Last week I discussed how exterior modifications to your vehicle are covered by your auto insurance policy.  But what about interior modifications?  What if you switch out your radio/cd player for a superior model?  Or, if you add a dvd player with several screens throughout your car?  What about boom boxes and amplifiers?  And how about those GPS units that attach to your dash or windshield?

The standard auto policy covers electronic equipment that is installed where the equipment is intended for such equipment.  This means that electronic equipment that is permanently installed in a location not intended for such equipment is not covered.  To clarify using the above examples, the upgraded radio/cd would be covered if it was installed where the original radio was located.  But all the other examples would not be covered.  To further clarify, the dvd and screens would be covered if they came with the vehicle.  But they would not be covered if they were installed after you purchased the vehicle because they would be installed in a location where they were not intended to be located.

Similar to exterior modifications, you can purchase additional insurance to cover electronic equipment that is not covered by the standard policy.

So, you want to trick out your new ride.  Maybe add a new set of shiny rims and tires.  And a spoiler would look nice.  How about lowering the vehicle a couple of inches?  When you’re all done, you’ve spent hundreds if not thousands of dollars for your customization. 

But what happens if your new add-ons are damaged or stolen?  Will you auto insurance policy cover the loss?

If you have a standard auto insurance policy, the answer would be “no.”  The standard auto insurance policy does not cover any modifications to your vehicle.  However, most insurance companies can cover your customized vehicle with special endorsements to your policy (you’ll have to pay a little more premium for this coverage).

If you have modified your vehicle and would like to make sure your insurance policy covers the customization, check with your insurance agent.

You may be surprised that the answer is “yes!”  Although most propety insurance policies exclude flood losses (a tsunami would be classified as a flood loss), auto insurance policies do not have a flood exclusion.  So, if a tsunami damaged your car, your auto insurance would cover the damages.  You would have to carry the comprehensive (also known as “other than collision” ) coverage for the damages to be covered.

Have you ever filed an insurance claim?  Many of us who purchase an auto or homeowner’s insurance policy may never ever file a claim.  But for most people, there’s some type of accident or event that can be covered by insurance.  That’s why we have insurance – for the unexpected events in our lives.  Most claims are small – minor fender benders for auto insurance and minor weather related claims for homeowner’s insurance.  Some claims are serious like a motor vehicle accident where someone dies or a total loss to a residence by fire.  Again, that’s what insurance is for.  And some claims are just plain wacky.  They may be big or small, but they’re all quite unusual.  Take a look at the following article for some wacky claims:

Wacky Insurance Claims

Posted 18. Sep, 2010 by Forest in General Articles, Opinion

Insurance is something we all don’t want to pay but can come in handy in situations that we never planned for. In many cases (like home and car insurance) it’s a necessary evil and although I hate extra monthly expenses it has saved my butt a few times!

Most insurance claims are straight up damage claims of the most common nature. Minor car crash, small storm damage, stolen cell phone and similar. However insurance can cover a wide gamut of situations and sometimes some trulelu wacky insurance claims are filed. Not all get paid but believe it or not some do manage to.

List of Wacky Insurance Claims

The wackiest thing I ever claimed for was falling through a loft and landing on top of the fridge in the kitchen! The fridge probably saved me a hospital visit but it’s not that uncommon to fall through roofs (Ok that statement is a huge assumption, maybe it’s just me that is so clumsy!).

This is a list of the funniest and wackiest insurance claims that I could find from an article on Yahoo (wackiest insurance claims), An article on eList Mania (10 bizarre insurance claims) and and article on Barrington Insurance Brokers (funny insurance claims).

• A farmers herd of cows got into his games room and went nuts causing $3000 (AUD) worth of damage. The claim was paid!
• A pet poodle swallowed it’s owners false teeth resulting in a $1500 (AUD) claim that again was paid.
• A wasp flew up a drivers trousers and got in his underwear causing him to panic and put his foot in the accelerator at a stop light, causing a traffic accident!
• A grandmother took off her opal ring whilst babysitting her grand daughter. The grand daughter decided the ring matched the cats eyes and tied it to the cats collar. The cat ran off into some nearby forest and the ring was never seen again!
• A closed bus station toilet was claimed as the cause of a man soiling his underwear and claiming for a new pair of trousers! I think this claim was likely refused.
• A man pulled out of his drive and hit a bus. He claimed that the bus was 5 minutes early and that was why it wasn’t his fault!
• Voodoo was claimed as a possible cause of a broken windscreen.
• Hitting a pedestrian was justified by someone as they said they had to to avoid hitting the bumper of the car infront of them.
• Power steering was blamed by someone knew to it for doing a small turn that ended with their vehicle facing the wrong way!
• Another person claimed that the pedestrian they had hit admitted it was their fault because they had been hit before.

Some of these are hilarious but I bet they are no where near the weirdest. I am sure insurance companies process some unbelievable claims.

Interested in saving money on your auto insurance policy?  Check out the following article on some tips to save on your auto insurance premiums.

Lower Your Auto Insurance Costs

Automobile insurance premiums often take a big bite out of a family’s budget. You may, however, be paying too much for this coverage. The following are several approaches you can use to reduce your auto insurance costs.

• Choose higher deductibles, particularly if you currently have a low collision or other-than-collision deductible, such as $100 or $250. Increasing your deductible from $250 to $500 or $1,000, for example, can reduce your collision and other-than-collision premium by 15 to 35 percent.
• Eliminate collision and other-than-collision coverage on older, less valuable cars. If your car is worth less than $1,500, it may be wiser and cheaper in the long run to just retain this physical damage exposure. Used car valuations are available online at Kelley Blue Book.
• Maintain an excellent credit record, since insurance companies are increasingly using credit scores to price auto insurance policies. Consumers with poor credit often pay more for auto insurance.
• Buy a “low-profile” automobile. Before you purchase a new or used car, check into the auto insurance costs. Automobile models that are expensive to maintain and have higher theft and collision frequency rates tend to have higher insurance costs.
• Take advantage of multipolicy discounts by keeping your homeowners and auto policy with one insurer. Likewise, take advantage of multicar discounts by having all autos on one insurance policy.
• Seek out other auto insurance discounts (which can vary by state and by insurance company), such as defensive driving, good student, low-mileage auto, alcohol awareness training, air bags, antilock brakes, claim-free experience, and long-term customer.

Get more personal lines insurance and risk management tips and ideas from IRMI.

Copyright 2010
International Risk Management Institute, Inc.

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