Once you purchase a car, your insurance policy covers the car as it was as it left the lot. When any changes are made to the car, these are considered modifications, and the insurance company needs to be notified. Modifications can be for aesthetic, performance or safety reasons, and each can have a different effect on how much modification insurance will cost.

Modifications that Raise Premiums

Modifications that change the look or performance of a vehicle typically require specific car parts, which can lead to more expensive parts and repair in case of an accident. Some insurance companies will not provide enough coverage for certain modifications, and a car owner may have to turn to companies that provide insurance to luxury or vintage vehicles to fully protect their investment.

Modifications that can increase yearly premiums can include:

Lift kits
Custom paint jobs
Chrome rims
Engine swap

Modifications that Decrease Premiums

Insurance companies view modifications that provide extra safety or security as an advantage and will offer discounted rates on modification insurance.

The types of modifications that insurance companies like to see include:

Anti-theft systems
Daytime running headlights
Adaptive headlights
Rearview cameras
Blindspot detection

If an accident occurs, the company can refuse a claim if they did not know about modifications to the vehicle. To avoid this, as soon as modifications are made, notify your insurance company to discuss the premiums.