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Posted: 12/15/2005 6:40:10 AM EDT
quote
It is another sad day in the custom vehicle industry. January 1 st of 2005 is a milestone for the insurance industry. We have had many calls and questions about, "what do I do now?" My custom car or truck is no longer insurable.

Yes it is true. AllState, Farm Bureau, State Farm, Geico and even Progressive insurance companies will no longer insure a modified vehicle.

Any motor or driveline modification that will increase performance or horsepower from the original manufacturers design will no longer be an insurable vehicle to be driven on the street

Any motor vehicle with a suspension modification to include a lift or lowering kit, sub frame, c-notch, frame modification or use of air or hydraulic suspension will no longer an insurable vehicle to be driven on the street.

This includes Street Rods, Muscle Cars, and Four Wheel drive trucks and SUV type vehicles.

This will not apply to an antique or collectable vehicle as long as it has been returned or restored to its original manufactured design.

This also includes companies that make these modifications. Many companies that make these modifications are not insured to do this. Companies that are not insured to do this may also be in violation of Federal laws for rendering a motor vehicle that was in service legally to no longer in service legally if it is still operated on the roads as modified.

Companies that would be permitted to make modifications for street use will be properly insured.

This would include a garage keeper liability and a product liability policy. Some larger companies are self insured through bonding.

Ask to see proof that the shop you are intending to use is insured and insured properly. If they are not and you are involved in an accident, it's you who will suffer.

Companies that are permitted to make the modifications will be regulated by the National Highway and Traffic Safety Administration. You can go to NHTSA web site and look up manufacturers who are recognized and regulated to make the necessary modification you seek.

Don't lie to the agent that your car is stock to get insurance coverage. Insurance is the law in many states. If you don't tell them the truth, you are going to go down a very rough road.

All State has taken the stance to notify all the states authorities that require insurance, other than no fault, if they stop a vehicle that is modified, or a modified vehicle that is involved in an accident, that the modified vehicle in not insured under any terms according to their policies.

end Quote


is it true that our modified vehicle are no longer legally coverd by our insurance policies?
Link Posted: 12/15/2005 6:46:27 AM EDT
Bigscrun had problems insuring his vehicle, too...

Link Posted: 12/15/2005 6:48:41 AM EDT
Call your insurance company to find out... then report back to us.
Link Posted: 12/15/2005 6:49:19 AM EDT
Link Posted: 12/15/2005 6:51:28 AM EDT
[Last Edit: 12/15/2005 6:51:48 AM EDT by timdog68]
Since the notice states as ofJan 1 2005 I think we would have heard of it by now since 2006 is almost hear.
BS
Link Posted: 12/15/2005 6:52:17 AM EDT
Link Posted: 12/15/2005 6:52:35 AM EDT
Lemme guess... you got this in an email?
Link Posted: 12/15/2005 6:56:34 AM EDT
Link Posted: 12/15/2005 8:09:12 AM EDT
so what you'er saying is that it is the co-insurance co that is able to refuse to take the hit but that the primary insurnance co is still responsible to cover the claims on modded vehicles?
Link Posted: 12/15/2005 8:24:10 AM EDT
info was quoted from here
Link Posted: 12/15/2005 8:36:41 AM EDT
Link Posted: 12/17/2005 6:10:12 AM EDT

Originally Posted By -brass-:

Originally Posted By JFP:
so what you'er saying is that it is the co-insurance co that is able to refuse to take the hit but that the primary insurnance co is still responsible to cover the claims on modded vehicles?



The co-insurance company only pays the insurance company if they can't cover a large number of claims in a short time (Katrina/NOLA for example). The co-insurance companies are Huge and basically "invisible", basically data-mining companies, risk calculation, etc. (my experience, had to learn all of this crap to work there). The co-insurance company never pays directly to the insured (car or homeowner), but to the insurance company holding the policy.

If the standard insurance company cannot show that it has enough in its fund to cover AVERAGE yearly payouts, they either need to get their premiums and policies in order, or pay a TON more for co-insurance ("hypthetically" talking $100,000/month here, vs $60,000/month [not real world, you would be afraid to see the actual numbers]). The only reason I mention co-insurance is they are actually "The Guys" that determine insurance rates nationwide.

Many insurance companies have the same "parent" company, and they show up in advertisements as "competitors", as far as those companies know, they are, but 2 levels up, the same Insurance co owns both of them. This is to seperate the "claim pool" and "risk eval" to manageable levels when mixing in multi-level risk insurance buyers, even though it is the same pool at the bank and stock market, the little companies only see their "virtual chunk" of it. The co-insurance guys sit on the sidelines of all of this and cover the insurance companies when a massive unforseen expense takes place. They base their rates on how flexible the insurance company is in self-absorbing their own small to medium "hits" (large lawsuits, hail damage to crops, floods, etc, it is ALL one fund, much of it "stored" in low-risk investments). Floods are what can knock a smaller "big"company out, as in the midwest, they would get hit on A) Home Insurance B) Totalled Cars from water damage C) Flooded crops D) Life. When that happens, they can't pull all of their money out of the low risk investments quickly, so the co-insurance company writes them a check and they pay the claims with that, in addition to any liquidable funds they have in their "pool".

For Clarification, I am posting this talking about the Big Picture, not from the tree/forest level, but more from the Tree Bark vs. Satellite Image level. As you go down the "levels" in the insurance company, when you get to the split between home/auto/car/life, each one of those "sections" needs to prove solvency for premiums vs. claims. I will snip this down to auto insurance only in my last paragraph:

Now that car insurance is required in all states, that has helped increase their "pool", but they keep track of EVERY facet of the insured, age, car type, modifications, even if the car has tape or CD, alarm, etc. If it is in the top 100 stolen list, premium for full coverage goes up, period. If you are under 25, premiums go up. If you have modifications to it, premiums go up. If you do not tell the insurance company you have modifications, they will cancel your policy upon a claim, letting you eat the entire balance (look at the fine print). The previous sentence is what this entire thread is about! So if you are under 25, have 1 DUI, and a Tricked out EVO (which you probably let friends "Try Out the power"...), you are essentially an insurance nightmare, pegging at 80%-100% chance of totalled in an accident (pay for your car and medical/repairs on the guy that was hit) or stolen within a year. Since states require ins. to be provided to everybody, they have to sell it to you, so if you are getting full coverage, you will probably have premiums that are close or greater than your car payments.



Red highlight is not true, I talked to my rep and they are still obligated to cover everything but the mods. They will cover the mods provided you have photographic evidence and/or reciepts as well as an appraisal. You will pay aslightly higher premium due to teh increased value of the vehicle but that is all...
Link Posted: 12/17/2005 6:21:28 AM EDT
B.S.
Link Posted: 12/17/2005 6:34:37 AM EDT

Originally Posted By JFP:

Originally Posted By -brass-:

Originally Posted By JFP:
so what you'er saying is that it is the co-insurance co that is able to refuse to take the hit but that the primary insurnance co is still responsible to cover the claims on modded vehicles?



Now that car insurance is required in all states, that has helped increase their "pool", but they keep track of EVERY facet of the insured, age, car type, modifications, even if the car has tape or CD, alarm, etc. If it is in the top 100 stolen list, premium for full coverage goes up, period. If you are under 25, premiums go up. If you have modifications to it, premiums go up. If you do not tell the insurance company you have modifications, they will cancel your policy upon a claim, letting you eat the entire balance (look at the fine print). The previous sentence is what this entire thread is about! So if you are under 25, have 1 DUI, and a Tricked out EVO (which you probably let friends "Try Out the power"...), you are essentially an insurance nightmare, pegging at 80%-100% chance of totalled in an accident (pay for your car and medical/repairs on the guy that was hit) or stolen within a year. Since states require ins. to be provided to everybody, they have to sell it to you, so if you are getting full coverage, you will probably have premiums that are close or greater than your car payments.



Red highlight is not true, I talked to my rep and they are still obligated to cover everything but the mods. They will cover the mods provided you have photographic evidence and/or reciepts as well as an appraisal. You will pay aslightly higher premium due to teh increased value of the vehicle but that is all...



No offense JFP, but you come here asking 'Is this true?' demonstrating that your knowledge in this are is already on thin ice, but then you tell -brass- he's wrong. FYI, an insurance company can do whatever the hell they want to do. I see a lot of patients who have to sue their insurance company because they refuse to pay a legitimate claim. They are not parting with 'their' money without a fight.
Link Posted: 12/17/2005 6:51:22 AM EDT
Link Posted: 12/17/2005 7:44:13 AM EDT

Originally Posted By C-4:

Originally Posted By JFP:

Originally Posted By -brass-:

Originally Posted By JFP:
so what you'er saying is that it is the co-insurance co that is able to refuse to take the hit but that the primary insurnance co is still responsible to cover the claims on modded vehicles?



Now that car insurance is required in all states, that has helped increase their "pool", but they keep track of EVERY facet of the insured, age, car type, modifications, even if the car has tape or CD, alarm, etc. If it is in the top 100 stolen list, premium for full coverage goes up, period. If you are under 25, premiums go up. If you have modifications to it, premiums go up. If you do not tell the insurance company you have modifications, they will cancel your policy upon a claim, letting you eat the entire balance (look at the fine print). The previous sentence is what this entire thread is about! So if you are under 25, have 1 DUI, and a Tricked out EVO (which you probably let friends "Try Out the power"...), you are essentially an insurance nightmare, pegging at 80%-100% chance of totalled in an accident (pay for your car and medical/repairs on the guy that was hit) or stolen within a year. Since states require ins. to be provided to everybody, they have to sell it to you, so if you are getting full coverage, you will probably have premiums that are close or greater than your car payments.



Red highlight is not true, I talked to my rep and they are still obligated to cover everything but the mods. They will cover the mods provided you have photographic evidence and/or reciepts as well as an appraisal. You will pay aslightly higher premium due to teh increased value of the vehicle but that is all...



No offense JFP, but you come here asking 'Is this true?' demonstrating that your knowledge in this are is already on thin ice, but then you tell -brass- he's wrong. FYI, an insurance company can do whatever the hell they want to do. I see a lot of patients who have to sue their insurance company because they refuse to pay a legitimate claim. They are not parting with 'their' money without a fight.



c4, as you can see I did a little research since I asked the original Q
Link Posted: 12/17/2005 7:47:01 AM EDT

Originally Posted By The_Beer_Slayer:
for a standard policy yes that is true.

my uncle finished his old roadster last year and had a hell of a time getting it insured.

he was told the problem comes from improperly modified suspensions that may fail or adversly affect vehicle handling resulting in a higher probability of a crash/injury. That along witht he higher repair costs of a "custom" or one up vehicle. He was able to get it insured but as i recall he said it required a seperate policy for custom addons like wheels and stuff, and much higher premium.



basically What I said after talking with my agent, it just depends on how much value is added to the vehicle
Link Posted: 12/17/2005 8:00:55 AM EDT
Link Posted: 12/17/2005 8:14:38 AM EDT
[Last Edit: 12/17/2005 8:19:56 AM EDT by SigSaurP228]

Originally Posted By JFP:
quote
It is another sad day in the custom vehicle industry. January 1 st of 2005 is a milestone for the insurance industry. We have had many calls and questions about, "what do I do now?" My custom car or truck is no longer insurable.

Yes it is true. AllState, Farm Bureau, State Farm, Geico and even Progressive insurance companies will no longer insure a modified vehicle.

Any motor or driveline modification that will increase performance or horsepower from the original manufacturers design will no longer be an insurable vehicle to be driven on the street

Any motor vehicle with a suspension modification to include a lift or lowering kit, sub frame, c-notch, frame modification or use of air or hydraulic suspension will no longer an insurable vehicle to be driven on the street.

This includes Street Rods, Muscle Cars, and Four Wheel drive trucks and SUV type vehicles.

This will not apply to an antique or collectable vehicle as long as it has been returned or restored to its original manufactured design.

This also includes companies that make these modifications. Many companies that make these modifications are not insured to do this. Companies that are not insured to do this may also be in violation of Federal laws for rendering a motor vehicle that was in service legally to no longer in service legally if it is still operated on the roads as modified.

Companies that would be permitted to make modifications for street use will be properly insured.

This would include a garage keeper liability and a product liability policy. Some larger companies are self insured through bonding.

Ask to see proof that the shop you are intending to use is insured and insured properly. If they are not and you are involved in an accident, it's you who will suffer.

Companies that are permitted to make the modifications will be regulated by the National Highway and Traffic Safety Administration. You can go to NHTSA web site and look up manufacturers who are recognized and regulated to make the necessary modification you seek.

Don't lie to the agent that your car is stock to get insurance coverage. Insurance is the law in many states. If you don't tell them the truth, you are going to go down a very rough road.

All State has taken the stance to notify all the states authorities that require insurance, other than no fault, if they stop a vehicle that is modified, or a modified vehicle that is involved in an accident, that the modified vehicle in not insured under any terms according to their policies.

end Quote


is it true that our modified vehicle are no longer legally coverd by our insurance policies?




Yes and no, you must insure your vehicle properly, no vehicle that has been modified to increase performance has ever been covered. It is something your agent has always been required to ask you (allthough many don't unless they have reason to believe that you have modified it). Odds are if you are in an accident then your company will settle the loss pay you for your Stock vehicle and ignore the modifications.


ETA and then drop you as well.
Link Posted: 12/17/2005 8:19:16 AM EDT

Originally Posted By The_Beer_Slayer:
for a standard policy yes that is true.

my uncle finished his old roadster last year and had a hell of a time getting it insured.

he was told the problem comes from improperly modified suspensions that may fail or adversly affect vehicle handling resulting in a higher probability of a crash/injury. That along witht he higher repair costs of a "custom" or one up vehicle. He was able to get it insured but as i recall he said it required a seperate policy for custom addons like wheels and stuff, and much higher premium.




Mike,

Does your uncle use the car as a daily driver and is it kept in a garage? Alot of companies offer policies specifically designed for your uncle's situation. He should look up and call these two companies.

Foremost, and ACE, as well as Safeco. (Safeco is a little more expensive but not quite as hardline on their underwriting guidlines) Hope this helps.
Link Posted: 12/17/2005 8:26:23 AM EDT
[Last Edit: 12/17/2005 8:30:13 AM EDT by -brass-]
Link Posted: 12/17/2005 11:43:03 AM EDT

Originally Posted By SigSaurP228:

Originally Posted By JFP:
quote
It is another sad day in the custom vehicle industry. January 1 st of 2005 is a milestone for the insurance industry. We have had many calls and questions about, "what do I do now?" My custom car or truck is no longer insurable.

Yes it is true. AllState, Farm Bureau, State Farm, Geico and even Progressive insurance companies will no longer insure a modified vehicle.

Any motor or driveline modification that will increase performance or horsepower from the original manufacturers design will no longer be an insurable vehicle to be driven on the street

Any motor vehicle with a suspension modification to include a lift or lowering kit, sub frame, c-notch, frame modification or use of air or hydraulic suspension will no longer an insurable vehicle to be driven on the street.

This includes Street Rods, Muscle Cars, and Four Wheel drive trucks and SUV type vehicles.

This will not apply to an antique or collectable vehicle as long as it has been returned or restored to its original manufactured design.

This also includes companies that make these modifications. Many companies that make these modifications are not insured to do this. Companies that are not insured to do this may also be in violation of Federal laws for rendering a motor vehicle that was in service legally to no longer in service legally if it is still operated on the roads as modified.

Companies that would be permitted to make modifications for street use will be properly insured.

This would include a garage keeper liability and a product liability policy. Some larger companies are self insured through bonding.

Ask to see proof that the shop you are intending to use is insured and insured properly. If they are not and you are involved in an accident, it's you who will suffer.

Companies that are permitted to make the modifications will be regulated by the National Highway and Traffic Safety Administration. You can go to NHTSA web site and look up manufacturers who are recognized and regulated to make the necessary modification you seek.

Don't lie to the agent that your car is stock to get insurance coverage. Insurance is the law in many states. If you don't tell them the truth, you are going to go down a very rough road.

All State has taken the stance to notify all the states authorities that require insurance, other than no fault, if they stop a vehicle that is modified, or a modified vehicle that is involved in an accident, that the modified vehicle in not insured under any terms according to their policies.

end Quote


is it true that our modified vehicle are no longer legally coverd by our insurance policies?




Yes and no, you must insure your vehicle properly, no vehicle that has been modified to increase performance has ever been covered. It is something your agent has always been required to ask you (allthough many don't unless they have reason to believe that you have modified it). Odds are if you are in an accident then your company will settle the loss pay you for your Stock vehicle and ignore the modifications.


ETA and then drop you as well.


I asked the agent this specific q and they said that if it increased the value of the vehicle it could be covered. They specifically said that performance mods were not considered in determining a higher risk resulting in higher premiums or rejection of coverage
Link Posted: 12/17/2005 12:06:00 PM EDT
Link Posted: 12/17/2005 1:21:27 PM EDT
I am looking to do some basic performance mods to my '71 Cutlass such as alum heads, roller cam, gears and posi with rear disc's, tubular A arms and control arms ect. My State Farm agent stated specifically that it would not prohibit them from covering the car. Now if I were to get into an accident and the lawyers get involved its anyones guess what will happen but they did say that simply installing the mods was not grounds for denying coverage..
Link Posted: 12/17/2005 1:36:29 PM EDT
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