There are many car enthusiasts out there who love to customize their vehicles beyond what the manufacturer allows. From new rims and tires to a wicked new paint job, many times customization can go beyond just the visual aesthetic and into new engines, transmissions and brand new sound systems. However, what many may not realize is that this can actually raise your car insurance rates by a significant amount. We decided it was time to reveal the truth about car customization and auto insurance to not only have you rethink that orange stripe down the passenger side but also save you unnecessary expenses in the future.
First, the general rule of thumb to consider is that modifications that enhance the overall performance of your car will make your insurance premiums rise. If we look at the facts, the demographic who customizes their cars the most are young men. Now pair that with a new car that’s value has just increased due to significant enhancements. It’s no wonder your car insurance rates would rise and believe us, they will. Now, many may think “how will my insurance carrier know?” and believe you can just not report it. This is the worst thing you can do because if you’re in an accident and a claim is filed your car could be inspected. If the modifications are discovered you could be in a serious pile of dog poo. We always recommend reporting any modifications to your vehicle to ensure everything is documented and on file.
The same can go with aesthetic modifications. While these do not enhance the performance or value of the vehicle for the most part, they do make a vehicle more attention-grabbing which can in turn make the risk for theft raise. This in turn would raise your car insurance premiums due to the fact that the liability of a claim would spike and could increase the risk of your car being stolen. Thus, most insurance providers will raise your rates simply on this fact alone.
The most important thing to understand is that insurance providers are looking to make money and they also do not want to lose money. If you modify your car and make it worth more, they are going to want to cover their liability as well as protect yours. In turn, this will raise your rates. We recommend before doing any modifications to your vehicle your call your insurance provider and explain what you want to do first. That way you can find out how much (if at all) it will raise your insurance premiums. You may be surprised at how much it actually costs per month due to the fact most insurance providers will spread it out over the 6 or 12 month policy period. Overall, the main point to take away from this is ask first, modify later.