Insurance and Modifications
Thread Starter
Team Owner
Joined: Aug 2003
Posts: 38,314
Likes: 35
Insurance and Modifications
A lot of people here, in asking about modifications, ask about a specific modification: "Will this void my warranty???"
Perhaps a better question is: "Will this void my insurance policy?"
I took particular interest in what they had to say about nitrous.
http://articles.moneycentral.msn.com...eadyToPay.aspx
Perhaps a better question is: "Will this void my insurance policy?"
I took particular interest in what they had to say about nitrous.
http://articles.moneycentral.msn.com...eadyToPay.aspx
Instructor
Joined: Sep 2006
Posts: 233
Likes: 1
I would bet most people don't consider this aspect. Might be more reason to opt for the head and cam package as opposed to a turbos/blowers....After a bad wreck it might be hard explaining the chromed maggie away. On the other hand who would know you have added 100hp with H/C.
It would be interesting to know if any FI users have notified their insurance company and if so how much did your liability go up? I guess the conversation would go like this.....Well, my car is no longer 400Hp but rather 750HP. Its my daily commuter and I always obey the speed limit ....
It would be interesting to know if any FI users have notified their insurance company and if so how much did your liability go up? I guess the conversation would go like this.....Well, my car is no longer 400Hp but rather 750HP. Its my daily commuter and I always obey the speed limit ....
Thread Starter
Team Owner
Joined: Aug 2003
Posts: 38,314
Likes: 35
I would bet most people don't consider this aspect. Might be more reason to opt for the head and cam package as opposed to a turbos/blowers....After a bad wreck it might be hard explaining the chromed maggie away. On the other hand who would know you have added 100hp with H/C.
It would be interesting to know if any FI users have notified their insurance company and if so how much did your liability go up? I guess the conversation would go like this.....Well, my car is no longer 400Hp but rather 750HP. Its my daily commuter and I always obey the speed limit ....
It would be interesting to know if any FI users have notified their insurance company and if so how much did your liability go up? I guess the conversation would go like this.....Well, my car is no longer 400Hp but rather 750HP. Its my daily commuter and I always obey the speed limit ....
Same as if you had nitrous. After a bad front end accident and the adjuster got done looking at the car and saw the hookup, what would they say??
Burning Brakes
Joined: Sep 2006
Posts: 1,038
Likes: 1
From: North York Ontario
I had no idea that it made a difference until I got my renewal in February. I mentioned I was purchasing new rims (HRE's) and because they were fairily expensive I wanted to find out if they needed pictures and documentaiton. That lead to other questions about the car and as soon as I mentioned my Callaway CAI and Corsa Sports the alarm bells went off and I was told in no uncertain terms they would not renew my insurance.
I had to scramble to find another insurance company and I had to document all changes/mods and they made me agree to request in writing approval before I did any enhancement that increased horsepower.
That was an eye opening experinece. I am just glad I got this straightened out before I had a claim only to find out I was not covered.
I would recommend everyone come clean with their insurance company. God forbid you should have a personaly injury situation and your Insurance is voided it could leave you in financial ruin. It is just not worth the chance I sleep better knowing I have given my insurance company full disclosure.
I had to scramble to find another insurance company and I had to document all changes/mods and they made me agree to request in writing approval before I did any enhancement that increased horsepower.
That was an eye opening experinece. I am just glad I got this straightened out before I had a claim only to find out I was not covered.
I would recommend everyone come clean with their insurance company. God forbid you should have a personaly injury situation and your Insurance is voided it could leave you in financial ruin. It is just not worth the chance I sleep better knowing I have given my insurance company full disclosure.
Race Director
Joined: Dec 2005
Posts: 11,892
Likes: 107
From: God's Country, ID
I would just keep my mouth shut! However, If you are driving recklessly, it probably will not matter whether you have 400hp or 700hp!
My concern is getting a portion of my $$ back if someone hits/totals or steals my car! I have approx $16-17k in just engine mods.
I asked my Insurance agent (Allstate) and he stated to save all my receipts. I doubt they would pay for any of the labor though.
My concern is getting a portion of my $$ back if someone hits/totals or steals my car! I have approx $16-17k in just engine mods.
I asked my Insurance agent (Allstate) and he stated to save all my receipts. I doubt they would pay for any of the labor though.
Instructor
Joined: Sep 2006
Posts: 233
Likes: 1
The problem with being honest is you get screwed. As someone just previously posted they were dropped from a policy because of a CAI and mufflers. That is ridiculous. Even If you don't get dropped you will get unreasonable rates.
I agree the theft/comprehensive insurance is nice when you have upgrades that might otherwise be a total loss but when it comes to performance mods i would bet it doesn't make good economical sense to insure them.
As far as liability, I would think it would be very difficult for an insurance company to deny a claim because of performance mods. They would have to determine an accident was caused by "additional horsepower". I am not an attorney but I would think in most cases they would be stuck having to pay. However, I still think this is another "pro" to stealth mods.
I agree the theft/comprehensive insurance is nice when you have upgrades that might otherwise be a total loss but when it comes to performance mods i would bet it doesn't make good economical sense to insure them.
As far as liability, I would think it would be very difficult for an insurance company to deny a claim because of performance mods. They would have to determine an accident was caused by "additional horsepower". I am not an attorney but I would think in most cases they would be stuck having to pay. However, I still think this is another "pro" to stealth mods.
Melting Slicks
Joined: Oct 2006
Posts: 2,905
Likes: 1
Having had an accident in a 2000 TA with a procharger,built LS6,headers,Borlas,moser 12 bolt and all the goodies,etc,I know firat hand the "other people's" insurance won't care one bit.I had every reciept down to the oil changes and bulb swaps and they didn't care one bit.I had to go through litagation and two apprasials along with my shop's written statements and still had problems getting enough in the end.Only a diminished value claim I filed after I read up on it on the internet helped me recoupe some of the costs of the mods and they fixed the car back the way it was with parts of my choice(as long as they were in place before). BTW, don't even think that your ins will cover you if you wreck at a track...
Drifting
Joined: Dec 2004
Posts: 1,777
Likes: 0
From: Berkeley CA
Thanks for the info.. Its certainly a subject that those who modify their rides don't want to think about but ignorance won't help anyone.
I am sure that many of us have substantial assests which outvalue our rides. Make sure we don't have it at risk. There is a right way to do this and the information is available. Make sure you do the right thing
for your own and the sake of those who count on you.
Let me correct that. Whatever decision you arrive at make sure it is an informated and responsible one. Just my 2 cents.
I know the subject is such a bummer but so important also.
Good luck to you and yours.
I am sure that many of us have substantial assests which outvalue our rides. Make sure we don't have it at risk. There is a right way to do this and the information is available. Make sure you do the right thing
for your own and the sake of those who count on you.
Let me correct that. Whatever decision you arrive at make sure it is an informated and responsible one. Just my 2 cents.
I know the subject is such a bummer but so important also.
Good luck to you and yours.
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Former Vendor
Joined: Aug 2005
Posts: 5,774
Likes: 0
From: Loganville GA
you need to check with your company. I had a supercharged 350z, and added an additional 15000 in coverage for all of my aftermarket parts. They charged me about 150/yr for the additional coverage and didn't add anything to liability.
Likewise, a friend had a 350z show car, insured with state farm. He is an over-the-top show car guy, and had his insured for 60,000. No increase in liability, even though it was supercharged. A couple months ago, someone hit him in the front end and the tow truck driver forgot to tie his car down and it fell off the back of the tow truck. He got the full $60000 for his car from the insurance company, plus the electronics, as it actually appraised for about 65k.
Its always best to get the added coverage!
Likewise, a friend had a 350z show car, insured with state farm. He is an over-the-top show car guy, and had his insured for 60,000. No increase in liability, even though it was supercharged. A couple months ago, someone hit him in the front end and the tow truck driver forgot to tie his car down and it fell off the back of the tow truck. He got the full $60000 for his car from the insurance company, plus the electronics, as it actually appraised for about 65k.
Its always best to get the added coverage!
Tech Contributor
Joined: Jul 2002
Posts: 14,950
Likes: 264
From: St. Louis, MO
St. Jude Donor '08
you need to check with your company. I had a supercharged 350z, and added an additional 15000 in coverage for all of my aftermarket parts. They charged me about 150/yr for the additional coverage and didn't add anything to liability.
Likewise, a friend had a 350z show car, insured with state farm. He is an over-the-top show car guy, and had his insured for 60,000. No increase in liability, even though it was supercharged. A couple months ago, someone hit him in the front end and the tow truck driver forgot to tie his car down and it fell off the back of the tow truck. He got the full $60000 for his car from the insurance company, plus the electronics, as it actually appraised for about 65k.
Its always best to get the added coverage!
Likewise, a friend had a 350z show car, insured with state farm. He is an over-the-top show car guy, and had his insured for 60,000. No increase in liability, even though it was supercharged. A couple months ago, someone hit him in the front end and the tow truck driver forgot to tie his car down and it fell off the back of the tow truck. He got the full $60000 for his car from the insurance company, plus the electronics, as it actually appraised for about 65k.
Its always best to get the added coverage!
1. I did not get one dime for my mods. Despite having all receipts. In the end it came down to... they gave me full retail value for the car. I complained, they said, show us a car with comparable mods and we'll talk. Guess what. You can buy H/C cars all day long for retail (dealer lot) prices for used cars. As you all know there is a huge difference between retail and wholesale. They told me if I had a stated value policy like my old muscle cars it would have been different.
2. My buddy realized this and called his insurance company (Geico) to get a stated value policy on his modded car. Guess what. They canceled him the next day.
Lessons learned the hard way:
1. Don't park a Vette in the driveway. Or don't live in Miami I guess.
2. You mod for yourself. You don't get any money for them unless you take them off before you sell the car and sell them separately. If your car is stolen you are doubly screwed.
Race Director
Joined: Oct 2004
Posts: 10,089
Likes: 14
Just shows you shouldn't always believe everything a financial reporter or insurance industry PR flack says. Fact is, nitrous systems are not "illegal in most states" (in fact some systems have CARB approval, making them 50 state legal, most of the rest are 49 state legal). The myth that nitrous systems are illegal is a PITA for those of us who do run nitrous. It is prudent to keep the pertinent approval documents in the car so if you get hassled you can prove you're legal.
Safety Car
Joined: Jun 2004
Posts: 4,430
Likes: 81
From: Whidbey Island WA
I decided to dig my policy out and did not see anything that requires me to report mods or anything that says they can deny me insurance because of them. Not being a lawyer I cant say there isn't language somewhere in there that they could use for this purpose.
I did see where they would not cover me if the car was damaged during the commission of a crime. Makes sense that they don't want to cover a car that got folded up during a high speed pursuit following a convenience store robbery. I'm wondering if they could use this to deny you if you had an accident and where hit with criminal negligent driving? Seems possible but again I'm not an attorney.
I did see where they would not cover me if the car was damaged during the commission of a crime. Makes sense that they don't want to cover a car that got folded up during a high speed pursuit following a convenience store robbery. I'm wondering if they could use this to deny you if you had an accident and where hit with criminal negligent driving? Seems possible but again I'm not an attorney.
Instructor
Joined: May 2006
Posts: 203
Likes: 0
From: Columbus Georgia
nitrous is illegal in georgia if it is hooked up. if they find juice in the
line they may impound your car.
I had a guy take off the left front fender, tire and bent the frame on my 96 ss.(heads/cam/nitrous) and a number on the window from the drag strip. cops said nothing. went out of town on monday and forgot
to wipe the numbers off the car, insurance guy came by tuesday and said nothing to my wife about anything. my wife said he was very impressed how neat everything was set up and wrote out a check for repairs.
line they may impound your car.
I had a guy take off the left front fender, tire and bent the frame on my 96 ss.(heads/cam/nitrous) and a number on the window from the drag strip. cops said nothing. went out of town on monday and forgot
to wipe the numbers off the car, insurance guy came by tuesday and said nothing to my wife about anything. my wife said he was very impressed how neat everything was set up and wrote out a check for repairs.
Thread Starter
Team Owner
Joined: Aug 2003
Posts: 38,314
Likes: 35
Just shows you shouldn't always believe everything a financial reporter or insurance industry PR flack says. Fact is, nitrous systems are not "illegal in most states" (in fact some systems have CARB approval, making them 50 state legal, most of the rest are 49 state legal). The myth that nitrous systems are illegal is a PITA for those of us who do run nitrous. It is prudent to keep the pertinent approval documents in the car so if you get hassled you can prove you're legal.
However, what happens if you are in a serious front end accident, in which you are at fault, and the insurance company's representative examines your car and finds nitrous plumbing, bottle warmer, purging system, window switch and solonoids hooked up to it?
Are you still covered, or can they say that you were spraying at the time of the accident and this is what led to it?
Last edited by '06 Quicksilver Z06; May 5, 2007 at 04:32 PM.
Race Director
Joined: Oct 2004
Posts: 10,089
Likes: 14
No, nitrous is not illegal in most states.
However, what happens if you are in a serious front end accident, in which you are at fault, and the insurance company's representative examines your car and finds nitrous plumbing, bottle warmer, purging system, window switch and solonoids hooked up to it?
Are you still covered, or can they say that you were spraying at the time of the accident and this is what led to it?
However, what happens if you are in a serious front end accident, in which you are at fault, and the insurance company's representative examines your car and finds nitrous plumbing, bottle warmer, purging system, window switch and solonoids hooked up to it?
Are you still covered, or can they say that you were spraying at the time of the accident and this is what led to it?
Race Director
Joined: Oct 2004
Posts: 10,089
Likes: 14
nitrous is illegal in georgia if it is hooked up. if they find juice in the
line they may impound your car.
I had a guy take off the left front fender, tire and bent the frame on my 96 ss.(heads/cam/nitrous) and a number on the window from the drag strip. cops said nothing. went out of town on monday and forgot
to wipe the numbers off the car, insurance guy came by tuesday and said nothing to my wife about anything. my wife said he was very impressed how neat everything was set up and wrote out a check for repairs.
line they may impound your car.
I had a guy take off the left front fender, tire and bent the frame on my 96 ss.(heads/cam/nitrous) and a number on the window from the drag strip. cops said nothing. went out of town on monday and forgot
to wipe the numbers off the car, insurance guy came by tuesday and said nothing to my wife about anything. my wife said he was very impressed how neat everything was set up and wrote out a check for repairs.
Melting Slicks
Joined: Sep 2000
Posts: 3,040
Likes: 0
From: North Liberty IA
St. Jude Donor '07
OK, I guess I'm confused. Insurance company X quotes you a premium for a box stock Corvette and you pay that premium.
You then invest $1.2M in upgrades to your Corvette.
Do you honestly expect them to may you $1.2M if you have a wreck? You didn't pay them a premium appropriate for a modified Vette. They'll get you back to a box stock Corvette, just like the premium was calculated.
How could anything else be fair.
If you want to insure the mods, feel free. Call up your agent and give them the value of your mods. I did it on my supercharged 540 wagon. The insurance price increase would have paid for a new supercharger, installed, every 18 months. In other words, they didn't want to insure it. They didn't care that I had it, just didn't want to pay for it in a wreck.
I'm cool with that.
The main stream, cheapest on the block, companies don't want modified cars as they rightfully know that the cars are more likely to be in an accident, because they are more powerful. They want the cream of the drivers. Tier 2 companies, often about the same price, don't care.
All decent business decisions on their part. Don't fault them at all.
You then invest $1.2M in upgrades to your Corvette.
Do you honestly expect them to may you $1.2M if you have a wreck? You didn't pay them a premium appropriate for a modified Vette. They'll get you back to a box stock Corvette, just like the premium was calculated.
How could anything else be fair.
If you want to insure the mods, feel free. Call up your agent and give them the value of your mods. I did it on my supercharged 540 wagon. The insurance price increase would have paid for a new supercharger, installed, every 18 months. In other words, they didn't want to insure it. They didn't care that I had it, just didn't want to pay for it in a wreck.
I'm cool with that.
The main stream, cheapest on the block, companies don't want modified cars as they rightfully know that the cars are more likely to be in an accident, because they are more powerful. They want the cream of the drivers. Tier 2 companies, often about the same price, don't care.
All decent business decisions on their part. Don't fault them at all.
Thread Starter
Team Owner
Joined: Aug 2003
Posts: 38,314
Likes: 35
They can say anything that they like. But that's beside the point, if you are at fault in the accident, you're at fault. They have to pay if you're at fault because you were drunk, they have to pay if you're at fault because you had a stroke, they have to pay if you're at fault because you were just driving like an idiot. Etc. All the same. They insured you against civil liability when you cause an accident. Doesn't matter exactly how or why you caused the accident. They still have to pay (unless there are specific exclusions in the policy that apply, read the fine print).
"Let's say you're driving a hopped-up car that your insurer doesn't know is altered, and while trying to pass another car you lose control and hit people standing at a bus stop. The insurance company might try to get out of paying, arguing that the loss wouldn't have happened if the car hadn't been modified in an unsafe way, and that you, the policy owner, have essentially committed fraud, says Ellen Anderson, president and owner of Illinois-based Rally Insurance, a broker specializing in insurance for antique and specialty vehicles.
"Is it likely that they would pay in a situation like that? Well, a 50/50 chance," she says. "You could really end up in a real financial jam in a situation like that."
I hope that you don't have to put your theories to the test Shopdog.
And actually no they don't have to pay if you were drunk. I know someone right now whose mother was involved in a single car accident and was paralyzed.
She was drunk. And the insurance company is not picking up a cent of this person's medical bills.
Team Owner
Joined: Oct 2001
Posts: 56,381
Likes: 79
"Let's say you're driving a hopped-up car that your insurer doesn't know is altered, and while trying to pass another car you lose control and hit people standing at a bus stop. The insurance company might try to get out of paying, arguing that the loss wouldn't have happened if the car hadn't been modified in an unsafe way, and that you, the policy owner, have essentially committed fraud, says Ellen Anderson, president and owner of Illinois-based Rally Insurance, a broker specializing in insurance for antique and specialty vehicles.
"Is it likely that they would pay in a situation like that? Well, a 50/50 chance," she says. "You could really end up in a real financial jam in a situation like that."
I hope that you don't have to put your theories to the test Shopdog.
And actually no they don't have to pay if you were drunk. I know someone right now whose mother was involved in a single car accident and was paralyzed.
She was drunk. And the insurance company is not picking up a cent of this person's medical bills.
"Is it likely that they would pay in a situation like that? Well, a 50/50 chance," she says. "You could really end up in a real financial jam in a situation like that."
I hope that you don't have to put your theories to the test Shopdog.
And actually no they don't have to pay if you were drunk. I know someone right now whose mother was involved in a single car accident and was paralyzed.
She was drunk. And the insurance company is not picking up a cent of this person's medical bills.
Instructor
Joined: Sep 2006
Posts: 233
Likes: 1
Seems to be different opinions on this but I think the following is the general consensus.
1. It's not worth insuring performance mods because as previously noted ins. company's don't want you because you are high risk...therefore if they don't dump you then they will charge you enough to wish you hadn't asked in the first place. Theft is a given and it will be a loss. But remember...the cost of 1 or 2 years premiums may pay the replacement anyway...
2. The scary part is liability. If you are involved in vehicular homocide could you be denied liablity coverage?? I wouldn't think so unless its DUI...i know insurance company's have clauses in regard to this.
Would be nice to here from someone in the insurance industry.
1. It's not worth insuring performance mods because as previously noted ins. company's don't want you because you are high risk...therefore if they don't dump you then they will charge you enough to wish you hadn't asked in the first place. Theft is a given and it will be a loss. But remember...the cost of 1 or 2 years premiums may pay the replacement anyway...
2. The scary part is liability. If you are involved in vehicular homocide could you be denied liablity coverage?? I wouldn't think so unless its DUI...i know insurance company's have clauses in regard to this.
Would be nice to here from someone in the insurance industry.