Obtaining insurance for modified cars in Canada might be more challenging for a consumer than seeking coverage for a vehicle in its original factory form. Although modified cars are popular with many Canadians, many of these individuals with customized automobiles often lack the proper insurance coverage they require.
The most fundamental aspect to obtaining proper insurance coverage for a modified car is listing the precise nature of the changes and alterations that have been made to the vehicle. A person cannot simply submit an application for a modified car that makes note of the make, model and year. Rather, detailed information about all changes to the vehicle and all new parts must be fully disclosed.
Canadian car insurance companies may assume a greater insurable risk with a modified car. If the insurance company has not been notified that a car has been modified and this is not part of the insurance coverage, a consumer runs the risk of having a claim denied, possibly in its entirety.
In Canada, the reality is that even common and seemingly minor modifications are of concern to automobile insurance companies. For example, Canadian insurance companies have denied claims or even cancelled automobile insurance policies because the insured vehicle was modified by the addition of minimally different rims or tire sizes without proper disclosure.
The typical consumer may think this type of minimal change to a vehicle is no big deal. Nonetheless, in the eyes of most Canadian insurance carriers, it is an alteration significant enough to result in a claim denial or even policy cancellation.
Also, while not commonplace, a person who makes significant modifications to a vehicle and fails to advise his or her insurance company of these alterations faces the prospect of a criminal charge for fraud. This is a potential outcome for owners of modified cars involved in significant accidents, who attempt to obscure or conceal the modifications from a claims adjuster.
Owners of modified cars in Canada will be able to find the type and extent of automobile insurance coverage they require. All it takes is a reasonable amount of research and making the insurance company fully aware of all changes that you've made to the modified car.