How Does Using Aftermarket Parts On Your Car Affect Your Insurance?

Posted on: 16 December 2016

You don't need to know how to do your own car repairs or even diagnose engine problems to understand the differences between parts made by the original manufacturer and parts created by other third-party companies, also known as aftermarket components. Aftermarket parts tend to offer a lower price than manufacturer parts and may provide different performance benefits, but choosing this kind of car upgrades could interfere with the insurance you're currently using. Learn about the complex relationship between car insurance companies and aftermarket parts before making a choice about what to use on your vehicle.

Higher Value

While some aftermarket parts are designed to save money and cut the costs of major repairs, those parts that offer more features or greater performance than the original manufacturer's design usually cost far more. Even using inexpensive parts can add up if you're installing body kits, optional engine components, and other upgrades that add onto the car rather than just replacing broken or malfunctioning parts. Anything that increases the car's total value can affect your insurance.

When you first register your car with an insurance provider, they're basing the value of your vehicle off of information provided by the manufacturer. If you're driving a car that would usually have a value of $4,000 but add a $2,000 aftermarket exhaust system to the undercarriage, you're really driving a $6,000 car. If the insurer is only planning to cover the $4,000 they know about, you will end up being compensated less than you expect after an accident. Notifying your insurance provider about aftermarket upgrades is a good idea. It will inflate the amount you're spending on premiums over each six month period, but that's due to the extra protection you're getting to cover the increased value.

Local Law

Don't forget that not all aftermarket parts are legal in all areas. Even something simple like the wrong headlight replacement lamps could leave you in hot water when you accidentally violate local laws. Many people don't realize they have illegal window tint or exhaust tips that are too loud until they're receiving a ticket at the scene of an accident. While you won't necessarily endanger your insurance by breaking the law in these ways, you can't expect the claims process to cover your secondary costs for tickets and fines either. If the illegal parts are somehow involved in the accident, you may end up paying more for insurance specifically due to choosing the wrong aftermarket parts.

Repair Preference

While many aftermarket parts increase the value of a car, the low cost of the economical components ironically makes them more attractive to the car insurance companies themselves. Most companies include clauses in their contracts that allow them to specify the use of the cheapest parts when your car is being repaired at their cost, even if you would personally prefer parts from the original manufacturer. Others allow drivers to specify a preference for aftermarket or original components, but only if they remember to make a request when the car is headed to the mechanic's shop. The laws regarding the use of aftermarket parts without notification of the car's owner vary greatly from state to state.

Aftermarket Reliability

Many car owners are concerned that aftermarket parts are less reliable than the components created by the manufacturer, which could lead to an accident in the future that would further raise insurance rates. However, there has been no evidence gathered that parts made by third-party companies are any less durable, reliable, or long-lasting than the parts sold by the manufacturer. In fact, aftermarket and recycled parts are often the only options still available for older models no longer supported by the manufacturer. Talk to your insurance company and mechanic for more about this topic.