Do Car Insurance Companies Cover Performance Parts?

Most car insurance companies do not cover performance parts. Because they are high investment items, car insurance companies are not required to cover performance parts.

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UPDATED: Jun 2, 2022

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Written By: Laura BerryReviewed By: Joel OhmanUPDATED: Jun 2, 2022Fact Checked

Here's what you need to know...

  • Performance parts are defined as any after-market parts added to the vehicle to increase its performance in any way
  • State regulations do not specifically address an insurance company’s obligation to cover performance parts
  • You should always stay ahead of the game and discuss your insurance company’s options for performance parts before an accident

The question of whether or not car insurance companies will cover performance parts relies very heavily on individual state regulations and the insurance policies of the drivers involved.

This article will attempt to clarify some of the common factors that determine whether or not performance parts will be covered by your insurance company.

Examples of performance parts include cold air intakes, sport wheels, and turbochargers. Even when aftermarket parts are merely cosmetic, they are considered performance parts for insurance coverage.

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Do states require auto insurance companies to cover performance parts?

State car insurance regulations regarding how auto insurance companies pay claims are usually based on one of two methods, replacement cost or cash value.

  • In a replacement cost scenario, the claim is paid based on what it would cost to return the car to the condition it was in before the accident.
  • In the cash value scenario, the claim is paid out based upon the blue book value of that particular make and model.

In either case, the insurance company has great latitude when considering the cost of performance parts.

There are a small handful of states that specifically mandate performance parts be replaced with the same part where possible.

More often than not, states simply say the damaged parts must be replaced with similar ones guaranteed by the auto repair shop to return the car to its previous level of performance.

Less costly and lower performance parts may be used if a repair shop deems that your high-performance parts did not significantly improve the car over its factory defaults.

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What can I do to ensure my performance parts are covered?

Regardless of the laws in your state, you should always take a proactive approach and discuss performance parts with your insurance provider.

Make sure that coverage for such parts is clearly spelled out in your policy in a manner that you can understand.

The insurance company exists to make a profit and will most likely not cover performance parts if it is not required to do so.

You should also always get and save receipts when modifying a vehicle with performance parts.

Even in cases where your insurance policy spells out specific coverage for your modified car parts, you’ll experience resistance in paying higher claims if you cannot prove to the insurance company that you paid for and installed them.

Without a sales receipt, there’s no way to verify where the parts came from and whether or not they were added after an accident.

Can I get a special car insurance policy that covers performance parts?

Although it’s probably not possible to get a specific car insurance policy for covering performance parts, you can find policies designed to cover high-performance cars in their entirety.

Such specialty auto insurance policies will generally cover the normal things like state liability minimums as well as replacement value at current market prices.

Even with specialized policies, it’s still important to keep receipts.

When you purchase this kind of specialized insurance, document your vehicle with photographs and videos.

Insurance companies are more likely to be cooperative if they can see what it is they’re covering.

High-performance parts can be a great addition to just about any vehicle. But since they are high investment items, make sure your insurance policy will cover them before being in an accident.

Editorial Guidelines: We are a free online resource for anyone interested in learning more about auto insurance. Our goal is to be an objective, third-party resource for everything auto insurance related. We update our site regularly, and all content is reviewed by auto insurance experts.

A former insurance producer, Laura understands that education is key when it comes to buying insurance. She has happily dedicated many hours to helping her clients understand how the insurance marketplace works so they can find the best car, home, and life insurance products for their needs.

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Written by Laura Berry
Former Insurance Agent Laura Berry

Joel Ohman is the CEO of a private equity backed digital media company. He is a CERTIFIED FINANCIAL PLANNER™, author, angel investor, and serial entrepreneur who loves creating new things, whether books or businesses. He has also previously served as the founder and resident CFP® of a national insurance agency, Real Time Health Quotes. He has an MBA from the University of South Florida. Jo...

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Reviewed by Joel Ohman
Founder & CFP® Joel Ohman

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