Thinking about adding alloy wheels or upgrading your sound system? While these upgrades might enhance your car’s performance or aesthetics, they could also leave you out of pocket if they aren’t properly covered by your insurance.
The Financial Ombudsman Service (FOS) has noted a growing number of cases where vehicle owners are faced with costly repair bills because they failed to inform their insurers about modifications. So, what exactly counts as a modification, and how can you make sure your insurance covers these changes? Let’s explore everything you need to know before customising your car.
What Qualifies as a Car Modification?
Any alteration to your car that changes it from its original factory condition is considered a modification. This could be something as visible as a custom paint job or as subtle as upgrading the exhaust system. Even engine tuning or fitting new alloy wheels count as modifications.
The important thing to remember is that not declaring these modifications can invalidate your insurance. In the unfortunate event of an accident, your claim might be rejected, leaving you to cover the costs. What’s more, even minor tweaks like installing a new entertainment system or tinted windows can lead to increased insurance premiums.
Many drivers aren’t aware that modifications must be declared. One common situation reported to the FOS involved a driver whose car was stolen. It was only when they tried to claim that they discovered their insurance was invalid because they hadn’t informed the insurer about modifications made to the vehicle. Had the insurer known about the changes, they would not have issued the policy in the first place.
Insurers and Modifications: A Cautious Approach
Insurance companies view modifications differently than car enthusiasts might. While you may see a new exhaust system or high-performance brakes as a valuable upgrade, insurers assess modifications in terms of the risk they introduce.
Modifications can impact the car’s value, performance, and likelihood of being involved in an accident. For example, a turbocharged engine or enhanced suspension could tempt the driver to push the car to its limits, increasing the risk of a crash. Similarly, flashy alloy wheels or expensive sound systems may make your car more attractive to thieves.
One case the FOS dealt with involved a driver who installed alloy wheels just three inches larger than the manufacturer’s standard. When the insurer voided the policy and rejected the driver’s claim following an accident, the FOS ruled in favour of the consumer. The reasoning was that a typical driver wouldn’t notice the difference in tyre size, making the insurer’s actions unreasonable. Nevertheless, this highlights the importance of knowing your insurer’s specific terms regarding modifications.
Why Declare Modifications?
Honesty is always the best policy when it comes to car insurance. Failing to declare modifications might save you a bit on your premium, but it could end up costing far more if your claim is rejected down the line. Insurers need to know about modifications to ensure your policy accurately reflects your vehicle’s value and associated risks.
Some modifications might even prompt your insurer to decline covering your vehicle altogether, particularly those related to performance. For instance, adding a supercharger, turbocharger, or nitrous oxide boost may push your car beyond what many standard insurance policies are willing to cover. Additionally, certain modifications, such as illegal exhaust systems or overly tinted windows, could invalidate your insurance entirely if they breach legal regulations.
Common Modifications to Watch Out For
According to data from the insurance industry, the most frequent car modifications include:
- Alloy wheels
- Suspension changes
- Exhaust system upgrades
- Air filters
- Engine tuning or management systems
- Tinted windows
- After-market exhaust systems
- Tow bars
- Upgraded brakes
- Decals or stickers
If you’ve added any of these to your vehicle, make sure to notify your insurer. It’s better to be upfront about any modifications, even if you think they’re minor, to avoid problems later.
Specialised Modified Car Insurance
If you’ve made significant changes to your car, you may need a specialised insurance policy tailored for modified vehicles. These policies are designed to cover both the standard components of your car and any modifications you’ve added, ensuring you’re fully covered if you need to make a claim.
Bear in mind that some insurers might offer agreed value policies for modified cars. These policies allow you to agree on the car’s value with your insurer based on its enhancements, so in the event of a total loss, you’ll receive the agreed amount rather than the standard market value.
How to Keep Insurance Costs Down
Although modified car insurance might come at a premium, there are still ways to manage costs. Specialist insurers can often offer more competitive rates than mainstream providers, so it’s worth doing some research or consulting an independent broker. Additionally, joining a car club could give you access to discounted policies specifically designed for modified vehicles.
Another useful tip is to declare limited mileage if you only drive your car occasionally, which could lower your premium. Including less risky named drivers or bundling multiple vehicles under one policy can also help reduce costs.
The Bottom Line
Modifying your car can be a rewarding way to personalise your vehicle, but it’s essential to ensure that your insurance reflects these changes. Neglecting to declare modifications could lead to invalidated cover and rejected claims. Always check the terms of your insurance policy carefully, and if you’ve made any alterations to your vehicle, be sure to update your insurer.
At Segensworth Automobiles Ltd, we understand that your car is more than just a mode of transport—it’s a reflection of your personality. Whether you’re upgrading your car or simply looking for reliable servicing and MOTs, our experienced team is here to help. Contact us today or visit our website to see how we can keep your vehicle running smoothly and safely on the road!
Call us today on 01489 662 000 or email sales@segensworth-automobiles.co.uk to book an appointment.