Custom Parts and Equipment Coverage Explained

Last Updated on December 31, 2025

If you’ve upgraded your vehicle with aftermarket wheels, a custom stereo, a lift kit, accessibility equipment, or a one-of-a-kind paint job, your auto policy may mention custom parts and equipment coverage—often shortened to CPE.

CPE is an add-on (endorsement) that can help pay to repair or replace permanently installed modifications after a covered loss—like a crash, theft, vandalism, or weather damage (depending on your policy).

Without CPE, you might find out the hard way that your insurer will repair your car… but not fully pay for the customizations that made it more valuable or unique.

Key Takeaways

• Custom parts and equipment coverage (CPE) is an optional add-on that helps protect permanently installed aftermarket upgrades on your vehicle.
• CPE typically works with comprehensive and collision coverage and may not be available if you only carry liability-only insurance.
• Common covered upgrades include custom wheels, stereos, paint, body kits, and accessibility equipment—but exclusions and definitions vary by insurer.
• Keep receipts and photos, choose a limit that matches your modifications, and disclose upgrades to avoid claim disputes and underpayment.

What Is Custom Parts and Equipment Coverage?

Custom parts and equipment coverage (CPE) is optional coverage that extends protection to certain non-factory items you’ve added to your vehicle—typically items that are permanently attached and change your vehicle’s appearance, performance, or functionality.

CPE is usually designed to cover modifications that aren’t included in your car’s stock value, such as aftermarket accessories, custom finishes, upgraded electronics, and specialty equipment installed after purchase.

Important: every insurer defines “custom parts and equipment” a little differently. Your policy contract (and any endorsements) is the final word on what is covered.

How CPE Works With Comprehensive and Collision

CPE generally works alongside your physical damage coverages:

• Collision helps pay for damage to your vehicle after a crash (with another car or object).
• Comprehensive helps pay for non-collision losses (like theft, vandalism, hail, fire, or falling objects).

CPE is typically not a standalone policy. In many cases, you’ll need comprehensive and collision for the vehicle before you can add CPE coverage.

Also note: liability coverage doesn’t pay to repair your car. It pays for injuries or property damage you cause to others. So if you only carry liability coverage, your custom parts may have no protection for theft or damage to your own vehicle.

What Does Custom Parts and Equipment Coverage Usually Cover?

Coverage varies by insurer, but CPE commonly applies to permanently installed upgrades such as:

• Aftermarket electronics like a custom stereo or audio equipment, installed navigation systems, or built-in entertainment systems
• Exterior customizations like body kits, spoilers, custom grilles, and non-factory trim
• Custom finishes such as custom paint jobs, wraps, decals, graphics, or murals (when covered by your insurer)
• Wheels and tires like aftermarket rims, specialty tires, or upgraded wheel packages
• Lighting upgrades such as added fog lights, off-road lighting, or upgraded headlight assemblies (subject to legality and policy rules)
• Performance and suspension modifications such as upgraded exhaust systems, suspension upgrades, or other performance-related equipment (when allowed by the insurer)
• Utility and appearance add-ons like running boards, brush guards, camper shells, roof racks, or trailer hitches
• Mobility and accessibility equipment such as wheelchair lifts and wheelchair-accessible vehicle modifications

When in doubt, ask your insurer two very specific questions: (1) “Is this modification considered custom equipment under my policy?” and (2) “Do I need to list it or add an endorsement for it to be covered?”

What Is Not Covered by Custom Parts and Equipment Coverage?

CPE usually has meaningful exclusions. While your exact policy language controls, common “not covered” categories include:

• Normal wear and tear and age-related deterioration (see: does car insurance cover normal wear and tear?)
• Routine service and maintenance (see: will car insurance cover regular and routine maintenance?)
• Loose or portable personal property inside the car (phones, laptops, tools, cameras, sports gear). These are often covered—if at all—by homeowners or renters insurance, not auto insurance.
• Modifications that aren’t street-legal in your state, or changes that violate policy rules (some insurers exclude certain high-risk or non-compliant modifications)
• Items used for business purposes or specialized equipment that needs a commercial policy or separate endorsement (for example, some snowplowing equipment scenarios)
• Anything above your coverage limit (CPE typically has a specific maximum payout for custom equipment)

Even if you have CPE, it’s smart to read the endorsement itself. Some policies cover only certain categories of modifications, and others require professional installation or documentation.

CPE Limits, Deductibles, and Total Loss Payouts

Most CPE endorsements come with a separate coverage limit for custom equipment. If your upgrades are worth more than the limit, you may only be reimbursed up to that cap (minus your deductible).

In many cases, CPE losses are also subject to the same deductible you carry for comprehensive or collision—so a higher deductible can reduce your premium, but it also increases what you’ll pay out of pocket after a claim.

Total loss note: When a vehicle is totaled or stolen and not recovered, payouts can get complicated. Some policies treat custom equipment differently in a total loss, and others cap payment in ways that depend on the vehicle’s actual cash value and policy language. If you’ve invested heavily in modifications, ask your insurer how custom parts are handled in a total loss before you buy the endorsement.

Does Custom Parts and Equipment Coverage Increase Your Premium?

It can—but the increase depends on the value and type of modifications, your deductible, your claim history, and your insurer’s underwriting rules.

For smaller upgrades, CPE may add only a modest amount to your premium. For high-value equipment (or modifications that increase theft risk or performance risk), the cost can be higher—or your insurer may require additional documentation, limit the coverage available, or decline to insure the vehicle as modified.

How to Add Custom Parts and Equipment Coverage

CPE is usually added as an insurance endorsement, meaning it modifies and supplements your existing policy. Adding it is often straightforward, but getting the details right matters.

Here’s a practical checklist:

• Inventory your upgrades. Make a list of every modification you want covered.
• Save receipts and proof of installation. Keep invoices, serial numbers (for electronics), and before/after photos.
• Estimate replacement cost. Include parts and typical labor costs—especially for specialty installs.
• Ask how your insurer defines “custom equipment.” Confirm what’s considered covered equipment and what’s excluded.
• Choose a limit that matches your investment. If your upgrades exceed the cap your insurer offers, ask about alternatives (see next section).
• Update your policy as you modify. A vehicle build can change over time—keep coverage in sync.

How to Avoid Claim Problems With Modified Vehicles

Modified vehicles can trigger claim disputes if the insurer wasn’t informed, the upgrades can’t be documented, or the policy excludes the specific modification.

One of the most common (and avoidable) mistakes is hiding modifications. If the adjuster discovers undisclosed changes after a loss, you could receive less than expected—or the claim could be challenged depending on the facts and policy terms. If you want to understand how claim denials happen and how to reduce the risk, read: how and why insurers can deny your claim.

If you have unusual upgrades (or a lot of them), it’s also smart to request confirmation in writing about what will and won’t be covered.

Alternatives If You’ve Heavily Modified Your Car

If your vehicle has extensive modifications that push beyond what a standard CPE endorsement can handle, consider these options:

• Specialty or custom car insurance designed for modified vehicles
• Agreed value or stated amount coverage (common with classic or collector policies), where the vehicle’s value is established up front
• Scheduling specific equipment (when available), which may require receipts, photos, or appraisals

The right solution depends on how you use the vehicle (daily driver vs. show car vs. weekend toy) and how much of its value is tied to upgrades.

FAQs About Custom Parts and Equipment Coverage

Final Word on Custom Parts and Equipment Coverage

Custom parts and equipment coverage can be a smart add-on if you’ve invested money into permanent upgrades that a standard auto policy may not fully protect. The key is to match your coverage limit to the real value of your modifications, understand exclusions, and keep documentation so your claim is easier to prove.

If you’re not sure what your policy already covers, ask your insurer for the exact language of the CPE endorsement (or the policy section that addresses custom equipment) and confirm how claims are handled—especially for theft and total losses.