Inflation guard is a feature of some specialized classic car insurance policies designed to protect the entire investment in your collector car.

Most regular cars depreciate in value. In fact, you probably know that when you drive a new car off the lot, before you even hit the curb into the street, your fancy new wheels have lost about a third of their value. Not so with classic and antique cars. Most often, they actually appreciate in value.

That's why specialty classic car insurance policies provide Agreed Value coverage. At the time the policy is written, you and the insurance company agree on the value of the car and that's the amount you're covered for.

But if the car is appreciating rather than depreciating, you will soon be underinsured. A policy with an inflation guard clause will actually increase the agreed on insured value of your car automatically each quarter—often by 2% for a total of an 8% increase for the year. Then your investment is more fully protected by your classic car insurance in the event of a total loss.