Insuring a modded car - disclosure?

Pardon the potentially daft question, but I have yet to insure a modded car here in the US, so I'm somewhat unfamiliar with disclosing said mods to the insurance.

I'm assuming you have to declare them so you don't end up suddenly finding yourself without cover, especially if we're talking modifications that would add power or desirability to light fingered folk, correct?

Let's assume I'm looking at a turbo car that somehow acquired a FMIC, aftermarket turbo, a free-er flowing exhaust and some modifications to the fuel system, I assume I just tell them and when they ask me how much power it makes, I'll just say "I dunno", simply because I really don't? It hasn't been on a dyno as far as I know and I'm not going to provide someone with rope to hang me by providing a guess.

Just wondering because every country I've lived in so far has very different rules about this, so I tend to like to figure this out before I get shouty at the insurance agent.

Some insurers actually have special policies for modded cars and you can insure the car including the value of said mods.

I don't think i've ever had an insurance company ask me how much power i'm making, and for that matter, my current insurance company has no idea that my car is modded.

Let them know only if youd want those mods covered in case of a loss, but keep in mind certain companies with reptile mascots will assume that you only mod a car to street race.

We've moved away from the company with the reptile Mascot with the 'orrible accent to State Farm, if that makes any difference.

I'd also be paying a fairly small premium over KBB private party for the car, it's not like I'm paying double that figure for it so I'm not sure I'd need the mods covered.

I'm aware of Hagerty - in fact once I get my act together and get the bikes titled that I brought over from the UK, they'll be insured by Hagerty. In fact, my 911 in the UK used to be insured with them.

The problem is that from talking to them, they really don't want to insure daily drivers, which is what this car would be.

unlike the UK.. they can't deny your insurance because you debadged your car. Most insurance companies never even look at the mods. I have state farm and even though they have pics of my Ti on file (for full coverage) they have never asked about the M3 rims, the lowered stance, or any other of the noticible mods.. and certainly not about any of the unnoticible ones.

I had state farm when I totalled out my Hyundai Tiburon. The assessor looked at the photos and said.. "oh! You put rims on it" (mine came with steelies) and promptly increased the amount of money I would be getting from them for the value of the car

I've been with SF for 25 years, and my agent knows exactly what I'm doing with my cars, off the record, of course.

He says that in all his years in the business, he has only refused 1 claim based on modifications, and it was because the guy was trying to pull a scam.

My experience has been that the insurance company will only insure for the value of the stock car. I had one agent even say, "Stuff whatever you want to into it - just as long as you understand we don't cover it."

When I got rear-ended 10+ years ago, the other guy's insurance company did pay for the repairs and modifications I had done within the last six months on top of totaling the car, which got me almost twice what the KBB on the car at the time was.

I have always been told, if you modify a part already on the car, it's covered at actual value. If you add it, you can get additional insurance to cover the modification above and beyond the standard policy.

This coming from a guy who had a $500 headunit stolen out of my Ranger one Sunday afternoon. Allstate covered right up to the replacement value minus deductible.

Hmm, that all sounds more positive that I'm used to.

In the UK, the insurance agent - even with one of the "specialist" brokers - would have a hissy fit when you had a long list of mods that went beyond fart can exhausts and bodykits so ill fitting and ugly that they'll make Vileside kits look good.

"It's got an estimated 50% more power" didn't tend to go down that well...

Tim, I work in the business. The thoughts given here are right. For liability purposes (i.e. damage you cause to someone else), they're very likely not going to deny coverage because your car has modifications. They may decide to drop you after your policy expires if they feel your car was a "street racer", but they shouldn't deny a liability claim up front. Underwriters don't like heavily modified cars.

As for coverage for your car itself, yes, you want to disclose what you have. Receipts, when available, are always best. The standard collision/comprehensive coverage covers a stock vehicle. It depends on the language in your policy, but most mods are not covered without a special endorsement on the policy.

I had State Farm years ago. Really liked them until…..
I had a CJ-7 that was mildly built, think modern Rubicon. Funny, this was a few years before the Rubi came out and they are almost identical, right down to tire size and hear ratios. Anyway, I wanted full-coverage on the Jeep. I went to the agents office to get a pic taken and they said they won’t cover it because I have a winch on the front. When questioned they told me that the winch shows the vehicle is intended for off-road use. I said the 4 letters J-E-E-P shows that it’s intended for off-road use. They said they won’t cover it. I verified that if I were to roll my Jeep over and total it, as long as I was in a designated ORV area and had my ORV permit that they would cover my Jeep if it didn’t have a winch. They said yes. So, I explained that the winch is a safety and recovery device. Instead of backing down an obstacle and rolling over I can attach a cable to an anchor point at the top and safely pull myself up. Again, denied. So, I reminded them that currently I have 5 vehicles and a house insured through them, that I’ve had everything insured through them since I was a kid and that if they didn’t insure this jeep, as is I’d be cancelling every policy before I left the office.
I left with a handshake and an insured Jeep.

In reply to DrBoost:

That sounds like a boneheaded agent in my opinion.

Klayfish wrote: Tim, I work in the business. The thoughts given here are right. For liability purposes (i.e. damage you cause to someone else), they're very likely not going to deny coverage because your car has modifications. They may decide to drop you after your policy expires if they feel your car was a "street racer", but they shouldn't deny a liability claim up front. Underwriters don't like heavily modified cars.

I don't know where they draw the line that makes something 'heavily modified' but I have this vague notion that this one might qualify even if it's just because it's a 1g DSM that's not modified badly...

From an appearance point of view it looks stock with some aftermarket wheels, but that notion mostly disappears when you lift the hood.

Klayfish wrote: As for coverage for your car itself, yes, you want to disclose what you have. Receipts, when available, are always best. The standard collision/comprehensive coverage covers a stock vehicle. It depends on the language in your policy, but most mods are not covered without a special endorsement on the policy.

The car is sufficiently cheap that I'm not too bothered about covering the mods, mainly because there are only a few hundred bucks difference between what I'd be paying for the car and KBB. Neither would be enough to cover recreating the car anyway and I'm not sure I'd want to insure an old DSM for over $10k. OTOH if I bend it I might as well try to find another one and swap the parts over.

What I'm concerned about is basically two factors, one being the potential for denial of a claim or coverage, the other one being that they already warned me that the underwriters would take a very dim view of me mentioning that I would want to use the car on the track, after I specifically pointed out to them that I didn't expect coverage for on-track damage. Heck, that's why I'm trying to buy a cheap car in the first place.

In reply to DrBoost:

Well, it might be worth pointing out to them that the local Allstate agent is in walking distance...

BoxheadTim wrote: In reply to DrBoost: Well, it might be worth pointing out to them that the local Allstate agent is in walking distance...

We're no longer with them, but it's only because we moved. I was ticked about that bout of stupidity.
To the OP point, I don't know if it really matters if it's modd'd unless you want those items covered, then you might just need a rider. Either way, insurance is a scam and they are out to screw you at every turn.

I've been with SF since I started driving and have always had great service. When the tree fell on my Mustang (shudder) I drove it to the "approved repair center" which was the bodyshop I used anyway. The shop owner does the estimate, so having him include the few mod items (custom stripes, et.) that were damaged was easy. He files the electronic estimate with SF over their system and starts work on the car.

They've never asked me about the mod state of any of my vehicles. Of course, finding a good agent is as important as finding a good company.

My company (Zurich) asked me to get an appraisal and submit it (for the truck). This was probably around 2003. It was $100 – and I ended up with an appraisal of $18,000 (far less than I'd actually spent, but a lot more than the book value).

DrBoost wrote:

BoxheadTim wrote: In reply to DrBoost: Well, it might be worth pointing out to them that the local Allstate agent is in walking distance...

We're no longer with them, but it's only because we moved. I was ticked about that bout of stupidity. To the OP point, I don't know if it really matters if it's modd'd unless you want those items covered, then you might just need a rider. Either way, insurance is a scam and they are out to screw you at every turn.

Not really...

...Can I interest you in a quote? We have decent rates in your town...

Joey

DrBoost wrote: Either way, insurance is a scam and they are out to screw you at every turn.

So why exactly is it a "scam"? If you really think people who work for them consciously conspire to "screw you at every turn", I can tell you from years of first hand inside knowlege that's dead wrong. I'm one of those people, and know countless others. Not one tries to screw anyone out of anything that's owed. The huge disconnect comes between what people feel insurance should give them and what's actually in their written contract, or what they see on TV.

Tim, Underwriters often aren't "car guys" or "car gals". They're numbers people. To them, they see collecting $1000 or $2000 in premium vs. the risk of paying $100,000+ out on a claim. Not good odds if you were in Vegas. Hence why they shy away anytime they hear "racing" or "modifications" or things like that. It's not the on track stuff they're worried about, that's clearly excluded in the policy. It's the behavior they feel, right or wrongly, that a modified car may lead to. So they get very gun shy when they feel a car was modified for speed. It's the old story of the behavior of a few bad drivers causing issue for the rest. Often, these "modified" cars wind up in nasty wrecks that cost a fortune. I can give you tons of examples. I wouldn't even get into any on track stuff with them, it's not covered anyway, so it's not in their scope of interest.

You could try the "I'll take my business somewhere else" approach, but more often than not underwriters aren't swayed by that. Again, it's the thought process of losing a $2000 customer vs. the risk of having a huge claim. Not that they don't want to retain customers, of course they do, but it's statistics and numbers.

Joey, you are an insurance dude? Maybe we should talk???? Seriously, shoot me a PM.
As far as them trying to screw you, my apologies to anyone here on the board who is an insureace agent. But when my first jeep was rear-ended they wouldn't pay for the front bumper because it was rear ended. I explained that the impact pushed me into a tree (happened off-road). Since there was no report they wouldn't pay for that. It was in an ORV park so the cops don't come out if nobody is hurt. Then how about all these stories I hear about someone filing a claim, the first time in XX number of years. The insurance companies pays (after a battle) and drops them or jacks rates up??? Or how about the recent flood in my basement. They decide replacement value, I have no say. Then they give me partial payment, and the rest when I proove that I replaced it? How about you owe me the money, now give it to me. Can I send them 60% of my premuim and the other 40% when they prove that they used my money to pay somebodys claim? They are out to pay as little and as often as possible and IF you ever use them they jack rates up, make the money back then drop you.
In my book, that's a scam.

Klayfish wrote: Underwriters often aren't "car guys" or "car gals". They're numbers people. To them, they see collecting $1000 or $2000 in premium vs. the risk of paying $100,000+ out on a claim. Not good odds if you were in Vegas. Hence why they shy away anytime they hear "racing" or "modifications" or things like that. It's not the on track stuff they're worried about, that's clearly excluded in the policy. It's the behavior they feel, right or wrongly, that a modified car may lead to. So they get very gun shy when they feel a car was modified for speed. It's the old story of the behavior of a few bad drivers causing issue for the rest. Often, these "modified" cars wind up in nasty wrecks that cost a fortune. I can give you tons of examples. I wouldn't even get into any on track stuff with them, it's not covered anyway, so it's not in their scope of interest.

Yeah, the track stuff is not going to get mentioned. As you mentioned it's not really of interest to the assessment of the possibility of a claim. And I hear you re the possible cost of these claims; Trouble is that the old dudes with thinning hair like me are getting thrown in with the street racing crowd even if we know better.

Let's see what they see when I give them a call...

DrBoost wrote: As far as them trying to screw you, my apologies to anyone here on the board who is an insureace agent. But when my first jeep was rear-ended they wouldn't pay for the front bumper because it was rear ended. I explained that the impact pushed me into a tree (happened off-road). Since there was no report they wouldn't pay for that. It was in an ORV park so the cops don't come out if nobody is hurt.

An adjuster has no verifyable reference to evaluate that it happened the way you say it did without a report from an authority. Did the park have any private security or ranger? Did you take pictures to submit of the accident? (when it happened with you in the tree, not just of the damage?)

Its pretty much a given to meet resistance in those circumstances.

Or how about the recent flood in my basement. They decide replacement value, I have no say. Then they give me partial payment, and the rest when I proove that I replaced it? How about you owe me the money, now give it to me. Can I send them 60% of my premuim and the other 40% when they prove that they used my money to pay somebodys claim? They are out to pay as little and as often as possible and IF you ever use them they jack rates up, make the money back then drop you. In my book, that's a scam.

You don't have to accept the settlement proposed initially if you don't agree with how they determined replacement value. There are procedures in place with your state insurance board to go over such things.

And depreciation payment witheld is not something new either. It is most often held when claim is over a few thousand dollars and/or there is more than a 40% lein on the property, mortgage or otherwise. This is to force the issue of showing documented repairs to a structure, under "Coverage A", because its the property that is insured, not the person.

I've never heard of a recoverable depreciation witheld on damaged contents....

Klayfish wrote: So why exactly is it a "scam"? If you really think people who work for them consciously conspire to "screw you at every turn", I can tell you from years of first hand inside knowlege that's dead wrong. I'm one of those people, and know countless others. Not one tries to screw anyone out of anything that's owed. The huge disconnect comes between what people feel insurance should give them and what's actually in their written contract, or what they see on TV.

My definition of a scam is taking something of mine, using it for other purposes, and then when I need to use that item, I am told berkeley you.

Insurance is a scam. I pay WAY more then my fair share because of where I live, about double from where I did live, but when my wife's Monte Carlo caught on fire, for which there is a recall on, we were accused of deliberately driving to another state and intentionally setting it on fire. Mind you, I live 5 miles from the border with West Virginia and the car was parked at a hospital with security cameras all over the place. Then trying to get a real world value and not some crackwhore pricing on vehicle replacement value. That took 4 months and the agreed to price was still many dollars less then what it was worth. We only settled because we were told in so many words, "Settle or don't get a check."

Klayfish wrote: Tim, Underwriters often aren't "car guys" or "car gals". They're numbers people. To them, they see collecting $1000 or $2000 in premium vs. the risk of paying $100,000+ out on a claim. Not good odds if you were in Vegas. Hence why they shy away anytime they hear "racing" or "modifications" or things like that. It's not the on track stuff they're worried about, that's clearly excluded in the policy. It's the behavior they feel, right or wrongly, that a modified car may lead to. So they get very gun shy when they feel a car was modified for speed. It's the old story of the behavior of a few bad drivers causing issue for the rest. Often, these "modified" cars wind up in nasty wrecks that cost a fortune. I can give you tons of examples. I wouldn't even get into any on track stuff with them, it's not covered anyway, so it's not in their scope of interest.

You can get "on-track" policies too. As for the rest, I do not mind paying a little more to have my ass covered in event of a loss, but to just bluntly say no without a reason besides "too risky" or asking questions is dumb. Getting up everyday and going to take a shower is risky behavior. Heaven forbid, you might drown!!!

Klayfish wrote: You could try the "I'll take my business somewhere else" approach, but more often than not underwriters aren't swayed by that. Again, it's the thought process of losing a $2000 customer vs. the risk of having a huge claim. Not that they don't want to retain customers, of course they do, but it's statistics and numbers.

It will sway underwriters when you have an agent trying to get THEM business because agents like/need money too. You can only gain so many new customers to replace the ones you kick to the curb.

Ranger50 wrote: My definition of a scam is taking something of mine, using it for other purposes, and then when I need to use that item, I am told berkeley you. Insurance is a scam. I pay WAY more then my fair share because of where I live...

'Fair Share?'

This is insurance, not an investment plan. The only 'fair share' is what you're willing to pay for the service of insurance.

Taking something of yours? You're buying a product under certain terms. If you don't agree on the terms, its no different than getting a cold burger at McDonalds; you work to improve your position on the terms.

There is no savings account being set aside with your premiums just in case you have an accident. That would be a savings account, not an insurance policy.

People oft seem to have a fundamental mis-undertsanding of insurance services. They don't even know how an insurance company actually works as a business.