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Modified Car Insurance

01 Oct

If you’re considering modifying your car, first consider your modified car insurance premiums. It can be difficult to obtain cheap modified car insurance for a modified car. The most important thing to understand is how cheap modified car insurance companies determine the premium rates. Basically, they consider both your risk profile and that of the car.

Types of modified street cars

There are two types of modified street cars: street racers and show cars. Street racers are more likely to be involved in accidents and are driven in all types of weather. They are driven fast at high RPMs and are more likely to be stolen. Insurance companies also assume they will be driven by a racer, a higher risk group.

Show cars usually have very low mileage, typically only in good weather, and are usually driven very carefully or trailered to events. Show cars are generally parked in a garage overnight, so they’re less likely to be stolen. Therefore, street race cars will be more expensive to insure than show cars.

Types of modifications

There are several levels of modifications, from small changes such as alloy wheels to major ones like a forced induction system. Your insurance premiums won’t be impacted much from small modifications, and you can sometimes avoid premium increases through security measures like alarm systems or locking wheel nuts. Major modifications, however, cause larger increases in your premiums because they increase the risk your car will be in an accident. Insurance companies typically consider other modifications on a case-by-case basis, such as performance exhaust systems or lowering the suspension.

Disclosing modifications

Although you might be tempted to not inform your insurance company of any modifications, this is a bad idea. If you do not disclose modifications, you will not be covered in the event of an accident. Your insurance company will probably void your policy if they notice any modifications you haven’t disclosed. These include seemingly minor modifications such as alloy wheels. After you have purchased a policy, you must disclose any modifications.

Finding the best coverage

You will need to carefully research this issue. If you have already modified your car, research online or by phone to get the best quote. Don’t forget to learn if there are any extra deductibles in case of accidents or theft. If you are still planning the modifications, check with your current company to see how your planned modifications will impact your premiums, then research to see if another provider can offer a better rate.

What to do in the event of an accident

Depending on the amount of damage, the insurance company will decide whether your car is totalled by comparing the repair costs against the car’s value. For modified cars, your car’s estimated value can be a matter of great debate. Modifications can increase how much money you’ve invested in the car, but it doesn’t necessarily result in a corresponding increase in the car’s value. For example, if you have added an expensive stereo system on a less-expensive car, it won’t increase your car’s value by the value of the stereo. In these cases, you can sometimes keep the equipment to use on your next car.

Following an accident, the auto insurance company will determine your car’s estimated value. They will send your car’s information to be evaluated by another company, which compares recent selling prices for similar cars to determine an average worth. You should conduct your own research at the same time. Look for recent sales information on similar cars based on year, mileage, options, and modifications. Try to find cars that hold sold at a relatively high price but are in worse condition than yours. This gives you more leverage to argue with the insurance company if they come back with a low value for your car.