Car Insurance for Modified Cars (2024)
Modified-car insurance covers vehicle parts and equipment not installed by the original manufacturer.
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Written byAlani Asis
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3 years of content writing
Bylines with leading financial publications
Alani is a freelance writer specializing in personal finance. She aims to make complex topics more approachable through fun, digestible content.
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Edited bySarah Archambault
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Experienced personal finance writer
Background working with banks and insurance companies
Sarah enjoys helping people find smarter ways to spend their money. She covers auto financing, banking, credit cards, credit health, insurance, and personal loans.
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Updated November 21, 2024
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Table of contents
Car modifications serve many purposes: enhanced performance, aesthetics, convenience, safety — you name it. Unfortunately, standard car insurance policies don’t always cover aftermarket parts or classic cars. So you’ll likely need modified-car insurance, which could cost more.
If you have a modified car, be sure to inform your insurance agent to update your current policy.[1] If your current insurer doesn’t offer modified-car insurance, you can compare car insurance quotes to find a policy that meets your needs.
Quick Facts
Custom parts and equipment coverage offers financial protection for many types of car modifications.
Some types of modifications can lead to an insurance discount.
The best insurance companies for modified cars are Progressive, Elephant, and Hagerty.
What to consider before modifying your car
Modified-car insurance is important because it protects your alterations from accidents, theft, weather damage, and more. If you fail to notify your insurance company to update your coverage to account for those modifications, you may have to pay for repairs or replacements out of pocket.
Before you modify a car or add any aftermarket customizations, it’s a good idea to assess the long-term effects of those changes. Consider how modifications may affect your insurance rates since you have to make premium payments to keep the car insured.
Will vehicle modifications raise your car insurance rates?
Generally, vehicle modifications raise car insurance rates, but this isn’t always the case. Modifications lead to higher premiums because repairing or replacing modified parts is typically more expensive. As a result, you end up paying more.
Before you make any modifications to your car, it’s a good idea to ask your insurance company how those changes could increase your auto insurance rates.
Are you buying a car that’s already modified?
Just because you didn’t make modifications to a car doesn’t mean you can ignore them. When you buy a used car, it’s best to have a mechanic inspect the car before you complete the purchase. Make sure you’re aware of any modifications so you can get an accurate quote for car insurance. The car’s value will influence how much you spend on auto insurance.
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Different types of car modifications
The more your modifications increase the value of your car, the more likely your car insurance rates will go up. Some auto insurance companies also consider whether you installed the new parts yourself or had them professionally installed.
Modifying a car involves swapping out the factory parts or adding aftermarket parts. Examples of common car modifications include:
Custom paint
Fender, hood, and body upgrades
Trailer and towing parts
Truck bed liners and bed accessories
Seats and upholstery
Dash systems and gauges
Headlights and taillights
Exterior accessory lighting
Interior lighting
Sound system and audio accessories
Alarms and security products
Mobile TV and video cameras
Car insurance coverage for modified cars
When shopping for insurance, it’s important to compare both standard coverage options and modified coverage add-ons to find a policy that fits your unique needs and budget.[2]
Here’s a closer look at some of the types of coverage for modified cars:
Liability coverage
Required in every state except New Hampshire, liability insurance pays for the injured party’s property damages and medical bills if you’re at fault in the event of an accident.
Comprehensive coverage
Comprehensive insurance covers repairs and replacements for your vehicle if it’s damaged due to a non-collision event, like severe weather, theft, or vandalism. Your lender may require you to carry this coverage if you finance your vehicle.
Collision coverage
Collision insurance provides coverage to your vehicle if you hit another car or object, like a fence or mailbox, regardless of fault.
Uninsured/underinsured motorist coverage
While not required by every state, having uninsured/underinsured motorist coverage can help pay for you and your passenger’s medical expenses and vehicle damages if an uninsured or underinsured driver is at fault in a car accident.
Personal injury protection coverage
Also known as PIP, this coverage helps pay for medical bills, lost wages, funeral expenses, and other costs associated with an accident, regardless of fault. This type of policy is required in no-fault states.[3]
Custom parts and equipment coverage
This type of modified-car insurance is an optional coverage that covers the cost of replacing and repairing aftermarket parts, like headlights and sound systems.
Classic car insurance
Specifically made for classic cars, this optional insurance provides liability, collision, and comprehensive coverage for classic cars 10–25 years old.[1]
Companies with additional coverage for modified cars
Not all insurance companies offer coverage options to help protect enhancements and modifications on your vehicle. And some types of add-on coverages could affect your rate. Check your current policy for coverage options.
You can also research companies that offer modified-car insurance to find the best fit, including the following:
Progressive: Progressive offers custom parts and equipment coverage with a coverage limit of $5,000. It pays for repairs and replacements to the modified parts of your vehicle.
Elephant: Elephant auto insurance provides custom parts and equipment coverage of up to $20,000 for custom parts. You must purchase a full-coverage policy to add this coverage.
Farmers: Farmers Insurance advertises aftermarket parts coverage, which you can add to your full-coverage policy. But the company doesn’t specify coverage limits on its website.
Hagerty: Hagerty is an insurance company that specializes in coverage for collector, classic, and modified cars. Coverage for modified cars is equal to a value that you and your insurer agree upon.
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Best modified-car insurance companies
Before you choose a modified-car insurance policy, it’s important to shop around to find the best possible coverage for your needs. If you need modified-car insurance, take a look at some of the best insurance companies for modified cars.
Progressive: Best for coverage options and discount opportunities
| JD Power J.D. Power data measures overall customer satisfaction and claims satisfaction based on a 1,000-point scale. | 819 |
|---|---|
| IQ Score The Insurify Quality (IQ) Score uses more than 15 criteria to objectively rate insurance companies on a one-to-ten scale. The Insurify editorial team researches insurer data to determine the final scores. | 8.4 /10 |
| Liability Only Liability-only insurance, sometimes called minimum-coverage insurance, pays for bodily injury and property damage to others in an accident the policyholder causes. It does not pay for the insured’s own damages. | $98/mo |
| Full Coverage Full-coverage car insurance generally includes liability, collision, and comprehensive coverage, and may include other optional coverages such as uninsured motorist coverage. Collision covers a policyholder’s repair or replacement costs in case of an accident. Comprehensive covers damages caused by non-accident events. The average quote displayed here reflects policies with the following coverage limits: $50,000 bodily injury liability per person; $100,000 bodily injury liability per accident; $50,00 property damage liability per accident; $1,000 collision deductible; and a $1,000 comprehensive deductible. | $152/mo |
How drivers feel about Progressive
Drivers appreciate the professional service and accident forgiveness but dislike the high prices and frequent rate increases.
AI-generated from the text of verified reviews collected by Insurify
Best For
Competitive rates
Easy buying process
Telematics program
How drivers feel about Progressive
Drivers appreciate the professional service and accident forgiveness but dislike the high prices and frequent rate increases.
AI-generated from the text of verified reviews collected by Insurify
Best For
Competitive rates
Easy buying process
Telematics program
Reviews (5,796)
Elandra
November 20, 2024
Verified Review
I don't even drive 30 miles a month, yet I pay over $200 a month. I have a clean driving record. This company is not good.
I don't even drive 30 miles a month, yet I pay over $200 a month. I have a clean driving record. This company is not good.
Denise
November 20, 2024
Verified Review
Fraudulent Claims Filed
They permitted false claims to be filed, complete with fabricated police report numbers, and treated the client as if the claim was not fraudulently filed.
Steven
November 19, 2024
Verified Review
I'll Stay with Them, No One Can Beat Them!
They are the cheapest I have found!
JD Power
J.D. Power data measures overall customer satisfaction and claims satisfaction based on a 1,000-point scale.
819NAIC Index
Average amount of customer complaints relative to competitors on a 0-5 scale. A lower score represents fewer complaints.
0.82A.M. Best
A.M. Best analyzes an insurer’s financials, operating performance, business profile, and other factors to generate an opinion-based rating of a company’s financial and credit strength. Ratings range from A++ (exceptional) to D (poor).
A+Why we picked this company
Progressive offers a coverage limit of $5,000 for custom parts and equipment. It also has a menu of coverage options to increase protection for your customized car, including accident forgiveness, gap, and rideshare coverage.
Pros
AM Best financial strength rating of A+ (Superior)
Rewards program for safe drivers
Cons
No available anti-theft device discount
More customer complaints than average, according to the National Association of Insurance Commissioners (NAIC)
Elephant: Best for high-value custom parts
| User Reviews | 3.6 |
|---|---|
| IQ Score The Insurify Quality (IQ) Score uses more than 15 criteria to objectively rate insurance companies on a one-to-ten scale. The Insurify editorial team researches insurer data to determine the final scores. | 8.3 /10 |
| Liability Only Liability-only insurance, sometimes called minimum-coverage insurance, pays for bodily injury and property damage to others in an accident the policyholder causes. It does not pay for the insured’s own damages. | $124/mo |
| Full Coverage Full-coverage car insurance generally includes liability, collision, and comprehensive coverage, and may include other optional coverages such as uninsured motorist coverage. Collision covers a policyholder’s repair or replacement costs in case of an accident. Comprehensive covers damages caused by non-accident events. The average quote displayed here reflects policies with the following coverage limits: $50,000 bodily injury liability per person; $100,000 bodily injury liability per accident; $50,00 property damage liability per accident; $1,000 collision deductible; and a $1,000 comprehensive deductible. | $200/mo |
3.6
A solid optionBased on 108 verified guest reviews and ratings
How drivers feel about Elephant
Drivers appreciate the good service, low initial rates, and responsive claims handling but dislike the frequent and unexplained rate increases.
AI-generated from the text of verified reviews collected by Insurify
Best For
Optional coverages
Good drivers
Numerous discounts
How drivers feel about Elephant
Drivers appreciate the good service, low initial rates, and responsive claims handling but dislike the frequent and unexplained rate increases.
AI-generated from the text of verified reviews collected by Insurify
Best For
Optional coverages
Good drivers
Numerous discounts
Reviews (58)
Donald
October 21, 2024
Verified Review
Good company, but got more expensive over time
They have a great website and provide quick answers. Their customer service is good. However, there isn't much flexibility in coverage. Over time, it became too expensive, especially considering I had no claims.
Denise
October 5, 2024
Verified Purchase
The customer service representatives were professional.
Elephant Insurance is an affordable company.
Ajay
October 1, 2024
Verified Review
Good Insurance Company
Great.
JD Power
J.D. Power data measures overall customer satisfaction and claims satisfaction based on a 1,000-point scale.
NRNAIC Index
Average amount of customer complaints relative to competitors on a 0-5 scale. A lower score represents fewer complaints.
0.77A.M. Best
A.M. Best analyzes an insurer’s financials, operating performance, business profile, and other factors to generate an opinion-based rating of a company’s financial and credit strength. Ratings range from A++ (exceptional) to D (poor).
NRWhy we picked this company
Elephant auto insurance provides modified car owners with up to $20,000 in custom parts and equipment coverage. This could be a good option if you’ve installed numerous or expensive parts. Elephant also offers add-ons like at-home mechanic services and accident forgiveness coverage to further upgrade your car insurance policy.
Pros
Many available discounts and coverage options
Legal assistance coverage available
Cons
Available in only eight states
High NAIC complaint ratings
Hagerty: Best for classic and collectible cars
To cover your classic or collectible modified vehicle, Hagerty builds an agreed-value policy based on the amount you and the appraiser agree that the car is worth. The agreed value is the basis of your coverage amount. The company also offers unique coverages, including up to $750 in spare-parts coverage and $10,000 in auto-show medical reimbursement.
Pros
Nationwide coverage
Potentially lower premiums than standard car insurance
Cons
Doesn’t offer insurance for regular-use vehicles
Storage and driver requirements apply
Modified-car insurance FAQs
To help you better understand how modified-car insurance works, here are answers to some frequently asked questions about this type of insurance.
What is considered a modified car?
A modified car is a vehicle you’ve altered with aftermarket parts or parts not sourced from the original manufacturer. Modifications can improve your vehicle’s performance, safety, and appearance. But it’ll likely increase your insurance costs.
Do modified cars have more expensive insurance?
It depends. Generally, having a modified car leads to higher repair costs, which may lead to higher rates. But some modifications actually decrease your insurance rates if they help improve your car’s safety.
Do you need to tell your insurance company about custom modifications?
Yes. You need to inform your car insurance company about any custom modifications you make to your car, as your standard policy won’t cover those changes.
If you file an insurance claim without modified-car insurance, you may have to pay out of pocket to repair or replace custom parts. Being up front with your insurer helps you not only get the supplemental coverage you need but can also protect your original policy.
Which car modifications can lead to insurance discounts?
Many insurance companies offer discounts for car modifications that enhance your vehicle’s safety. For example, you may see savings for anti-theft systems, additional airbags, and advanced braking systems.
That said, the availability and specifics of vehicle safety discounts often vary by insurer.
Does modifying a car void insurance?
Not necessarily. But if you fail to disclose car modifications, your insurance company may not cover them if you get into an accident or your car is damaged or stolen. Without modified-car insurance coverage, you’ll likely have to pay out of pocket to repair or replace aftermarket parts.
Sources
- Insurance Information Institute. "Insuring your classic car."
- Insurance Information Institute. "How to find the right auto insurance."
- Insurance Information Institute. "What is covered by a basic auto insurance policy?."
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Alani Asis
Alani Asis is a personal finance freelance writer with nearly three years of experience in content creation. She has landed bylines with leading publications and brands like Insider, Fortune, LendingTree, and more. Alani aims to make personal finance approachable through fun, relatable, and digestible content.
Edited bySarah Archambault
Experienced personal finance writer
Background working with banks and insurance companies
Sarah enjoys helping people find smarter ways to spend their money. She covers auto financing, banking, credit cards, credit health, insurance, and personal loans.
Featured in