Race Car Insurance


Insurance companies sell car insurance policies at very competitive prices. However, when it comes to driving a car on a racing track, insurance policies are highly expensive. Most insurance companies deny selling insurance policies for such a purpose. There has been no public debate about this topic so far. This article explains this issue and encourages car lovers to talk about this issue publicly.

First and foremost, let’s analyze how do insurance companies work. Insurance on public roads is an absolute necessity, and this is why governments make sure that there is a legal infrastructure for insurance companies to develop and sell such policies. So, private insurance companies come in the game, insure cars to protect drivers from excessive financial loss, and also make a profit.

Racing-Cars
Racing Cars

Car insurance companies make a profit by subtracting the money that they paid towards car accidents and damages by the total net revenue of all insurance policies they sold in a given period of time. For example, Let’s assume that one thousand drivers bought an insurance policy for their car that cost one hundred euros each. The total revenue for the insurance company would be one hundred thousand euros. However, the total amount of euros that the insurance company paid towards accidents covered by the insurance plan was seventy thousand euros. The insurance company also had operating expenses of twenty thousand euros. This means that it made a net revenue of ten thousand euros. This is the principle based on which insurance companies calculate the price for the insurance policies they sell. The fewer the accidents on public roads, the lower the losses for the insurance company, and therefore the larger the net revenue. When this happens, insurance companies can sell policies at a discounted price, and that’s how they become more competitive on the market.

Race-Car-for-Car-Lovers
Race Car for Car Lovers

However, when it comes to selling insurance policies to drivers or cars that will be used on a racing track there is a big issue. Insurance companies either don’t sell such insurance policies at all, or they sell them at very high rates. What’s the reason for this? They claim that the reason is that the risk for an accident on a racing track is very high. The higher the risk, the higher the price of the insurance policy normally is.

But this is not true. Racing tracks are very safe places to drive a car, and it’s very rare to have an accident. Racing tracks meet very high security specifications, driving direction is only one way, and there are a lot of security briefings from the organizers to make sure that everyone is safe.

Race-Car-on-Racing-Track
Race Car on Racing Track

Many people want to rent a race car on a racing track. Those people buy personal accident insurance policies at very low prices, but for driving the car for half an hour on a racing track they have to pay astronomical amounts of euros to insurance policies. There are no statistical data proving that racing tracks are places of high risk. This is because security measures are so high that there are almost no accidents.

There are many car lovers who enjoy driving cars at their own desire for speed, but this does not mean that this happens under unsafe conditions. As many non-race drivers are interested in living the experience on a racing track, the more public awareness around this issue there is. Spread the message, and let’s all together make it clear that insurance companies should sell policies for driving on a racing track at lower prices.

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