Last Updated on December 28, 2025

Upgrading your car can make it safer, more comfortable, or more fun to drive—but it can also change how your vehicle is insured. Most car insurance companies price and settle claims based on your vehicle’s factory configuration unless you tell them about changes and add the right coverage.

If you want your custom parts to be covered after a theft, storm, or accident, it’s smart to notify your insurer before you install them. Below is how insurance typically works for modified vehicles, which mods can lower or raise your premium, and how to protect your upgrades.

Key Takeaways

• You don’t always have to report every small change, but undisclosed modifications may not be covered (and can complicate a claim).
• Safety and anti-theft upgrades can sometimes qualify for discounts, while performance and cosmetic mods can increase rates or limit coverage.
• To protect expensive upgrades, you may need Custom Parts and Equipment Coverage (a special endorsement/rider) with receipts and photos.
• If your insurer won’t cover your build, compare quotes with carriers that accept modified vehicles and confirm what “full coverage” includes.

Do You Have to Tell Your Insurance Company About Modifications?

You’re not always legally required to call your insurer every time you make a small change. But if you don’t disclose modifications, two common problems come up:

• Your upgrades may not be covered. If your vehicle is damaged, many policies pay to repair/replace the car back to “stock” condition—not the aftermarket version. Even replacement parts can vary by policy and state. (Related: Will my insurance company pay for OEM parts after an accident?)
• A claim could get complicated. If the insurer discovers major undisclosed modifications—especially performance-related changes—it can trigger extra scrutiny or disputes. In extreme cases, non-disclosure can contribute to a denied claim depending on the facts and your policy language. (More on denials: How and why can insurers deny your claim?)

A good rule of thumb: if the modification is expensive, changes performance, or materially changes the vehicle’s appearance or risk profile, tell your insurer and ask how it affects coverage.

Modifications That Can Lower Your Premium

Some upgrades can reduce your rates because they lower the likelihood of theft or injuries—or make accidents less severe. Not every carrier discounts every feature, but these are common examples:

• Safety upgrades like advanced driver-assistance features and other qualifying equipment (see: safety features auto insurance discounts).
• Anti-lock brakes and similar braking or stability improvements (see: anti-lock brakes auto insurance discount).
• Backup cameras and visibility upgrades that reduce low-speed collisions (see: backup camera car insurance discount).
• Newer vehicle technology that improves safety or theft prevention (see: new technology that will help you save on car insurance).

Tip: Keep receipts and take photos right after installation. Even if the upgrade earns a discount, documentation helps if you ever need to prove what was added and when.

Modifications That Can Raise Your Premium

Other upgrades can increase premiums because they raise repair costs, increase theft risk, or suggest more aggressive driving. Common examples include:

• Performance modifications (turbo/supercharger kits, engine tuning, suspension changes, aftermarket wheels/tires, brake upgrades, etc.).
• Cosmetic upgrades that increase repair costs (custom paint, wraps, body kits, specialty lighting).
• Window tint and similar changes that can affect risk and claim handling (see: Will tinting my windows change my auto insurance rates?).

If your insurance suddenly gets expensive and you haven’t had accidents, vehicle changes can be part of the puzzle. This guide can help you think through other common reasons: Why is my insurance so high with no accidents?

How to Get Modifications Covered

In many standard policies, custom equipment is either excluded or covered only up to a small limit. If you want real protection for expensive upgrades, you’ll usually need to add coverage specifically for the modified parts.

The most common solution is a car insurance endorsement that increases coverage for aftermarket equipment. This add-on is often called Custom Parts and Equipment Coverage (CPE) (or a “special equipment” rider).

For certain categories—like high-end stereos and audio systems—some insurers treat these upgrades differently or require a separate approach. If audio is your main upgrade, this can be a helpful reference: special insurance coverage for stereo or audio equipment.

What Your Insurer Will Typically Ask For

Expect your insurer (or agent) to request details so they can underwrite the risk and document the vehicle’s condition. Common requests include:

• Receipts/invoices for parts and labor
• Photos of the vehicle (and close-ups of the modifications)
• A list of parts installed, including brands/model numbers when available
• In some cases, an appraisal for higher-value builds

This is also a good time to review your car insurance policy so you understand what’s covered, what’s excluded, and any special limits for custom equipment.

Special Cases: Classic Cars, Collector Cars, and Luxury Vehicles

If you’ve modified a classic/collector vehicle, “standard” auto insurance may not be the best fit—especially if the build is valuable or hard to replace. Specialty policies may offer agreed value options and more tailored coverage. Learn more here: how to insure a classic or collector vehicle.

For high-end cars, repairs and parts costs can be steep even before modifications, so getting the right coverage matters. This guide is a helpful next step: Do you need special coverage for a high-end or luxury vehicle?

If Your Current Insurer Won’t Cover Your Modifications

Some carriers won’t insure heavily modified vehicles at all, or they’ll limit you to liability-only coverage. If that happens, you may need to shop around—or switch carriers entirely. Here’s what to know if you’re considering changing insurers before your renewal: Can I switch my car insurance company mid-policy?

Also keep in mind that, depending on the situation, an insurer can sometimes deny coverage or decline to write a policy. Being upfront about modifications helps you avoid unpleasant surprises when you need coverage most.

When comparing quotes, make sure you understand what “full coverage” really means and whether it includes what you expect for your vehicle and upgrades. (Related: Is full coverage the same as comprehensive coverage?)

FAQs on Car Insurance for Modified Vehicles

Final Word on Insurance for Modified Vehicles

If you’re planning modifications, talk to your insurer (or a trusted professional) before you install anything expensive. A quick conversation can clarify whether you need an endorsement, how claims will be handled, and what documentation to save.

If you want help comparing options, understanding coverage limits, or finding a carrier that’s comfortable with modified vehicles, working with a professional can make things easier. Here’s a quick overview of who does what: What is the difference between a car insurance broker and an agent?