, because someday I’m going to have to do this for myself.

I already have. It’s probably my wife someday going to have to put up with this stuff that I’ve forced upon her our whole lives. It’s just the way that it goes. It’s kind of paying it forward here a little bit. And honestly, from our perspective, we’re not talking a lot of money. This is not a big moneymaker for us.

It’s more helping the [01:02:00] community. As much as anything, only because we know it’s just a tough spot for those people left behind to have to deal with and have a disinterested third party. You’re going to have no interest in the cars. They’re not helping selling. We don’t get anything. Many of you refer them too.

It doesn’t make any difference. It’s just, in our opinion, it’s the best place for them to get rid of those cars or do whatever they want with them at that point.

Crew Chief Eric: I want to remind our listeners though, that even though Carnexion is an awesome service, I love this whole concept and this whole idea. It is not And I’m going to say it again is not a replacement for your will trust or a state plan and you still need to pay your state taxes, your probate or however you want to set that up.

It’s not going to get taken care of for you through this ancillary service. This is an augmentation of your existing will or trust or a state plan or whatever it is.

Jim Kruse: That’s exactly right. We’re not attorneys. All we’re doing is helping people get pointed in the right direction because there’s a lot of directions they can go.

And it can make a huge difference [01:03:00] financially for them where they choose to manage that process. That’s it.

Crew Chief Eric: All right, Jim. Well, we’ve come to that point in the episode where I get to ask you if you have any shout outs, promotions or anything else you’d like to share with our audience that we haven’t covered thus far.

Jim Kruse: If you’re thinking about an insurance decision, always think about us at Classic Auto Insurance in Indianapolis. If you’re ever in the Indianapolis area. Got a neat office, stop by, got a lot of cool cars in our back room that you’re more than welcome to show to you. I appreciate the opportunity to

Don Weberg: come here and tell our story.

The truth of the matter is, everyone should be using classic and collector car insurance instead of their generic carriers. Classic auto insurance offers specialized classic car insurance coverage you just won’t find anywhere else. Their goal is to offer clients a tailored insurance policy that is as unique as the collection in their possession.

Coverage which will help them protect and pass on the legacy they have worked so hard to build. To learn more about Classic Auto Insurance or get a quote online, be sure to log [01:04:00] on to www. classicins.

com. Dot com. That’s classic IN s.com, or follow them on social at classic auto ins on Twitter, at classic auto insurance, on Facebook, at classic ins on Instagram, as well as on LinkedIn, Pinterest. And don’t forget about their YouTube channel.

Crew Chief Eric: That’s right, Don. And Jim, I can’t thank you enough for coming on Brake Fix and sharing your story, telling us about classic auto insurance and carnexion.

And you know what? I’m going to add this to the column of things I didn’t know existed, but I am sure glad I do now know about it. So thank you again for sharing your knowledge. educating us and our audience. I think it’s important to both of our worlds, right? Don’s bringing the classic car guys from GSM.

I’m bringing the motorsports guys and here we are all sitting at the table together having a great conversation. And you know, what’s really special about this is [01:05:00] that when you call classic auto insurance, you’re talking to car people, not a bunch of math nerds that are just looking at amortization tables and whatnot.

So it’s nice to know that you can pick up the phone. Have a conversation with car people from car people to car people. So that’s pretty awesome.

Jim Kruse: These are fun. And if you ever need anything else or anything more specific, don’t ever want to talk about brass cars. Call me. Thank you very much. It’s been great.

Appreciate the time. Thanks, Jim.

Don Weberg: The following episode is brought to us in part by garage style magazine. Since 2007, Garage Sale magazine has been the definitive source for car collectors continually delivering information about automobilia, petroleana, events, and more. To learn more about the annual publication and its new website, be sure to follow them on social media at Garage Style Magazine or log on to www.

garagestylemagazine. [01:06:00] com because after all, what doesn’t belong in your garage?

Crew Chief Brad: If you like what you’ve heard and want to learn more about GTM, be sure to check us out on www. gtmotorsports. org. You can also find us on Instagram at GrandTouring Motorsports. Also, if you want to get involved or have suggestions for future shows, you can call or text us at 202 630 1770 or send us an email at crewchief at gtmotorsports.

org. We’d love to hear from you.

Crew Chief Eric: Hey everybody, Crew Chief Eric here. We really hope you enjoyed this episode of Break Fix and we wanted to remind you that GTM remains a no annual fees organization. And our goal is to continue to bring you quality episodes like this one at no charge. As a loyal listener, please consider subscribing to our Patreon for bonus and behind the scenes content, extra goodies, and GTM swag.

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