Whenever a Formula One accident happens, at least someone watching thinks aloud, "that has to be a lot for car insurance".

Anyone would be speechless if they saw what something as little as a dent on an F1 car could cost to fix. However, it's not exactly a lot for a car insurance provider because they aren't providing coverage whenever the car is on track. F1 cars aren't insured in the traditional sense, but there is no official race car insurance policy. It's not a question of if the provider has to payout; it's a question of when because there is no riskier driving than out on the track. For that reason, the teams themselves bear the responsibility for any damage that occurs to their car during a race.

Are Formula One Cars Required to Get Car Insurance?

F1 cars are never used on public roads, so there is no legal reason why they would be required to get car insurance like any other driver. No insurance company will want to underwrite an auto insurance policy for cars used for racing events in general. The same is the case for NASCAR as it is for Formula One. However, a comprehensive auto policy can be underwritten for the car while it is being transported between events. Obviously, no one is driving the car to and from the stadiums.

How is Damage to a Formula One Car Covered if Not With Standard Car Insurance?

The car's team will handle any damage it sustains during the racing season with a budget they set out reserved only for repairs. They are in a way self-insured. That should give you an idea of how expensive F1 repairs can get when they have a whole percentage of the racing team's budget for it. These can be million-dollar repairs. Mick Schumacher ran the largest repair bill last year with $4 million. This also takes circumstantial damage during transport which is unavoidable for F1 racing teams. They will always use a portion of their budget by the end of the racing season, guaranteed.

How do Formula One Teams Pay For Damage to Their Cars?

Formula One racing teams are able to put together a damage budget with the proceeds from their corporate sponsors mostly. They will also set aside spare working parts for future use should they be required. With as much planning as it sounds and the amount of money it may require, teams covering themselves with their own funds is cheaper than them buying a car insurance policy.

When Does Car Insurance Cover a Formula One Car?

As previously mentioned, when a car is being transported by truck or container, it can be insured by a comprehensive car insurance policy. Any damage sustained between events can be insured along with criminal damage like theft. It's not an entirely risky deal to insure a Formula One car while it's being transported because they are often safely and securely stored.

How Expensive Can Formula One Car Damage Get?

Damage is common in Formula One racing, so teams are prepared to put in at least one hundred thousand dollars in the reserves should anything happen. Rebuilds and damage to the car's engine can result in repairs in the millions. These are specialized racing machines with parts not found on the regular auto market. It goes to show that insuring them is a cooperative effort between the team and a car insurance provider.