Car modifications that don't affect insurance

If you're into cars, it's completely normal to want to tweak your ride—whether it's for better performance or just to make it look cooler. But here's the thing: some modifications can affect your insurance rates and coverage, while others might not. Whether you're upgrading the look or enhancing the safety and handling, most vehicle modifications will impact your car insurance in some way. And the key takeaway? You need to let your insurance provider know about all of them.

Do all car modifications affect car insurance?

It really comes down to what you're changing. If you're doing something simple, like putting on new tires, it won't affect your insurance premium unless they're winter tires, then you might qualify for a discount! Non-performance upgrades like that usually aren’t a big deal; you just need to let your insurer know so they know you've made them.

That said, there’s often a limit to how much you can insure this way. For example, if you start replacing several parts, even if they’re not performance-related, you might be pushing the boundaries. Therefore, it’s always a good idea to double-check with your insurance company or broker.

What are car modifications?

A modified car is basically any car that’s been changed from how it originally came off the production line. This could be about improving the way it looks or how it performs.

Many car enthusiasts want their cars to do more than they were originally built for. These upgrades can enhance engine performance, fuel efficiency, or even how the car handles on the road. Modifications can be anything from customizing the interior and adding a better sound system to more technical upgrades like engine tuning, suspension tweaks, or new tires.

People modify their cars for all kinds of reasons—whether it’s to make them look cooler, improve their car's performance, stand out from the crowd, or just create something that suits their personal style.

Why do car modifications affect insurance?

Car modifications can do all sorts of things—make your car look better, handle smoother, boost safety, increase speed, and more. If you're making changes that don’t affect how the car drives or ones that improve safety and control, you might wonder, "Why would I need to tell my insurer?" or "That won’t change my insurance, right?" But from your insurer’s point of view, any modification could raise your car’s value or even make it more attractive to thieves or more vulnerable to damage.

Some modifications can also impact how your car handles and its overall safety. For example, changing the suspension alters how the car drives and could increase the risk of accidents. Engine upgrades that boost power are another example of changes that could raise the risk factor.

On the other hand, accessibility modifications like wheelchair lifts, ramps, pedal extensions, and hand controls can make your vehicle more usable, but they can be expensive. Your insurer will need to factor in the cost of replacing that equipment, and you'll want to make sure it's properly covered in your policy. These are all things your insurer definitely cares about when determining your premiums.

If I modify my car, will my car insurance cover it?

Usually, insurance companies won’t automatically cover any modifications you make to your car. That’s because most standard auto insurance policies only cover what came with the car from the factory. So, if you're upgrading your vehicle, you’ll likely need specialty insurance—specifically, something called “modified car insurance.”

In the following section, we will delve into the topic of modified car insurance, examining what it entails and exploring whether standard auto insurance policies typically cover modifications. We will look at the factors influencing coverage decisions and provide insight into what car owners can expect when insuring a modified vehicle:

Modified car insurance

Modified car insurance covers aftermarket parts and vehicle upgrades, ensuring that your entire car, including any new or custom parts, is protected. However, whether you actually need this type of insurance depends on what modifications you’re making.

As we mentioned earlier, if you're making non-performance modifications, like just changing your tires, you shouldn't need special insurance for modified cars. However, if you’re making cosmetic changes, like adding new wheels, or performance upgrades, like turbocharging, lowering or lifting the car, or anything to make it faster, then yes, you’ll definitely want modified car insurance. And if you're adding performance parts to the car you drive every day, you might even need a whole new policy that will cover these additional modifications.

Some insurance providers may require a separate modified car insurance policy, while others offer add-on coverage for custom or performance parts. That's why it’s a good idea to check with your car insurance provider or broker before making any changes to your car.

How do car modifications affect my insurance premiums?

Adding performance parts to your car is pretty much guaranteed to mess with your standard insurance policy—and usually, it means your premiums are going to rise. The reason? Modified parts are often more expensive to repair or replace if something goes wrong. Since modifications usually add value beyond the original price, your insurance company might have to pay more if you file a claim, so you’ll need to pay more to insure them.

To figure out how much your insurance rates will go up, you’ll probably need to work with an appraiser who can list and value all your performance parts. Modified car insurance typically works on a replacement-cost basis, meaning it covers the actual value of each of the parts you've added.

Once that list is complete, you and your insurance company will agree on your modified car’s total value. While this kind of policy will likely cost more than a standard one, the upside is that you’ll get much better coverage for all those upgrades.

How much does modified car insurance cost?

The cost of insurance for a modified car can vary depending on the specific changes you've made. Some modifications might even put you in a high-risk category, which can drive up your premiums even more. It's a good idea to talk to your insurance broker or provider to get an accurate estimate of how much your rates will increase.

Popular car modifications that can increase your insurance premiums

Before you start modifying your car, it's important to think about how it might impact your insurance premiums. If you're making the car more valuable, more attractive to thieves, or faster, there’s a good chance your insurance premiums will increase.

However, whatever you do, don’t skip telling your insurer to avoid an increase. Failing to declare your modifications could invalidate your insurance, which means your insurance company could deny a claim, and you'd be left to cover the bills on your own. On that note, here are ten modifications that could increase your insurance premiums:

1. Wheel modifications

If you're swapping out steel wheels for alloy ones, expect your insurance premium to go up. Sure, alloy wheels might make your car handle better, but they’re also pricier and a big target for thieves. Even just painting your standard wheels could lead to a premium increase, and if you’re fully upgrading them, it’s likely to cost you even more on your insurance.

In Canada, wheel modifications are allowed as long as the tire's external diameter stays the same as the original.

2. Engine modifications

Adding a turbocharger to your car's engine might boost performance and improve fuel efficiency, but it’s also likely to raise your insurance costs. Turbochargers or superchargers are usually more expensive to repair, and the added power and speed can increase the risk of accidents. Turbochargers and superchargers are generally legal in Canada as long as they don’t fail emissions or safety inspections.

Plus, if you don’t tell your insurer about them, it could completely void your insurance. The same goes for engine tuning and reprogramming—if you don’t report those, your policy could be invalidated as well.

Further, removing the oxygen sensor or charcoal canister from your vehicle is illegal. However, installing a breather filter or cold air intake system is allowed as long as the emission control equipment remains intact.

3. Exhaust system modifications

Modifying your exhaust system will likely raise your insurance premiums because it can boost engine performance. Installing a larger cat-back exhaust system allows exhaust gases to escape more freely, which can increase your engine’s power. Just make sure the new system is securely installed, leak-free, designed for road use, and doesn’t make more noise than the original.

In Canada, cat-back exhaust systems are generally legal but keep in mind that larger exhausts can be louder. Your exhaust shouldn’t be too noisy or unusual, especially in residential areas. It also can't have smoke coming out of it. You need to make sure it complies with federal and provincial emissions standards.

4. Seat modifications

Changing the seats in your car can affect your insurance in a few ways. If you reupholster or upgrade them, you’re increasing the value of your car, which means your premiums will probably go up. Even if the new seats don’t add value, if they don’t meet safety standards, your insurance could still rise.

In Canada, you’re allowed to replace your car’s seats as long as you use the original parts, like the rails or anchors. Just make sure the new seats are compatible with your seatbelt and airbag system to stay within safety guidelines.

5. Bodywork and paintwork modifications

Bodywork modifications might help you personalize your car’s look, but they can also affect safety, which will likely raise your insurance premiums. For instance, adding larger bumpers or side skirts increases the risk of damage on rough roads or when navigating tight spaces. Other body modifications, like modified wheel arches, roof racks, flared wings, spoilers, and valances, can also bump up your insurance costs.

Keeping your paintwork in good condition is important because it protects your car’s body. However, if you opt for a custom paint job like a vehicle wrap, especially an expensive or unusual colour, it can raise your car’s value and increase repair costs—both of which can lead to higher premiums.

6. Window modifications

Tinting your windows is a popular modification, but did you know it’s not legal in all Canadian provinces? It’s also not always considered a safe upgrade in places where it is legal. Modifying your windows can impact both your car’s value and its safety and, thus, your insurance premiums.

If the driver’s side window is too dark, it can make it harder for pedestrians and other road users to see if they’re making eye contact with the driver. Tinted windows can also pose a safety risk in serious accidents, as the film can make it harder to break the glass with a window punch during a rescue. Any added risk to your safety will be taken into account by your insurance provider.

7. Suspension modifications

You can lower your car’s suspension as long as it doesn’t mess with the steering or the angle of the headlights. However, you still need to let your insurer know because lowering your car can make it more vulnerable to damage from speed bumps or rough roads.

8. Custom light modifications

Many people have been upgrading their headlights to LED lights. But did you know that white and amber are the only colours allowed on the front of your vehicle? If you're considering adding side marker lights, your vehicle must be over 6.1 meters long, and the lights can’t flash or be visible from the front. It's also against the law to cover your headlights with tinted or coloured materials.

9. Brake modifications

Upgrading your car’s brakes is a popular modification that can improve the safety and overall control of your car, but it might also make repairs more expensive if you're in an accident. If you opt for more expensive brake discs like slotted brake discs or carbon ceramics, your car's value can be increased.

10. Adding Nitrous Oxide (NOS)

If adding NOS to your car were legal in Canada, it would definitely hike up your insurance premiums. These systems can be risky if not installed properly because they raise cylinder pressure. But here’s the thing—it’s actually illegal in Canada. If you get caught with NOS, you could face fines up to $2,000 and even six months in jail, not to mention a big spike in your insurance premiums.

How car modifications impact insurance premiums

Most likely, yes. Modified parts typically cost more to repair or replace if something goes wrong. Because these upgrades increase the value of your car beyond its original price, your insurance company may have to cover a higher amount if you file a claim, which means you’ll likely pay more for insurance.

Can any car modifications help lower my car insurance premiums?

While there are many types of modifications that can increase your insurance premiums, there are also several that could lower them. In some cases, this is only the case if your car is already modified. Keep in mind that they all still must be declared to your insurer. Here are some types of car modifications that may help lower your car insurance premium:

• Installing winter tires
• Installing anti-theft devices, like an ignition immobilizer
• Installing a dash camera
• Installing an aftermarket alarm system or GPS tracking device
• Installing parking sensors
• Downsizing your engine

Does modifying my car for accessibility affect my insurance?

Yes, it can. Most standard car insurance policies don’t cover aftermarket parts, so if you add accessibility modifications to your vehicle, you might need extra coverage like modified car insurance.

As we mentioned earlier, car modifications include anything that changes how your vehicle drives or looks, both inside and out. For accessibility, this could mean adding things like wheelchair lifts, hand controls, pedal extensions, and other adjustments to make the car easier to use.

Even accessibility modifications can affect how your insurance company values your car. It’s important to talk to your insurance advisor to ensure you have proper coverage. Remember, if you’re in an accident with a modified vehicle and didn’t inform your insurer, your claim could be denied, leaving you responsible for any costs.

Can my insurance deny my claim if I have modified my car?

Yes, as we've mentioned a few times now, your car insurance provider can refuse to pay a claim if you've made undeclared modifications to your car. But, as with most things in insurance, it depends.

Car insurance policies have a condition that requires you to notify your insurer about any material change—anything within your control that significantly affects your risk level. If you’ve made major modifications and didn’t inform your insurer, they could deny your claim or even cancel your coverage for failing to report those changes.

On top of that, each province has specific laws for vehicles that you must follow to drive legally. These rules cover things like the number and colour of lights on your car, safety features, and minimum maintenance standards. If your modification isn’t street legal, your insurance company could also refuse to pay a claim for that reason.

Do I need to tell my insurance company about every modification I make?

Yes, it’s important to let your insurance company know about any modifications, no matter how small they seem. Even minor changes can impact your coverage and premiums. If you don’t disclose them, you risk having claims denied or your policy cancelled.

What modifications are most likely to void my car insurance policy?

Any major modifications that change your car’s performance or safety—like big engine upgrades, suspension changes, brake system changes, or anything illegal—can void your car insurance policy. It's always a good idea to check with your insurance broker or provider before making any changes to make sure they’re covered.

Will my car insurance policy cover my car modifications?

Typically, insurance policies don't automatically cover any modifications you make to your car. This is because standard auto insurance usually only covers the original factory equipment. If you're making upgrades to your vehicle, you’ll likely need specialized insurance, often referred to as "modified car insurance."

Does car insurance cover engine replacement?

When it comes to engine repairs or replacement, it depends on the cause of the damage. Some situations might be covered by your collision coverage or comprehensive coverage, while others won’t. The best thing to do is reach out to your insurance provider or broker to clarify what’s included in your policy.

Protect your vehicles with BrokerLink

If you own a modified vehicle or are thinking about adding modifications to your ride, reach out to BrokerLink today. Our licensed insurance specialists can offer you expert advice about how your insurance may be affected by your car modifications and help ensure you have the right car insurance coverage to protect your vehicle should anything happen to it.

Remember, driving without insurance isn’t just a bad idea—it's illegal in Canada. There are several types of auto insurance available, and they apply to both regular and modified cars, including:

• Third-party liability coverage
• Accident benefits coverage
• Direct compensation - property damage coverage
• Uninsured automobile coverage
• Collision coverage
• Comprehensive coverage
• Accident forgiveness coverage

You can reach us by phone, email, or in person at any one of our locations throughout Canada. No matter how you choose to get in touch, a BrokerLink insurance advisor will be happy to assist you. We also encourage you to take advantage of our free online quote tool that can provide you with a competitive quote in minutes.

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