Thread: Insurance Law regarding declaration of modifications

If car modifications are declared, is the insurance company allowed to add weight to the premium even if the modifications will only be used/effective on a private track but not while on public roads? Or is it even permissible/arguable not to declare the modifications as they will not be used in public?

i.e. An exhaust cut-out that works off a switch. When closed, the car is street legal and it will not increase the engine's power output. Yet on a private track it can be opened to allow more power.

Hey there,

I wrote a decent response but the site decided to crash lol...so here i go again :S

Anyway; All modifications to a vehicle must be declared on an insurance policy, failure to do so could result in your policy becoming void due to non disclosure of modifications/pre disposed conditions (Eg: a crash/accident)

Although you say the modifications are only used on a track the majority of insurers will only take into consideration what the vehicle was originally "built" for; so if it was a vehicle to serve for use on "public" roads this will be a major factor in the insurance policy and any modifications made after that point are additions by you. Basically the vehicle is still a "public" road vehicle.

If you didnt disclose, or even if you did...the insurers can always find some other "clause" to increase your policy cost...im certain you know that and of course legally it is not allowed, but these companies have lots of legal babble and lawyers who can "twist" things to their favour so a case against them would be long and painful. Again some others in the forum will say "Thats wrong, of course they cant do that" and in an ideal world that is 100% true...but we are A: Not in an ideal world and B: we just have to look at the state of our banks for validation of that.

In saying that "some" firms would be willing to take documents, professional expert opinions based on the information you provide to state whether any of the modifcations could and would be likely to be used on "public" roads. You will know better if the track area has registered proffessional experts. Again im certain most companies are not under legal obligation to do this as far as im aware, to an extent yes...but you get my point.

With regards to the exhaust cut-out based on a switch (Im assuming it is already installed). Seems perfectly legitimate and you said it does not increase the power of the vehicle; therefore personally i'd see no reason why they would hike your policy cost on that basis.

I have had insurance refused before because they decided I was negligent (it was stolen) yet I complained to the Ombudsman, proved my case and finally got compensation. But where are the rules such judgements are based on? Surely, it cannot be up to the insurers to decide as they have a vested interest in not paying out.

Originally Posted by jansus

I agree with the post by vindicated you must declare all modifications and when they will be used.

While this may be the case of an insurers T&C's, I do wonder if that's just a case of them having their cake and eat it. I've been asked if I'm a smoker by one insurance company - seems they can pick and chose what can be weighted - what about wearing make-up, using mobiles, eating even? I wasn't asked about those. (Not that I do wear make up or brush my hair in the rear view mirror ). How far can they push it? They should be better regulated IMO.

Originally Posted by jansus

The insurance company will use purely mathmetical risk assesments as to how to load your premium - the fact is although you say you will only use on the track you could use the modifications on the road if you chose to - for whatever reason.

I haven't inferred differently. Yes, I could use the mods on the road but as stated above, being illegal, I certainly wouldn't expect to be insured if I do. There should be more transparency about what and how risks are calculated IMO.

Originally Posted by jansus

If you dont like the premium try another company - I guess there must be companies that specialise on vechicles that are used on tracks.

The processes put in place make this searching a very tedious and timewasting exercise as you practically have to hunt through them blindly - why can't they publish the info we need to make our choices - the risks and their weightings? With the new insurance premium tax, the treasury won't be in a hurry to curb this.

As you advise the system is set on a switch so there is nothing stopping you from using on the road is you so wished.

You may not be willing to accept the loading the insurer applies for the modifications at quotation stage however, what would you do retro-spectively given the following scenario:

A friend of mine had a car accident (quite a serious one) in which three of his passengers were injured as well as damaging two other motor vehicles and a central reservation. The insurers handled and settled the claim to the tune of £45,000, it was then discovered that the car was modified (albeit track modifications only ie. rollcage, cut off switch etc) therefore breaching T&C's of his insurance contract. They then sued him to reclaim their outlay, unfortunately this lead to him having to sell his house!

Originally Posted by MrMT

If car modifications are declared, is the insurance company allowed to add weight to the premium even if the modifications will only be used/effective on a private track but not while on public roads? Or is it even permissible/arguable not to declare the modifications as they will not be used in public?

i.e. An exhaust cut-out that works off a switch. When closed, the car is street legal and it will not increase the engine's power output. Yet on a private track it can be opened to allow more power.

The answer to your question is YES, the Insurance Company is allowed to add weight to the premiums, or even decline to insure the car.

As others have said it is a condition of your policy that all modifications are disclosed, regardless of how or when they will be used.

Mossy