Car modifications usually make insurance more expensive because they increase the value of a vehicle.
Some changes, however, could make a car policy cheaper if they make a car more secure - here’s everything you need to know.
Most changes that make your vehicle look and drive differently from how it was originally manufactured are classed as car modifications.
This includes alterations or upgrades offered by dealers when you buy a new car.
Car modifications are split into two main categories:
These change the appearance of a car, for example, changing car colour with a custom paint job or tinting the windows.
Changes that make a car drive differently for example, installing a bigger engine.
Insurance tends to be more expensive if you have a modified car because statistically drivers that alter their vehicles make more claims.
The modifications don’t necessarily need to be dangerous to impact your policy price.
Most modifications affect the value of your car and custom parts are usually more expensive to repair or replace, which insurers use to decide how much you should pay for car cover.
Every car in the UK is put into one of 50 insurance groups that insurers use, along with a few other things, to calculate how much you pay for a policy.
As a general rule, the higher your insurance group, the more it adds to the cost of your car insurance.
Cosmetic changes like a custom paint job could make it more likely to get stolen.
Overall, performance modifications tend to increase the cost of car insurance more because they increase your risk of getting into an accident.
While cosmetic changes can also make your insurance more expensive, statistically they only increase the risk of your car being targeted by criminals.
You should tell your insurer about any car modifications before applying for a policy, as some companies won’t insure them.
Your policy could be invalidated if you don’t declare the modifications which means your insurer won’t pay out if you have to make a claim. 🚫
It’s really important that you speak to your insurer before modifying a car to make sure that the changes can be covered by your existing policy.
If they’re able to insure the modifications you want, your policy price could increase and there may be an admin fee to update your details too.
If they won't insure it, and you go ahead with the modifictions anywaay, your policy will probably be cancelled, which could make it harder and more expensive to find insurance in the future.
It’s important to check the following features before buying a modified car:
It’s important to check that the modified parts are from trusted industry brands to guarantee their quality. Take the car for a test drive to make sure the parts work properly. It's also worth asking the seller for evidence to certify that the modifications were fitted by a reputable company or service.
Some car modifications are illegal as they make cars more dangerous on the road, for example, bright under-car neon lighting. Insurers won’t cover illegal modifications and you might get a fine (or even go to court) if you’re driving with them.
The Driver and Vehicle Licensing Agency (DVLA) needs accurate records of your car’s details for tax and road safety purposes.
Insurance companies and the police use DVLA records to get information about your car, including the colour, model and engine size.
You can look at that data for free using our car checker tool.
You’ll also need to contact the DVLA to update your vehicle details if you make certain modifications to your car.
This includes changing the:
To make any changes, you’ll need to update something called a V5C (also known as a “log book”), which is the paperwork you get from the DVLA to prove that you’re the registered keeper of a car.
You’ll need to complete section 7 of the V5C and send it off to DVLA, Swansea, SA99 1BA.
A new V5C should be sent to you within two to four weeks.
Common types of car modification could make your policy expensive such as:
Opting for bigger wheels and new shiny alloy can change the way a car drives and make it more likely to get stolen.
Exhaust upgrades give cars a boost in speed, making them less safe on roads and more expensive to insure.
Custom paint jobs, vinyl wraps or resprays to change your car colour and bumper stickers could make your car more valuable and increase the chance of it being targeted by thieves.
Adding features like a sunroof, a tow bar or a roof rack are also classed as modifications that could increase your car policy price.
Body kits, which include things like bigger bumpers and side skirts, aren’t usually designed with safety in mind and are more likely to get damaged in an accident.
Upgrading your sound system and installing in-car entertainment increases the value of your car, making it more likely to get stolen or damaged. They’re also more expensive to repair if anything gets damaged.
Some insurers consider personalised number plates to be car modifications, and they could increase the price of your premium.
Some car modifications could make your policy cheaper if they improve the security of your vehicle.
This includes installing things like:
Most insurance companies approve of devices endorsed by Thatcham, an independent organisation that rates car security.
You can ask your insurer about the discounts available for adding certain security features to your car.
Certain car modifications are illegal because they make vehicles unsafe to be on the road.
Illegal car modifications could land you with a penalty and in some cases court action. 😬
Most insurers signed an agreement to take winter tyres off the car modifications list, so using them shouldn’t affect your policy price.
A handful of insurers - eCar, Southern Rock Insurance and Swiftcover - still need you to tell them if you use winter tyres even though it won’t increase your premium.
Performance and cosmetic car modifications usually drive up the cost of a car policy, which can make it very expensive for younger drivers to get insurance.
Drivers under 25 already pay the most for car insurance because they tend to have more accidents and make more claims.
So if you’re a younger driver or already have an expensive car premium, avoiding performance or cosmetic car modifications can help you pay less for a policy.
Instead consider car modifications that boost its safety and security because they’ll reduce your risk of needing to claim and could make your policy cheaper.
These include installing:
Some insurance companies offer tailored policies if you have a physical disability to help you with disabilities which includes cover for vehicles adapted to help them drive.
The cost of insurance for cars with performance or cosmetic modifications is usually more expensive.
Keeping your annual mileage low can help make your policy cheaper though.
Where possible, paying annually for car cover can cut the cost of a policy and avoid them adding interest to your payment.
Some insurance companies offer insurance designed for modified cars. These might be a cheaper than a standard policy.
Updated on 23rd December 2020