‏‏ Customized Car Insurance – Forbes Advisor UK - Mobilyardim

Customized Car Insurance – Forbes Advisor UK

Modifying a vehicle to make it faster or safer will have an effect on the auto insurance premiums it attracts. But how exactly does it work? Here you will find everything you need to know about custom car insurance.

Premiums and risk

The price you pay for auto insurance reflects the likelihood of making a claim. For example, if you live in an area with a higher-than-average crime rate or park your car on the street and not in a driveway, it will likely drive up your quoted premiums.

Likewise, if you’re driving an expensive and powerful car, you’ll probably pay more for coverage than you would if you were insuring a “sightseeing flight” with a small engine.

In other words, the more likely you are to cost your insurer by filing a claim — and the more likely you are to pay for repair or replacement — the more insurance premiums you’ll charge to cover the additional risk.

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How changes affect premiums

But whether making changes to your vehicle increases or decreases the risk of an insurance claim depends on what those changes are.

For example, aftermarket security systems such as electronic immobilizers or car alarms make it more difficult to steal a vehicle. Because it reduces the risk of you filing a claim for theft, insurers can offer cheaper coverage in return.

On the other hand, mechanical modifications, such as replacing your vehicle’s drivetrain (which powers the wheels), will increase acceleration or top speeds. Since you are now driving a more powerful car, this could bump you up against a higher insurance group, driving premiums up as well.

Even cosmetic changes such as tinted windows, alloy wheels or vinyl wraps can have an effect on your insurance policy as they can make your vehicle more attractive to thieves.

Changes that facilitate access for disabled drivers or passengers, such as tail lifts, ramps and electronic accelerators, also count as changes that could affect the cost of your coverage and, like all changes, should be reported to your insurer.

Inform your insurer

Whether you are buying a car that has been modified or making changes to a vehicle you already own, you should inform your insurer about what has been done to the vehicle.

Buying insurance is an agreement based on good faith. The insurer promises to pay claims, if applicable, as long as you have provided complete and accurate information about yourself and your vehicle.

If you were to make a claim without disclosing changes to your vehicle, the insurer could reasonably reject your claim on the grounds that you were not honest in your application. In that case, you will have to pay for repairs or replacements out of pocket.

It is best to talk to your insurance company before making any changes to find out if your existing policy will cover the changes or if you need to extend your coverage.

Some modifications, such as colored lights under the body, may be illegal to fit in your car. If your insurer refuses to cover your changes, it also reserves the right to cancel your policy if you go ahead. Canceling a policy can make it more difficult to find affordable coverage in the future.

Some changes must be declared to the Driver and Vehicle Licensing Agency (DVLA) by updating Section 7 of your vehicle’s V5 document – which you should have received when you purchased the vehicle.

The kinds of changes the DVLA would be interested in are things like changing your car’s color, displacement (CC), or fuel type, for example converting it to liquefied petroleum gas (LPG).

To keep the costs low

If you are committed to your vehicle’s modifications and understand that this could mean paying more for coverage, there are other ways to keep your costs down.

The first port of call is a price comparison service to find out which insurers offer the best price for the coverage you need. Insurers have just been banned from offering new customers a lower premium than existing customers for the same coverage, so they can no longer use that tactic to compete with other insurers.

As a result, insurers may need to make their overall pricing more competitive if they want to increase their market share, and you can take advantage of this.

If you’re driving less because Covid restrictions mean you’ll be working from home full-time or part-time, remember that your annual mileage will likely be lower than usual — and it could save you money.

If you can, it’s cheaper to pay your premium for the year up front rather than in monthly installments because there’s no interest to pay.

Increasing the amount you’re willing to pay to the voluntary deductible to make a claim can also lower your premium. Make sure that you are prepared to pay this on top of your mandatory deductible.

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Choose from different policies for affordable coverage that suits you and your car.

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