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The best way to a man’s heart may be through his stomach. But if he happens to be well-to-do, you might want to start in the garage.
People who own rare collector cars are incredibly passionate about their vehicles. They’re also in many cases just the kind of clients TDC Cos. is geared toward. So about three years ago, the Maumee-based financial services firm began selling collector car insurance as a way to reach new customers.
To do so, it partnered with Barrett-Jackson Auction Co., a well-known outfit that hosts several big auctions around the country annually. The private-label insurance TDC sells is specifically promoted and endorsed by Barrett-Jackson.
Cleves Delp, chairman and chief executive officer of TDC, said it has been a good relationship and has done what it was intended to do.
“Although we’ve become quite proficient and extremely competitive at insuring collector cars, our strategy is to access the right profile client through their collector car collection. Through the garage into the house,” he during a recent interview at the company’s Arrowhead Park headquarters.
TDC caters primarily to wealthy and ultrawealthy clients, with business groups focusing on property casualty insurance, group benefits, wealth management, and estate and life insurance planning.
In a way, TDC already had been insuring cars before establishing its arrangement with Barrett-Jackson, as many of the clients served by its high-end property casualty business own collectible cars. But the specialty now gives it greater reach into a thriving niche market.
The most recent Barrett-Jackson auction was in January in Scottsdale, Ariz. The auction generated sales of more than $108 million and included more than 1,300 vehicles, including a 1968 Chevrolet Corvette L88 race car that had once been sponsored by Owens Corning. That particular car sold for $1.1 million.
Some 300,000 people attended the event, which is the company’s largest of the year. TDC was on site, providing nearly 300 quotes to buyers and car owners. Jim Schwarzkopf, principal with TDC Risk Management, said those figures speak to the health of the collector car market.
“It’s very robust,” he said. “People are seeing these vehicles are holding value and appreciating in value, whereas in some of the other asset classes, they’re not seeing that same type of return. There seems to be a real interest in buying collector cars right now.”
The next Barrett-Jackson auction begins today in Palm Beach, Fla. Among the cars being offered are a 1969 Jaguar XKE roadster with 10,385 miles, a 1937 Cadillac seven-passenger limousine, a 1970 Oldsmobile Cutlass 442 convertible, and a 2003 Aston Martin DB7.
Mr. Schwarzkopf said TDC insures more than $750 million worth of vehicles, ranging from collections of a single car to a 1,100-vehicle group.
“We’re equally as happy to write either one of those [policies]. You never know. That person who has 1,100 started with one,” Mr. Schwarzkopf said.
Mr. Delp’s father started the business that eventually would become TDC in 1958. Since then it has grown considerably, especially in the last few years. Five years ago, the company had 20 employees in Maumee. Now it has 60.
TDC does have local clients, but many of its customers live on the coasts and other areas where wealth tends to gather. That’s especially true for the group’s athletes-and-entertainers business, and TDC has about 30 employees across the United States to work with those clients. But Mr. Delp said there are good reasons for keeping his home base in Maumee.
“The work force here is as competent, hardworking, and trustworthy as you will find anywhere,” he said. “Good Midwestern work ethic is not to be discounted. And the cost of living — it costs less to do business here than it does in other parts, so what a great advantage.”
He credits that cost of doing business as one reason for TDC’s success. The other, he said, is that TDC does things differently from others in the game. With collector car insurance, that means viewing the vehicles more as artifacts than automobiles.
“Which is it, is it a car, or is it a collection?” Mr. Delp asked. “What we have found is that most collector car insurance is overpriced because the traditional insurance companies insuring them are nervous about a $150,000 car. What we know about that is the owners of these cars treat these cars better than their children.”
In addition to collector cars, TDC also insures other high-end collectibles, including art and jewelry. It’s also looking to add other specialty insurance, including for wine storage outfits and an equestrian group.
If you need to insure yourself, TDC also sells ransom and kidnap insurance.
“Executives and corporations buy that stuff. They worry about those things,” Mr. Delp said.
Contact Tyrel Linkhorn at: email@example.com or 419-724-6134.