Tue, 2017-12-12 11:00

Vehicle Modifications Can Affect Insurance Premiums

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Vehicle Modifications Can Affect Insurance Premiums

Every day we see them on our streets – customized vehicles with non-stock spoilers, enhanced engines, raised suspensions and the like. Needless to say, the post-manufacturer auto modification business is booming.

But while adding performance parts and ‘styling’ features to your vehicle can give it a distinct appearance and improve performance, they may also impact your auto insurance. So before you add a turbo-charged engine or even tint your windows, it is a good idea to contact your insurance broker or insurer to make certain you have the right coverage.

Glenn Cooper from Aviva Canada points out that vehicle modifications can increase risk and your premiums as a result. He explains, “certain modifications can put motorists at a greater risk of having a collision, such as a lowered or raised suspension, or increasing the size of your engine. Your vehicle could become untrustworthy on the road and impact your safety as well as your access to coverage.”

Even modifications you would expect to better the insurance risk of your vehicle, like an improved brake system, may still increase the cost of insurance for the following reasons:

  • The modifications might increase the value of the vehicle, therefore increasing claims costs
  • Modified vehicles often are more attractive to thieves increasing the risk of theft
  • Vehicles with performance modifications generally mean that the performance of the vehicle is improved which can lead to more severe accidents

A book titled Vehicle Modifications and the Law - Ontario Police Edition by Mathew John, a former Municipal Law Enforcement Officer with Toronto Police Services and the creator of the national anti-street racing program PACER (Police and Community Educating Racers), is available at both Chapters.ca and Amazon.com.     

Of if you’re feeling extra adventurous, you could scan all 200 plus page of the Ontario  Highway Traffic Act.

Remember an insurer could refuse to pay a claim and even leave you uninsured if you have not disclosed modifications to your vehicle. So before you invest time and money on a project that could raise your premium, call your broker or insurance company and verify that your insurance will remain valid.