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J.J. Starr is an insurance and personal finance expert who has been writing for Compare.com since 2022. Her work has been published across the web, appearing on sites such as Insurify.
Prior to writing for Compare.com, J.J. was a registered banker and life insurance consultant, holding a Series 6, FINRA, and life insurance license. She also earned a master’s degree in writing from New York University.
J.J. has a passion for helping people save money by explaining complex topics like car insurance in a way that is simple and easy to understand.
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10+ years writing and editing insurance content
Published in Washington Post, LA Times, and more
Nick leads Compare.com's editorial team in creating helpful, easy-to-understand content about insurance and personal finance.
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Licensed property and casualty insurance agent
5+ years editing insurance content
NPN: 20564519
A seasoned editor, insurance author, and licensed agent, Katie is an expert reviewer fact-checking Compare.com articles.
Updated
Modified car insurance helps pay to repair or replace eligible customizations and modifications after a covered loss.
Standard auto insurance policies typically offer limited or no coverage for vehicle modifications, so customizations or upgrades typically require additional coverage.
Policy endorsements, such as custom parts and equipment (CPE), extend coverage for modifications at an additional cost.
Car insurance can cover modifications and upgrades to your vehicle, but you’ll likely need to purchase additional coverage. If you’ve modified your car without updating your insurer, it’s unlikely your current policy will cover those modifications.
Before upgrading your car, talk to your insurance agent about what you want to modify and how it will change your coverage needs. If your car already has upgrades, report those to your insurer.
A modified car has customizations to its original factory specifications and parts. This could include big upgrades like custom paint jobs, engine swaps, or modified suspension or wheels. But insurers typically consider any deviation from the car’s original parts to be a mod. That said, what counts as a modification may change somewhat depending on the insurer.
Specialized modified-car insurance covers the repair or replacement of aftermarket parts, upgrades, or other customizations following an accident or other damage. That includes:
Performance modifications, including engine upgrades, turbochargers, superchargers, and custom exhaust systems
Appearance changes such as custom paint, body kits, spoilers, window tint, and specialty wheels
Interior changes like custom audio systems, upholstery, and seats
Suspension and structural upgrades, including lift kits, leveling kits, coilovers, upgraded springs or struts, and roll cages or roll bars
Accessibility features such as wheelchair lifts and other modifications
What your policy covers depends on your insurer and the exact wording of your policy. And remember, policies cover you only up to your coverage limit, minus the deductible. So even if you have coverage for some or all of your mods, make sure you have high enough limits to include them.
Modified car insurance policies typically don’t cover things like:
Illegal or risky modifications: Insurers may decline to insure high-risk or illegal upgrades due to increased risk, safety concerns, or potential legal issues.
Unattached equipment: Policies usually don’t cover modifications not permanently attached to the vehicle, such as specialized tools or other parts. But some endorsements cover spare parts.[1]
Commercial use: Insurers cover business vehicles differently, so a standard auto insurance policy won’t pay for modifications for business purposes. In fact, you won’t have any coverage while you use your vehicle for business purposes. Instead, you’ll need a specialized commercial auto insurance policy to ensure proper coverage at all times.
Maintenance and breakdowns: Insurers rarely cover normal wear and tear or breakdowns caused by failing to maintain your vehicle, unless you have special endorsements.
Review your policy and compare quotes from insurers best suited to your needs.
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A standard car insurance policy assumes that your vehicle holds standard market value and will reimburse you up to that amount when you purchase comprehensive and collision coverage. But upgrades and modifications can cause your car’s value to go up or down.
Here’s an overview of how a standard policy compares to one with coverage for modified cars.
Key Differences | Standard Coverage | Modified Car Coverage |
|---|---|---|
| Coverage for modifications | May exclude upgrades or provide limited protection | Extends protection to approved modifications |
| Claim payout | May not reflect the full value of your vehicle enhancements | Includes covered modifications, but still subject to coverage limits and deductibles |
| Availability | Virtually all auto insurers operating in your state offer a standard policy | Some insurers offer endorsements, but not all |
| Cost | No additional charges | Endorsements typically add to your monthly premium |
Typically, you add endorsements that modify a standard policy and extend coverage to customized parts and other upgrades. But a stand-alone, specialized policy may be a better fit depending on the vehicle, its mods, and how you use it.
You have several options for insuring your modified car depending on the vehicle and the modifications you’ve made. Many policyholders use endorsements, specialty coverage, classic car insurance, or a mix of methods to cover their modified cars.
Here’s an overview of each, along with when they’re most appropriate.
The CPE coverage endorsement covers eligible equipment for certain types of damage up to the limits specified in your policy. But it covers only the custom parts outlined in your policy, not parts from the original manufacturer (you need collision and comprehensive coverage for that).
This type of coverage endorsement is best suited to drivers who upgrade their vehicles with expensive or hard-to-replace custom parts that may exceed the coverage limits of a typical policy.
With agreed value coverage, you and your insurer agree on your vehicle’s value before you sign your policy documents. The insurance company then writes the value into the policy.
These types of policies are most appropriate for cars valued above their original purchase price. This endorsement ensures your insurer will fully compensate you for your loss if you total your vehicle.
Classic or collector car insurance covers unique, vintage, or rare vehicles. Generally, you can’t use these cars as your primary vehicle and must provide a private, often covered, parking space.
You must also meet state-specific requirements, which often include maintaining a fairly clean driving record, such as having no major violations like a driving under the influence (DUI) conviction or reckless driving.
Ensure your policy covers every mod and use by comparing quotes today.
Adding endorsements or specialty coverage to protect modifications you’ve made to your vehicle can affect your car insurance, but it depends on the modification. Expensive upgrades can increase your repair and replacement costs, which, in turn, increases your premiums.
Changes that make your engine more powerful can also increase your car insurance rates, as more powerful engines correlate with higher rates of speeding, a leading cause of car accidents.[2] [3]
On the other hand, installing an anti-theft device can earn you a discount with many insurance companies, including Auto-Owners, State Farm, and Nationwide. Other installed safety features can also earn you a discount, depending on the device and the insurer.
Expert’s insight
“You probably take a lot of pride in your vehicle and its modifications, so the last thing you want is to be left without coverage if you have to file a claim. Typically, a CPE endorsement adds a relatively modest amount to your monthly premium, and it ensures you have coverage for every part of your vehicle, regardless of whether they came from the factory or you added them yourself.”
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If you don’t tell your insurance company about modifications to your vehicle, it’s unlikely to cover those mods after an accident. And in some cases, insurers may argue that functional modifications (such as suspension or drivetrain mods) caused the accident, resulting in a costly claim denial. Disclosing upgrades to your vehicle helps your insurer properly assess your car’s value and determine if you need additional coverage.
Talking to your insurer before modifying your car can also help you understand how it will affect your policy, premiums, and overall coverage.
Modified car insurance typically involves adding endorsements to a full-coverage policy. Full coverage adds collision and comprehensive coverage to your liability insurance, and specialized endorsements extend those coverages to the specified modifications listed in the endorsement.
The value of your modifications, which determines the coverage limits needed, also affects your premiums. Generally, the higher the coverage limit, the higher the premium. Insurers will list the cost of your endorsement as a line item in your quote, so you’ll be able to see exactly what it costs.
The process of adding coverage for vehicle modifications can vary by insurance company. But it typically involves the following steps.
Document what changed. List each modification you’ve made, include receipts, and photograph the installed parts.
Determine suitable coverage. Review general coverage options and select the best fit for you, such as full coverage with a CPE endorsement.
Compare insurance companies. Gather quotes from multiple insurers, and be sure to disclose modifications and add necessary coverage options to your quotes.
Confirm policy details. Review policy documents to verify that they include your desired coverage options and limits.
Purchase the policy. Buy your policy, put your new proof of insurance hard copy in your car, and add your insurer’s customer service line to your phone.
Comparing customized quotes is far easier than customizing your car.
The answers below address the most common questions drivers with modified vehicles ask about getting proper coverage.
It’s a good idea to tell your insurer about any modifications you’ve made to your vehicle, as some may void the contract or require special coverage if they learn about mods during a claim. You can also speak with your insurer before investing in modifications to see exactly how they might affect your policy costs and coverage.
It depends. Modifying your car can void its insurance if it affects the vehicle’s safety or changes its overall insurability. And failing to inform your insurer about the modification can lead to a denied insurance claim or canceled policy if it discovers your mods after the fact.
It depends. The right insurance hinges on the types of modifications and vehicle. Custom parts and equipment coverage works well for standard upgrades. But agreed value is often better for highly customized vehicles, and classic car coverage is best for antiques and collector vehicles.
Yes. You can get modified car insurance for a leased vehicle, as long as the insurer approves coverage. You should also confirm with your lessor whether it permits modifications before making any.
Yes. Some modifications can lower insurance costs. Anti-theft systems, for example, can reduce comprehensive insurance premiums.
Data scientists at Compare.com analyzed more than 50 million real-time auto insurance quotes from more than 75 partner insurers in order to compile the rates and statistics seen in this article. Compare.com’s auto insurance data includes coverage analysis and details on drivers’ vehicles, driving records, insurance histories, and demographic information.
All the rates listed in this article have been collected from a combination of real Compare.com quotes and external insurance rate data gathered in collaboration with Quadrant Information Services. Compare.com uses these observations to provide readers with insights into how auto insurance companies determine their premiums.
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J.J. Starr is an insurance and personal finance expert who has been writing for Compare.com since 2022. Her work has been published across the web, appearing on sites such as Insurify.
Prior to writing for Compare.com, J.J. was a registered banker and life insurance consultant, holding a Series 6, FINRA, and life insurance license. She also earned a master’s degree in writing from New York University.
J.J. has a passion for helping people save money by explaining complex topics like car insurance in a way that is simple and easy to understand.
10+ years writing and editing insurance content
Published in Washington Post, LA Times, and more
Nick leads Compare.com's editorial team in creating helpful, easy-to-understand content about insurance and personal finance.
Licensed property and casualty insurance agent
5+ years editing insurance content
NPN: 20564519
A seasoned editor, insurance author, and licensed agent, Katie is an expert reviewer fact-checking Compare.com articles.
At Compare.com, it’s our mission to give you the tools to find the best (and most affordable) insurance for your unique needs and budget. We strive to provide information that’s helpful, clear, and unbiased, and we believe that comparing insurance companies should never put you at risk of spam. Our editorial team — which is made up of experienced writers, editors, insurance agents, and data analysts — has spent thousands of hours researching and creating the coverage overviews, side-by-side comparisons, and detailed reviews you see across our site.
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