Stolen Antique Cars: A Problem and a Proposal (Spring 2002)
By Ted Ritter
In August 1995, a friend of mine bought his dream car: a 1957 Chevrolet convertible. The car needed mechanical work, but was solid and driveable. He found it through a private classified ad in the Philadelphia Inquirer.
My friend already owned two 1957 Chevrolets, but he’d always wanted a convertible.
Fast forward to the Summer of 2001. Surprise! A telephone call is received from the Linwood office of the Federal Bureau of Investigation. The FBI is investigating a tip that the car my friend had purchased six years earlier had actually been stolen in the early 1990’s, in Florida. The thief, or someone working with him, had allegedly switched the Vehicle Identification Plate on the driver’s door hinge post.
My friend’s car – now worth upwards of $30,000.00 – is confiscated by the FBI!
The Bureau kept my friend’s car for four days. The good news is that the informant’s tip didn’t pan out and the vehicle was returned.
Stolen antique car listings are published monthly in Hemmings Motor News. In the December 2001 issue, the stolen antique and collector cars included a 1967 Mustang, a 1956 Chevrolet, a 1931 Ford Model A Roadster and a 1974 Corvette.
What can a car enthusiast do to protect himself from unwittingly buying a stolen collector car?
Paul Snyder of Farmers and Zurich Personal Insurance, indicates that the recovery rate of stolen antique and collector cars is only 10% compared to a 60% recovery rate for non-collector stolen cars. Mr. Snyder advises that the unrecovered collector cars are “parted out” or shipped out of the country to foreign buyers.
Mr. Snyder also cautions that antique auto insurance does not insure your ownership of your vehicle (i.e. your “title”). If a law enforcement agency confiscates your antique car, there is no insurance coverage presently available in the marketplace that will reimburse your loss.
One way of protecting yourself is to buy antique or collector automobiles only from a reputable dealer. The downside is that you’ll probably pay a premium price and you are limited to the selection of cars the dealers have for sale.
Another option is to ask your local police department to search the VIN of your prospective purchase through the National Crime Information Clearinghouse (NCIC). But what if your vehicle identification plate has been expertly altered or if the plate itself has been switched?
In the final analysis, there is no foolproof protection from a clever crook unloading a stolen collector car on a trusting, private buyer. Furthermore, it is quite likely the person from whom you buy your antique or collector car is several buyers removed from the actual thief. This was the situation with my friend’s 1957 Chevrolet.
Is there any other answer to this dilemma? I think there is, and I have a proposal.
Real estate title insurance is widely available and frequently purchased. The cost is moderate. In New Jersey, real estate title insurance costs $5.25 for every $1,000.00 of coverage. That rate drops if a title insurance policy has been issued, within the last ten years, insuring the last Deed of Conveyance.
Title insurance companies charge extra for the County, Upper Court, Tax and Assessment Searches. They also charge a separate fee for conducting the “closing.”
Why can’t the antique and collector car insurance industry make title insurance available for antique and collector cars? The insurance company can either elect to search the back title of the proposed insured vehicle or simply accept the risk in return for receiving a premium. In this way, the risk of loss is spread out among all antique and collector car owners who elect to purchase title insurance. That principle is, in fact, the foundation of all insurance – spreading out the risk while allowing the insurer to make a reasonable profit.
Under my proposal, the private seller or dealer would complete an Affidavit of Title. The car buyer would pay the premium to insure title to his new purchase for a stated value – usually the purchase price.
Antique auto title insurance, like real estate title insurance, would only require a one-time premium. The title policy would remain in force for as long as you own the car.
If you are buying a $25,000.00 antique, wouldn’t you be willing to pay an additional $150.00 or $200.00 to insure your title?
If antique car title insurance became available, I would certainly take advantage of it!
While writing this article for Cruisin News,I checked with seven different antique car insurance companies that advertise in collector publications. None had ever heard of antique car title insurance and, obviously, none offered such a product.
I suggest that this is an idea whose time has come.
The Ritter Law Office, L.L.C.
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