Insurance and Modifications

[alanr]

My +2S130 is insured with Lancaster Classic Car Insurance .

At renewal time back in June I thought it best to tell them that i was in the process of fitting a 5speed gearbox. The guy said he thought that was a minor change of specification and no more was said. The renewal was done and premium paid.

Yesterday some 5months later I received an email from them saying having now fitted a 5speed gearbox this constituted a 'Modification' and the underwriters had decided that an additional premium was due... of ...wait for it..£2.24 ..Yes, Two pounds and twenty four pence. This made me laugh!
However the email then followed on to say that failure to pay this within 7days would result in cancellation of the policy with no refund of any past premiums paid!
So, I have just called them up and paid this 'additional premium' and in discussion they informed me that every single modification I may make to my car no matter how small from the specification it left the factory in must be notified to them.The underwriters will them decided on any additional premiums to be paid.
Querying what their definition of 'modification' is they say absolutely anything...wider wheels, suspension changes, transmission and driveshaft changes, engine upgrades..absolutely everthing must be declared otherwise the policy could be declared null and void at any time regardless of any premiums paid. Any claims also could also be rejected.
This has got me thinking...
Are all you guys fitting non factory spec Spyder chassis, CV driveshafts, Uprating Suspension, Uprating the engine etc. all informing your insurers of every one of these 'modifications' from factory spec?
I suspect not and some people who have innocently bought cars that have been modified or changed from factory specification may not even know what has been done to the car since it left the factory some 50years ago!

Thoughts please...

Alan.

[berni29]

Hi There

You raise a good point.

These days Insurance companies have to say this or else people would be fitting V8's and saying as far as they were concerned it was a minor modification. I think they call it "ass covering" or similar. I have heard of people fitting Zetec engines to Elans and it making no difference to the premium.

I recently fitted a dashcam to one of my cars and did in fact notify the insurance company. Ditto when I changed my Porsche 986 seats for 987 ones.

I would not have considered telling them about like for like mechanical parts swaps such as chassis, drive shafts, brake bolts, etc and so on. At the end of the day if it ends up in court in front of a judge it will likely come down to what he/she thinks is "reasonable". I think if affects the value of the car (like adding a 5sp box might) then its reasonable to let them know.

Changing the premium by £2.87 or whatever it was is just "jobsworthing" and costs more in admin.

All the best

Berni

[alanr]

Yes I agree asking for an additional £2.24 after 5months is definitely jobsworthing'.
However the what was quite alarming I thought was 'failure to pay this additional premium' within 7days would result in cancellation of the policy without refund'!
I can understand if you fit a V8 in an Elan or even a Zetec you need to tell them but where is the line drawn on what you need to tell them? From what was said to me today I need to tell them absolutely every little thing I change from factory specification.
The point is with an old car of 50+years virually everything is a 'modification' because most of the parts we fit are 'repro' parts and not to original specification.
If you fit CV joints and don't tell them are they going to kick out the claim in the event of an accident. That is what was implied to me today!..Very thought provoking I thought.
Am I supposed to tell them i have fitted hi-torque starter motor and adjustable fromt shock absorbers?....All gets a bit silly really!
Is it just a case of them chasing uprated premiums?

Alan.

[rgh0]

I defy anyone to define a "standard as it left the factory" OEM Elan or Plus 2. Lotus cant do that and no one else can either with 100% certainty. Insurance companies have to prove any maintenance work or modification contributed to the loss to deny a claim. Its a very grey legal area and most insurance companieis will do anything to deny liability to avoid an actually payout.

You know the defintion of insurance... "Were you pay money to get a receipt and nothing else "

cheers
Rohan

[alan.barker]

A good topic.
I would not fit Spyder Chassis and i don't think it was homologated for a crash test.
Here in France there are some with Spyder Chassis and i am sure it is not Legal. Also converted to Cabriolet +2 cars. A converted +2 to Cabriolet must be weaker in a crash and no Type Approval/Homologation.
Sorry to dampen your Fireworks.
Maybe someone has real facts.
Food for thought
Alan

[Craven]

My understanding of an insurance claim includes condition of the vehicle and has this in anyway contributed to the claim, so a worn or mismatched tyre, partly ineffective screen wiper could be more of a contributing factor than a professional made after market replacement part.

[69S4]

I can understand 'absolutely everything' including replacement engines, gearboxes, brakes etc but really - 'absolutely everything'. Different spark plugs, electronic ignition, brake pads, gear knob, nuts and bolts? For some of our cars the mods would read like a suppliers stock list. And who's competent to judge or even understand these things. Almost certainly not the insurance co office staff. They'll just pass it on to the underwriters for their consideration, and someone there will take fright and either jack up the premium or refuse the risk.

On the other hand, have a claim and you're subject to potential intense scrutiny of the originality of the car if you don't follow the rules. It'd probably go through ok if it was a low value claim, but if it was your car that set fire to the Luton airport car park then the non originality of your carpet (or your radio aerial or some other trivial item) will be reason to void the policy. It's no win with this. All you can do is take a sensible approach and hope nobody notices.

[JohnP]

Reading this prompted me to look at the 'modern' Lotus boys forum on SELOC. The concensus there is that it is prudent to declare EVERYTHING - even modified seat belts and trim, and that it usually makes little or no difference to the premium. For example, if you had installed a super expensive radio instead of an old PYE, and it was stolen, you would want to claim for what was stolen!
Of course it is a bit of a one size fits all requirement by the insurer but they have to cover all bases and to quote Alan from the first post in the event of failure to declare modifications "Any claims COULD also be rejected" - not "SHALL be rejected"
To be honest, for most owners it should be pretty easy to summarise what is not 'standard'. Perhaps we could make a checklist here?
Sympathy regarding the brusque tone of the demand from Alan's insurer - but that is the price we pay for no longer having a friendly broker but using much cheaper online insurers with automated accounts systems.
Thanks for posting Alan - it will make me review my next renewal notice more carefully.

[alanr]

Just to take things to the extreme but to illustrate how silly this insurance and modification business all seems to me to be...
It is all very well my insurance company telling me today that I must tell them about every single modification done to my car from original specification but how does it work with say an ordinary Joe who maybe isn't fully up to speed say with Lotus when they buy a car know exactly what modifications have been done to his car in its 50year history?...They can't,it is impossible..
Is he/she therefore strictly speaking driving around in an illegal car and running the risk of the insurance company not paying out in the event of a claim?
Fortunately with Elans and +2's I think I personally think I know what I am looking for modification wise when buying a car but what if say I went off now and purchased say a TVR Cerbera 12 speed of which I know very little about other than it is quite a potent beast. I then Insure the car, have an accident, triy to claim and the accident assessor tells me it has modified suspension and umpteen other modifications and therefore the claim is therefore being kicked out!

Something seems not right with all this and begs the question if getting customers to list all modifications done to a car from original specification with something like a 50year old Lotus is just Insurance companies trying to jack up the annual premium and get out of paying claims?
I think it is quite concerning..
Alan.

[alan.barker]

It could be a good idea to have the Car checked over by someone for a small fee.
It could be worth paying £50 to have peace of mind.
Alan

[alanr]

It could be a good idea to have the Car checked over by someone for a small fee.
It could be worth paying £50 to have peace of mind.
Alan

OK, That could be a good idea. Who would you suggest?... and what if that 'someone' missed something when checking the car for modifications from original specification?
In the crazy world that we now all live in there potentially could be both legal and costly implications to the person carrying out the modification check!

As I said earlier in this thread all this mandatory modification notification to insurance companies is just plain silly when applied to a 50year old classic car but the implications of not telling them everything could equally and potentially turn into a nightmare at claim time it seems.

Alan

[alan.barker]

If he missed something the problem will be his. You have proof of good intent so you are covered.
Alan

[smo17003]

Isn't this something that perhaps a body such as the Federation of British Historic Vehicle Clubs, or one of the classic car magazines should be investigating and advising upon? With thousands of classic cars in use in the UK there must be dozens, if not hundreds, of insurance claims made each year. Are there dozens of horror stories out there where owners have lost not only their cars, but have then also had to suffer an invalid claim due to a "small print" infringement? Or maybe there isn't, who knows?
Could it be that insurance is so competitive that some insurers are costing modifications as extras to increase income? A bit like Ryanair using any excuse to get a few more quid out of their passengers.

[atthelimit]

Dear all,

As a recently retired insurance broker I can perhaps add my thoughts on this.

It is important that you find an insurance company that takes a reasonable view on matters, and yes they do exist.

I’m sure you can all understand why declaring modifications are important, there’s a big difference between a car that’s just fitted with solid driveshafts, to a full spec track car, with highly tuned engine, stiffer springs, lowered, lsd, etc. Thats why it’s important that all modifications are declared so that they know what they are insuring and what might be an appropriate premium.

In practice the specialist insured use a points system, so minor mods that have no performance benefit might score 2 points, so solid drive shafts, ally radiator, spyder chassis and even added to together are unlikely to trigger a load in premium or at worst a modest one of say 10%. But a tuned engine, lowered stiffer suspension, wide wheels, upgraded shocks and items like a roll cage, full harness belts etc score more heavily not only because they are mainly performance enhancing but point to a more sporting / enthusiastic driving style. Why else would you use competition spec suspension when a standard Elan is very hood in the first place.When a car is too wild they will decline to insure it and point you to the insurance market who specialise in modified cars.

A large amount of modifications are done by their owners and the competency and quality of work can vary wildly.

There is also the question of repairs and value, if a modified car is damaged it has to repaired with appropriate parts, you can’t have standard suspension on one side and a fully modified set up on the other, this might involve a specialist repairer. Uprated parts cost more than standard items and increase the cost of repairs or the potential write off value of the car.

So in conclusion, declare everything, make sure it’s in writing so there can be no misunderstandings or discrepancies, and shop around for an insurer who understands our cars.

In my working life an elan with up to 150bhp, Tony Thompson type suspension, spyder chassis, roll cage, ally rad, alternator, high torque starter motor would probably receive a 25% load on the standard premium and as classic car insurance is cheap anyway, it really is not much to pay, to be properly insured and confident in the event of a claim that it will be dealt with without any awkward questions etc. I should also mention that items like a dash cam, fire extinguisher, vehicle tracker will bring your premium down.

Quite a lot of the previous comments seemed quite disparaging about insurance but if you declare everything up front, pay the extra premium you really should have no problem

The insurer who wants to cancel the policy in 7 days if you don’t pay £2 is probably not the insurer you want to be with.

[alanr]

atthelimit Hi,
Good to get things in perspective from an insurance broker point of view and enforcing the message that we must list absolutely all modifications however minor that we do to these cars. i think I personally have now got this message loud and clear.
I must also say though from a customer point of view that it is extremely difficult to know who is a good insurer to go with. I like I guess most on here usually go with who quotes the most competitive price when deciding who to insure our pride and joy with and I would strongly suspect that you would say that is definitely not the best way to choose an insurer!

Also there is always, for me anyway, an element of nagging doubt/fear of what will happen when or if I make a claim.It is always will they or won't they pay out without loads of hassle. After all it is only really when we make a claim that we learn how good and efficicent the insurer really is.

Anyway, thanks again for the input...Appreciated!

Alan.