Modified cars and insurance premiums

[glojo]

I have just read a post that has made me think.

If you modified your AMG powered flying machine with the below listed modifications, are you duty bound\legally bound to notify your motor vehicle insurance company?

How much will it raise,, if any the annual premium?

If you were involved in a terrible accident and as a direct result you were severely disabled, do we seriously expect the insurance company to compensate us if we fail to declare the vehicle has been modified and yes I hopefully expect them to pay out for any third party? I am NOT being critical of anyone, I lay on my bed all day with nothing better to do than read forums as doing this might keep the old grey matter ticking over

QUAIFE LIMITED SLIP DIFFERENTIAL
BMC AIR FILTERS
EUROCHARGED CUSTOM DYNO ECU REMAP
EUROCHARGED 83mm SMALLER CLUTCHED SUPERCHARGER PULLEY
I STAGE COOLER SPARK PLUGS
EUROCHARGED ENLARGED CAPACITY HEAT EXCHANGER
S55 AIR INTAKE TUBE
ASP PULLEYS
EUROCHARGED TRANSMISSION TCU REMAP
MERCEDES C63 REAR EXHAUST BOXES
PLM SHORT HEADERS - STAINLESS STEEL (MANIFOLDS)
PORTED CYLINDER HEADS

 

[Deleted member 149005]

Anything that is a non a standard OEM fit must be declared

That includes accessories such as parking sensors...

 

[Bobby Dazzler]

I have just read a post that has made me think.

If you modified your AMG powered flying machine with the below listed modifications, are you duty bound\legally bound to notify your motor vehicle insurance company?

How much will it raise,, if any the annual premium?

If you were involved in a terrible accident and as a direct result you were severely disabled, do we seriously expect the insurance company to compensate us if we fail to declare the vehicle has been modified and yes I hopefully expect them to pay out for any third party? I am NOT being critical of anyone, I lay on my bed all day with nothing better to do than read forums as doing this might keep the old grey matter ticking over

QUAIFE LIMITED SLIP DIFFERENTIAL
BMC AIR FILTERS
EUROCHARGED CUSTOM DYNO ECU REMAP
EUROCHARGED 83mm SMALLER CLUTCHED SUPERCHARGER PULLEY
I STAGE COOLER SPARK PLUGS
EUROCHARGED ENLARGED CAPACITY HEAT EXCHANGER
S55 AIR INTAKE TUBE
ASP PULLEYS
EUROCHARGED TRANSMISSION TCU REMAP
MERCEDES C63 REAR EXHAUST BOXES
PLM SHORT HEADERS - STAINLESS STEEL (MANIFOLDS)
PORTED CYLINDER HEADS

John I think you're comments are spot on, I suspect that in the event of a claim then affected third-parties would be covered but the insurance company may not pay out to the policyholder. Therefore policyholders are obliged to "tell the truth" and have to confirm that's the case when taking out a policy.

Like many things in life - and in the legal system - much has to do with reasonableness. If a modification has been performed by a previous keeper, and the policyholder was unaware - and could not reasonably expected to know it had been modified - then I suspect that the insurer would probably pay out in full.

Knowingly withholding information or misleading the insurance company regarding the risk is the real issue.

 

[Petrol Pete]

Insurance companies are in the grip of their shareholders and have a duty to them not to pay out any claim that they can get away with. Any reason for not paying out in full will be pounced upon, whether a undeclared 400bhp re map or upgraded brake hoses...

 

[Deleted member 149005]

To provide an example, several years i had a motorcycle and i was involved in a accident

The insurer wanted to repair with pattern parts - exhaust, pegs, bodywork etc

I asked if those would count as modifications, seeing as they weren't OEM fitment.

The answer was .. yes

I insisted on OEM parts at an extra cost of £2k

 

[markjay]

John I think you're comments are spot on, I suspect that in the event of a claim then affected third-parties would be covered but the insurance company may not pay out to the policyholder. Therefore policyholders are obliged to "tell the truth" and have to confirm that's the case when taking out a policy.

Like many things in life - and in the legal system - much has to do with reasonableness. If a modification has been performed by a previous keeper, and the policyholder was unaware - and could not reasonably expected to know it had been modified - then I suspect that the insurer would probably pay out in full.

Knowingly withholding information or misleading the insurance company regarding the risk is the real issue.

If the policy becomes invalidated due to undeclared mods, then in the event of an at-fault accident involving a third party, the policy holder becomes liable for 100% of the damages in respect of all parties involved.

This means that the insurer won't pay the policy holder anything for damages they suffered.

The insurer will pay the third party for damages, and the insurer will then chase the policy holder for the monies they have paid-out.

In the majority of cases where large sums are involved (e.g. a worst-case scenario where the injured third party is a young professional who will require aroubd-the-clock care and is unable to work for life, or where the damage to property is significant, etc) the insurer won't actually see a penny, because most people simply can't pay back this kind of money, and the policy holder will then either reach some sort of personal IVA with the insurer of just declare bankruptcy.

Now, this is obviously a very extreme scenario, and the chances of it happening to you are statistically very low, but if you are the type of person that likes to sleep well at night and not have to worry about undeclared mods that have the potential of unleashing a whole world of pain on you... then declare them and pay the additional premium (if applied).

So for most people, declaring the mods now is better than declaring bankruptcy later...

And, you can call your insurer, explain what the mods you intend to have carried-out entail, and ask your insurer for a quote in advance. My own experience, BTW, is that mods that don't increase bhp generally tend to have no effect on the premium, but this may vary between insurers.

 

[ToeKnee]

As an example, the quoted increase in premium for a remap on the M278 engine in my SL500 was £49 for the year. Why wouldn't you inform them and pay it seeing how it's so little money?

 

[glojo]

I apologise if I have caused a slight furore but as these knowledgeable folks are explaining, when modifying ANY car please, please think about the consequences. If you have a minor accident, then the chances are slim that your car will be examined, but.... When we fit 'go faster' mods or mods that increase horse-power, are we going to use the potential of the financial outlay we have put into increasing the performance of our car?

The public highway is never the place to put 'the pedal to the metal' or the 'heel to the steel'

Before carrying out modifications then please think about contacting your insurer and simply asking about any additional costs and just remember, if you are involved in a serious road traffic incident and the finger is being pointed at you, then there is a good chance your vehicle might undergo an extensive investigation!

 

[Doodle]

What the insurers and underwriters invariably won't tell you is that their policies are a contract of utmost good faith. This is largely irrelevant at the time when you are the one making the changes, but becomes far more important further down the line.

The shopping list mentioned above is going to be pretty damn obvious. But taking the other example mentioned above - braided brake hoses. To a lay person, they're not going to know when they buy the car however many years down the track, because unless they're in a lurid colour they aren't obvious. A set of black braided hoses buried behind a brake disc looks pretty much like a set of normal hoses, especially after they've been on the car a while. They're not a petrolhead, they don't do their own maintenance.

It is deemed unreasonable for an insurer to invalidate under those circumstances, although god knows they'll try it on in the hope you don't know that. It would be equally unreasonable for them to expect the owner to submit their car for detailed inspection every time a new policy was required.

Bottom line, follow rule 7. If you did it, or you know about it, declare it.

 

[X1XXM]

When I was buying the G, the difference with nearly £100k of mods on it declared, as opposed to a standard G63, was £700 with Admiral

 

[Larkone]

Useful blog from a modified car insurance company

How popular modifications affect your car insurance | Adrian Flux

Find out which mods increase your premiums, which decrease them, which don't affect your insurance, and what to declare to your insurer.

www.adrianflux.co.uk

 

[whitenemesis]

Useful blog from a modified car insurance company

How popular modifications affect your car insurance | Adrian Flux

Find out which mods increase your premiums, which decrease them, which don't affect your insurance, and what to declare to your insurer.

www.adrianflux.co.uk

An interesting read and almost the polar opposite of my experience with declaring mods to my insurer (was Direct Line at the time)
Suspension modification, fitting coil-overs resulted in a 30% increase in premiums.
Braided brake lines, DL point blank refused to cover me if I went ahead with the modification.
Retro-fitted bi-xenons, COMAND, telephony, auto-wipers, full nappa retrim, custom steering wheel and wood interior trim, 19" alloys, winter tyres all resulted in no change but agreed replacement costs (these were all prior to the coil-overs)

Obviously each insurer has their own interpretation and rules. Bottom line is to check before doing the mod.

 

[markjay]

What the insurers and underwriters invariably won't tell you is that their policies are a contract of utmost good faith. This is largely irrelevant at the time when you are the one making the changes, but becomes far more important further down the line.

The shopping list mentioned above is going to be pretty damn obvious. But taking the other example mentioned above - braided brake hoses. To a lay person, they're not going to know when they buy the car however many years down the track, because unless they're in a lurid colour they aren't obvious. A set of black braided hoses buried behind a brake disc looks pretty much like a set of normal hoses, especially after they've been on the car a while. They're not a petrolhead, they don't do their own maintenance.

It is deemed unreasonable for an insurer to invalidate under those circumstances, although god knows they'll try it on in the hope you don't know that. It would be equally unreasonable for them to expect the owner to submit their car for detailed inspection every time a new policy was required.

Bottom line, follow rule 7. If you did it, or you know about it, declare it.

The other issue is that undeclared mods will only come to light in the event of a claim (insurers do not inspect cars if no claim is submitted), and if you claim ignorance and say that you didn't know the mods were fitted (suggesting that they were fitted by a previous owner), then in the event that the insurer is somehow successful in proving that the mods were indeed fitted while the car was under your ownership, then not only will your insurance be invalidated, but you also run the risk of facing criminal charges for insurance fraud.

In essence, not declaring mods is a bit like jumping red lights - if you didn't crash, there was no camera, and no copper saw you, then you're fine... but if you keep doing this, then it's only a question of time before you run into trouble.

 

[Larkone]

Not just insurance fraud, the insurance company will return all of your premiums as it was invalid insurance and therefore you have the issue of not being insured since the insurance was taken out which could be some years and that would attract serious charges/fines and eyewatering re-insurance costs. That's the one most people do not realise, how much it will cost to you insure as a high risk driver

 

[AMV]

Too risky not to insure modifications and get caught out should the worst case happen!

Definitely insure all changes and forget mainstream insurers.

 

[Wearsthefoxhat]

Just not worth the risk imho. Why buy a nice car, spend good money on it to improve it and risk not just loosing the car but everything you have worked for, if the worst should happen.

 

[poormansporsche]

Hmmmm , wrapped the bump strips on the van in blingy purple, got some "wing protectors" also to be wrapped then fitted. How to explain that to the insurance company

 

[PhantomF4]

I once modified a low powered Mk1 MX-5 with Koni adjustable suspension, added a supercharger and full length matching exhaust system. I changed the wheels to lightweight alloys and swapped the original seats for Recaros. The car was set up on a rolling road and the mods showed a gain of almost 45%, cue big grins as the original differential and gear ratios were retained meaning blistering acceleration with little increase in top speed.

Armed with the information I contacted Adrian Flux for a quote and was amazed to find that it would cost only 20% more than a quote for an unmodified car. They sent me a tick box form to complete so I could list all the details and the insurance was set up without delay.

I should add that I took out a fully comprehensive, NCB protected policy, not a simple TPF&T. One of the benefits of being one the mature side of 50 maybe?

Motto - if in any doubt, tell them!