Can you get car insurance for modified cars?
Yes, you can get car insurance for your modified car if all of its modifications are legal and comply with your state or territory’s regulations.
However, the car insurance products available will depend on the scope of your modifications:
- Modifications that require certification may be limited to a handful of car insurers.
- Minor modifications that don’t require certification could be covered with a general car insurance policy.
- Heavy modifications may be restricted to specialist modified car insurance products.
Read your policy documents or contact the provider directly for information on what modifications are included and excluded in any policy you’re considering.
What is a car modification?
Car modifications refer to any alterations or additions made to a vehicle after it has left the factory.
This includes any changes to the vehicle’s appearance, features, engine, height, suspension or fuel tank.
Modifying your vehicle can be a fun way to stylise your car or improve its performance.
However, your mods could affect the cost and coverage of your insurance policy.
Specific examples include:
- Window tinting
- Custom paint
- Neon lights
- Wider tyres or alloy wheels
- A spoiler or rear wing
- A sunroof
- A roll bar
- Higher-performance brakes
- A new exhaust system
- A new or improved audio system
- Turbochargers or superchargers
- Sport seats.
Keep in mind that any significant car modification that could potentially affect safety requires an inspection and certification by an approved and licensed certifier.
For example, suspension modifications are usually considered significant car modifications for this reason.
It’s also important to make sure your modifications are legal before going ahead with them. For example, there are many restrictions on the use of aftermarket underbody neon lights.
Each state and territory has its own regulations and restrictions around what car modifications are legal or illegal.
What is the best car insurance for modified cars?
The best car insurance policy for you will ultimately depend on your personal needs and circumstances.
When looking for car insurance for modified cars, you may want to consider the following:
- A comprehensive car insurance policy will generally provide you with coverage if your car is damaged or written off in an accident or due to theft, fire or a weather event.
- Specialist modified car insurance providers may provide features and services that a general car insurance provider would not.
- Optional extras, such as windscreen replacement, rental car usage and roadside assistance, may be worth considering, keeping in mind you’ll likely pay extra.
- If you’ve made costly modifications to your car, an agreed value policy that includes these mods may provide more coverage if you need to make a claim. However, premiums are generally higher under agreed value policies.
Are modified cars more expensive to insure?
Yes, modified cars are often more expensive to insure, resulting in higher premiums.
Modifications and accessories can add to a vehicle’s overall value, and may increase the cost to repair or replace your car if a claim is made.
Any increases to your car insurance premiums may depend on both the insurer you choose and the modifications you make.
You generally stand a better chance of getting a more affordable insurance quote if your car has been professionally modified, rather than doing it yourself.
The value of modifications and car accessories may also be calculated into either the vehicle’s agreed value or market value:
- Market value means the policy will cover you for what your vehicle would sell for on the market at the time of the claim. This is subject to depreciation in your car’s value from when you take out the policy to the time of the claim.
- Agreed value involves you and your provider agreeing on how much the car is worth. Agreed value provides more certainty about what compensation you will receive if your car is written off.
Setting an agreed value on your policy that includes your car’s modifications could be beneficial, as if you need to make a claim, you’re more likely to be covered for more than the car’s market value.
That said, premiums for agreed value policies are typically higher than those for market value policies.
Since car insurance for modified cars is typically more expensive, it can be worthwhile to shop around and compare different insurance policies to find one that’s right for you.
Remember to read the fine print for any policy you are considering, and contact a provider directly if you have any questions.
Vehicle modifications for people with a disability
Vehicle modifications may be necessary to support a person with a disability for functional and practical reasons.
These can include assistive technology that helps a person to drive safely, as well as to store mobility aids.
Funding may be available through the National Disability Insurance Scheme (NDIS) to help cover some costs involved with modifying your vehicle.
If you have a spinal cord injury it's often recommended to first contact an Occupational Therapist for an assessment for relevant recommendations about vehicle modifications. Specialist disability car insurance may also be available.
Should you tell an insurance provider if you modify a car?
Yes, you should tell your insurance provider before modifying a car.
Your insurer may limit what modifications are covered under a policy, even if the changes are legally permitted. If you make illegal car modifications, it could void your car insurance policy entirely.
Your provider will be able to let you know if the modifications will be covered by your current policy or if you will have to change your cover. They should also be able to give you an idea of potential premium changes that could apply.
If you already have car insurance, consider discussing the modifications you are thinking about with your provider before you make them.
Not informing your provider of a modification, even if it’s minor, could potentially affect the approval chances of any claims you make.
Rules and regulations around vehicle modifications in Australia
In line with Australian Design Rules and Australian Light Vehicle Standards Rules, each state and territory in Australia applies its own Vehicle Standards Rules for vehicle owners to comply with.
There are also usually restrictions for young drivers with a provisional or probationary licence.
For example, in some states P-platers are banned from driving certain high-powered or high-performance cars.
With car insurance costs typically already high for young drivers, providers may also outright deny coverage for under 25s looking to insure their modified vehicles.
What car modifications are legal and illegal?
Legal car modifications
What’s considered a minor or a basic modification will differ depending on your state or territory.
A general list of legal modifications can include:
- Sound systems
- Air-conditioning systems
- Sport seats
- Tinted windows
- Sunroofs
- Bull and/or towbars
- Custom paint jobs
- Alloy wheels, wider tyres and mud flaps and pebble guards
- Roof racks
- Spoilers.
There will be exceptions to this list due to state and territory-based restrictions.
Illegal car modifications
Common, potentially illegal car modifications may include:
- Exhaust systems exceeding set legal noise limits
- Tinted windows that are darker than what is legally permitted in your state or territory
- Non-compliant modifications to the engine
- Lowered vehicles where the body doesn’t pass the acceptable level of ground clearance (at least 100mm as stated in the Australian Design Rules)
- Underbody neon lights
- Tyre replacements that don’t comply with the car maker’s minimum load carrying capacity specifications
- Changing the seat belts to harness belts
- Unapproved or non-compliant modifications to increase payload or towing capacity.
What happens if you modify your car illegally?
If your car modification is illegal, you could be issued significant fines or your vehicle could be deregistered or even impounded. You could also receive a defect notice from the transport department or police if your vehicle is found to be defective. This would require you to have the vehicle repaired or altered to make it safe and legal to drive.
If an insurance provider is made aware of illegal modifications, your policy will likely be cancelled. You may also be denied coverage if you apply for modified car insurance for a vehicle that’s illegally modified.
How can you check if a car modification is legal?
Contact your relevant state or territory transport department for more details to find out if a car modification is legal. It may be worthwhile to email your queries to obtain written confirmation on what’s required for a modification you’re planning.
