Car insurance can be a fickle thing. Your premium is based on a variety of factors, ranging from the type of car you drive to your personal driving record to where you live.
With one of the most important factors being the type of car you’re driving, it should come as little surprise that your insurance company is quite interested in the details if you plan to modify your car.
In fact, it’s vital to contact your insurance company if you plan to or have made any modifications to your vehicle.
If you’ve made a modification to your car without consulting or informing your insurance agent, there is the possibility that you’ve actually violated your insurance policy. You might be driving around uninsured.
Why Vehicle Modifications Affect Insurance
There are two key reasons why modifying your vehicle can impact your insurance:
- It can affect the safety and performance of your vehicle
- It can affect the overall value of your vehicle
You’ve probably noticed that when applying for insurance you are required to provide the details about your vehicle's make and model.
This information lets the insurance company make estimates of price based on how safe the vehicle is (based on its performance and safety record) as well as allowing them to estimate the overall value of the vehicle (based on its value on the market.)
Any modifications to these two elements will affect the insurance company’s appraisal of your vehicle, and hence can affect your insurance policy.
In some cases, the effect might be raising your insurance premiums, but in the worst case scenario it could mean termination of your insurance policy entirely.
Modifications Impacting Vehicle Safety
If you plan to make any modifications to your vehicle which change how it performs, it is vital to contact your insurance agency beforehand to understand how this will affect your policy.
Changes which might impact performance and safety include:
- Modifications to the engine
- Modifications to the vehicle’s suspension
- Modifications to the brakes or braking system
- Modifications to the vehicle’s transmission
- Increasing or decreasing the tire size
- Tinting the windows
If you’re looking at making any of these modifications, take into account that they may raise your insurance premiums or force you to seek a new insurance agency which is willing to insure a modified vehicle.
Modifications such as lowering the suspension and altering the size and/or power of the engine are often considered to put the vehicle at higher risk of being in an accident. These are the types of modifications that are most likely to impact your insurance premiums.
Modifications Impacting the Vehicle’s Value
Unless explicitly stated in the policy, most insurance policies do not cover aftermarket parts, or offer only a small allowance for aftermarket modifications.
This means that if you want to add something to your vehicle which increases its value -- such as an expensive aftermarket stereo, custom paint job or aftermarket rims -- these additions to your vehicle may not be covered under your insurance policy.
In some cases, these modifications can even void your insurance policy. Some insurance agencies view these types of modifications as increasing the risk of theft or vandalism to the vehicle.
If you’re planning to modify your car with aftermarket parts and want them to be covered, you can expect your insurance premiums to rise. Contact your insurance agent to discuss the details and find out how much coverage is available for vehicles with these types of modifications.
Always Notify Your Insurance Agent About Modifications
When modifying your vehicle or purchasing a modified vehicle, it is imperative to inform your insurance company about the modifications.
This is a responsibility placed entirely on the insured. It is not the duty of the insurance company to inquire about or investigate modifications.
If you are in an accident in your vehicle and later it is determined by the insurance company that your vehicle was modified and you failed to inform them, your insurance could be revoked, leaving you liable for the damages and cost of the accident.
For customized vehicles with extensive modifications, it may be necessary to look for a specialized insurance agency which deals with modified vehicles, as standard insurance companies may be unable to insure the vehicle.
Want to Know More About Vehicle Modifications?
Your car is your pride and joy. If you want to make her even prettier than she already is, feel free! Just make sure you still have the right coverage. It can be a confusing topic to wade through on your own. That’s where a broker can help. Before you make any changes, give us a call. We’ll help you figure out how it will affect your insurance, and how much it’s going to cost. Don’t do it alone! Let us help you stay protected while you build your dream car.