subject: Ordinary Car Owners Pay Less For Insurance - No Accessories Equals Car Insurance Discounts [print this page] In the world of pistons, panels and petrol, modifications equal sex appeal. You don't see music videos with beautiful women draped all over a stock-standard Holden Commodore that has just rolled off the factory floor. Unfortunately, though, the advertisers never indicate what it costs to insure those hotted-up rides. Probably because people nationwide would simply faint in front of their televisions! When it comes to modifications and car insurance, there are some insurers that will cut your premiums down if you haven't made any modifications to your car. Bikini babes might not be running up to you at the traffic lights - but owners of ordinary cars pay less for car insurance. We look at why.
What is a modified car?
Most car insurers interpret the term 'modification' in a fairly strict sense, to include any change to the car that leaves it in different condition than the factory specifications. So, modifications to your car that could affect your insurance premium may include:
Body modifications like spoilers, skirts or scoops
Engine modifications to increase torque or horsepower
Handling modifications like using stiffer than indicated springs, lowering the ride height, etc.
Using an aftermarket part rather than a factory-specified part.
If you have a relatively new car, however, and take your car to a dealer-approved mechanic for servicing and repairs, you are unlikely to have any of these modifications on your car. But why does that reduce your insurance premium?
Car modifications and insurance premiums
When car modifications change the properties of mechanical components (for example, giving your car more power, changing the handling, etc), there usually has not been a safety evaluation done on the new setup. Insurers and other parties don't have a reliable source of information about whether your car is more or less likely to be involved in a crash based on the modifications, and the only practical avenue is to assume that it is more likely to be involved in a crash. Of course, when you are more likely to be involved in a crash, your car insurance premiums go up to cover that risk.
The same is true of aftermarket parts or accessories - they may not be made by the original manufacturer and don't have an associated safety assessment, so this may well increase your chance of being involved in a crash.
Did you know ..
Not all car insurance companies actually ask you if your car is modified in any way. Some companies assume that most cars are modified (aftermarket parts are fairly common, after all), and put your premiums up to reflect that. When you come across a car insurance company that asks whether your car has been modified, you can be sure that if it hasn't, you'll be seeing lower premiums because of it.
If you have a new or unmodified car
There are quite a large number of drivers in Australia that have their cars serviced regularly and use factory-specified parts .. and most of them are paying more than they need to for their car insurance premiums! Look for a car insurance company that asks questions, rather than making assumptions about the state of your car if you want to pay less for your premiums, and spend more on what makes you happy.
by: Hugo Shreuder
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