What is Custom Parts and Equipment Coverage for Car Insurance?

If you've recently modified your car with custom parts or aftermarket accessories, it's worth reviewing your auto insurance policy to make sure those upgrades are properly covered. While standard auto insurance may cover your vehicle's factory-installed parts, it often provides limited or no coverage for aftermarket modifications. 

If you replace original equipment with custom wheels, a lift kit, a premium sound system, custom paint, or other aftermarket upgrades, you may need additional protection. And that's where Custom Parts and Equipment (CPE) coverage comes in. It's an optional auto insurance endorsement that helps pay to repair or replace eligible custom parts and equipment if they're damaged in a covered claim. 

In this guide, you'll learn what insurers consider custom parts and equipment, what CPE coverage does and doesn't cover, how much coverage you may need, how much it costs, and whether it's worth adding to your auto insurance policy. 

What Are Custom Parts and Equipment on a Car?  

If you've upgraded your car with parts or accessories that weren't installed by the manufacturer, they're generally considered custom parts and equipment. These upgrades are commonly known as aftermarket modifications.  

Unlike Original Equipment Manufacturer (OEM) parts that are installed by the automaker during production, aftermarket modifications are added later to improve your car's appearance, performance, comfort, or functionality. 

Insurers generally consider any permanently installed aftermarket part or accessory that increases your car's value beyond its original factory specifications as custom parts and equipment. Since these upgrades aren't typically included in your car's standard insured value, you may need Custom Parts and Equipment (CPE) coverage to fully protect them. 

Some of the most common examples of custom parts and equipment include: 

• Custom wheels and alloy rims 
• Custom paint jobs and vinyl wraps 
• Upgraded stereo and entertainment systems 
• Suspension modifications and lift kits 
• Performance upgrades, such as turbochargers or aftermarket exhaust systems 
• Custom lighting, including LED light bars and underbody lights 
• Body kits, spoilers, and running boards 
• Interior upgrades, such as custom leather seats or racing seats

What Does Custom Parts and Equipment Coverage Actually Cover?

Custom Parts and Equipment (CPE) coverage helps pay to repair or replace eligible aftermarket parts and accessories if they’re damaged in a covered claim, such as a collision, theft, vandalism, fire, or certain weather-related events.  

While the exact coverage varies by insurer and policy, it generally applies to permanently installed aftermarket modifications that aren’t fully included in your car’s standard insured value. Now that you know how CPE coverage generally works, let’s look at the types of custom parts and equipment it may cover. 

Wheels and Rims  

Custom wheels and rims are among the most common upgrades covered by Custom Parts and Equipment (CPE) coverage. This can include aftermarket alloy wheels, chrome rims, oversized wheels, forged wheels, and other custom wheel packages that weren’t installed by the manufacturer.  

If your custom wheels are damaged in a covered accident, stolen, or vandalized, CPE coverage may help pay to repair or replace them. Without this additional coverage, your standard auto insurance may only pay for the factory-installed wheels or provide limited reimbursement for the aftermarket upgrade.  

Replacement costs can vary significantly depending on the quality and type of wheel or rim you have. According to Performance Plus Tire, budget aftermarket rims may cost about $200 to $800 to replace, while premium and high-end custom rims can exceed $2,000 and, in some specialty cases, cost more than $31,000.  

If you have expensive custom wheels or rims, CPE coverage can help protect you from a potentially significant out-of-pocket replacement cost. Keep purchase receipts, installation records, and photos of the wheels and tires, as these documents can help support your claim and verify the value of the aftermarket equipment. 

Custom Paint and Wraps   

Custom paint jobs and vinyl wraps can significantly increase the value of your car, and they’re often eligible for coverage under a Custom Parts and Equipment (CPE) endorsement. This may include metallic or pearl paint, multi-stage paint jobs, airbrushed graphics, matte finishes, racing stripes, full-body vinyl wraps, and other professionally installed custom finishes.  

If your custom paint or wrap is damaged in a covered accident, vandalized, stolen, or affected by certain weather-related events, CPE coverage may help pay for the repair or replacement cost. Without this additional coverage, your standard auto insurance may only pay for the factory paint, leaving you responsible for the extra cost of restoring the custom finish.  

The cost of repainting or rewrapping a car can vary widely. According to Kelly Blue Book (KBB), a basic paint job can cost around $1,000 to $1,500, while the cost of mid-tier paint jobs usually varies between $2,000, and $5,000, and high-quality custom paints and wraps can cost $5,000 to $10,000 or more depending on the materials, design, and vehicle size. 

If you have spent a significant budget on a custom paint job or vinyl wrap, it may be worth adding a CPE endorsement to help protect that investment. In a covered claim, the endorsement can help pay for repairing or replacing the damaged custom finish, whether the damage requires a partial repair, panel repaint, wrap replacement, or a more extensive restoration of the affected area due to scratches and dents, vandalism, or accidental damage.  

Stereo and Entertainment Systems  

Aftermarket stereo and entertainment systems are another common type of custom equipment that may be covered by Custom Parts and Equipment (CPE) coverage. This can include upgraded head units, amplifiers, subwoofers, speakers, touchscreen infotainment systems, rear-seat entertainment systems, and other permanently installed audio or video equipment.  

If these components are damaged in a covered accident, stolen, or vandalized, CPE coverage may help pay to repair or replace them. Without this additional coverage, your standard auto insurance may provide limited reimbursement or only cover the factory-installed audio system.  

The cost of repairing or replacing a custom car audio system can add up quickly. A basic upgrade may cost a few hundred dollars, while a high-performance system with multiple amplifiers, subwoofers, and premium speakers can cost $2,000 to $10,000 or more according to TAS Electronics findings.  

Professional installation can add significantly to the total cost, with labor rates in many markets commonly ranging from about $100 to $250 per hour. If you’ve invested in a custom stereo or entertainment system, especially if it would cost more than $1,000 to repair or replace after a covered loss, you should consider having CPE coverage to help protect the value of your custom sound system.  

Suspension and Lift Kits   

Suspension upgrades and lift kits are common modifications for trucks, SUVs, Jeeps, and off-road vehicles, and they may be covered under Custom Parts and Equipment (CPE) coverage. This can include leveling kits, suspension lifts, body lifts, upgraded shocks, struts, control arms, and other aftermarket suspension components that weren’t installed by the manufacturer.  

Repairing a damaged lift kit or suspension system can be expensive. If your vehicle has a high-grade custom suspension or a professionally installed lift kit, the repair cost can increase significantly depending on the parts involved, labor time, and the level of expertise required.  

If the damage is severe enough that the suspension or lift kit must be replaced, the total cost can range from a few hundred dollars for basic setups to several thousand dollars for premium off-road systems. High-end custom suspension systems and lift kits can exceed $1,500 to $10,000 or more when upgraded shocks, control arms, and other performance components are included based on American Wheel's detailed analysis.  

For many off-road owners, the suspension setup is one of the most valuable aftermarket modifications on the vehicle. If you own a truck, SUV, Jeep, or another vehicle with a high-grade custom suspension or lift kit, consider adding CPE coverage to your car insurance policy. It can help protect your investment if the aftermarket suspension or lift kit is damaged in a covered accident, stolen, vandalized, or affected by another covered loss. 

Performance Upgrades  

Performance upgrades can add significant value to a modified car, and many of these upgrades may be eligible for Custom Parts and Equipment (CPE) coverage. Common examples include aftermarket exhaust systems, cold air intakes, turbochargers, superchargers, intercoolers, performance tuning components, upgraded fuel systems, and other modifications designed to improve horsepower, acceleration, or engine performance.  

Unlike cosmetic accessories, performance parts are often expensive to repair or replace. A premium aftermarket exhaust system may cost about $1,500 to $2,000 or more to replace, while turbocharger or supercharger setups can range from roughly $500 to $5,000 or more before installation, tuning, and supporting upgrades are added.  

More advanced performance builds can increase the total cost significantly. If a covered accident, theft, vandalism, or another covered loss damages these aftermarket performance components, CPE coverage may help pay for the repair or replacement cost.   

Keep in mind that major performance modifications can affect your car’s actual cash value (ACV) and may not be fully reflected in a standard auto insurance policy. To avoid coverage gaps, keep your insurer informed about any significant performance upgrades and make sure those modifications are properly documented on your policy.  

Security Enhancements

Security upgrades are often overlooked when discussing custom equipment, but many aftermarket anti-theft features may qualify for Custom Parts and Equipment (CPE) coverage. These upgrades are designed to help protect your car and may include alarm systems, remote immobilizers, GPS tracking devices, kill switches, steering-wheel locks, dash cameras with security features, and other professionally installed anti-theft equipment.  

The cost of these upgrades can vary widely. A basic alarm system may cost a few hundred dollars, while advanced GPS tracking and immobilizer systems can cost several hundred to several thousand dollars when professional installation and monitoring services are included. 

If you’ve installed an advanced security system to help protect your car from theft, it may be worth considering adequate CPE coverage for those aftermarket upgrades as well. If the security equipment is damaged in a covered accident, vandalized, or affected by another covered loss, CPE coverage may help pay for the repair or replacement cost. 

Lighting and Exterior Accessories

Aftermarket lighting and exterior accessories can improve your car's appearance and it's functionality, and many of these upgrades may be eligible for Custom Parts and Equipment (CPE) coverage. Typically, these modifications include LED headlights, fog lights, light bars, underbody lighting, custom taillights, roof racks, running boards, side steps, bull bars, grille guards, spoilers, and other aftermarket exterior accessories.  

These upgrades are especially common on trucks, SUVs, off-road vehicles, and customized sports cars. While some accessories may cost only a few hundred dollars, larger roof rack systems, premium lighting setups, and heavy-duty exterior accessories can add several thousand dollars to the value of the vehicle.  

If these aftermarket accessories are damaged in a covered accident, stolen, vandalized, or affected by another covered loss, CPE coverage may help pay for the repair or replacement cost. Without CPE coverage, you could end up paying much of the repair or replacement cost for custom accessories that weren’t included in the vehicle’s original factory setup. 

Interior Modifications

Interior upgrades can add comfort, style, and value to your car, and many of these modifications may qualify for Custom Parts and Equipment (CPE) coverage. Interior modifications may include custom leather or suede seats, racing seats, upgraded steering wheels, custom dashboards, ambient lighting, premium floor mats, center-console modifications, soundproofing materials, and other permanently installed interior accessories.  

Unlike removable personal items, these modifications become part of the car itself. If they’re damaged in a covered accident, vandalized, stolen, affected by a theft-related loss, damaged by fire, or involved in another covered event, CPE coverage may help pay for the repair or replacement cost.  

The cost of interior customization can vary significantly depending on the quality of the materials, the extent of the upgrades, and the labor required for repair or replacement. If you’ve spent a significant amount on upgrading your car’s interior for better comfort and a more premium appearance, it may be worth considering CPE coverage to help protect the value of those aftermarket modifications, depending on your insurer’s policy.    

What Isn't Covered Under Custom Parts and Equipment Coverage?

Custom Parts and Equipment (CPE) coverage can provide valuable protection for aftermarket modifications, but it doesn’t cover every type of damage or loss. The exact exclusions vary by insurer and policy, and understanding these limitations can help you avoid unexpected out-of-pocket costs.  

Common situations that may not be covered include: 

• Normal wear and tear: Fading, corrosion, scratches from everyday use, and gradual deterioration. 
• Mechanical or electrical breakdowns: Failures caused by defects, age, or lack of maintenance. 
• Unreported modifications: Upgrades that were never disclosed to the insurance company. 
• Damage exceeding your coverage limit: Costs above the CPE limit you selected. 
• Removable personal items: Phones, portable speakers, tools, and other belongings not permanently installed in the vehicle. 
• Intentional damage: Damage caused deliberately by the policyholder. 
• Racing or competitive use: Losses that occur during organized racing, track events, or other excluded activities. 
• Improper installation: Damage resulting from faulty or unauthorized installation of aftermarket parts.

Pro Tip: Always review your policy exclusions and ask your insurer how your specific modifications are covered. Coverage details can differ significantly between insurers and endorsement options.

Does Standard Auto Insurance Cover Aftermarket Parts?   

Not always. A standard auto insurance policy with collision or comprehensive coverage may provide little or no coverage for aftermarket modifications and custom equipment that were added after the car left the factory.  

Some insurance providers automatically include a small amount of coverage for aftermarket parts, often with a pre-determined limit of around $1,000, although the amount varies by insurer and policy.  

Even if your policy includes this built-in coverage, you could still face significant out-of-pocket expenses if the repair or replacement cost of your custom wheels, suspension, stereo system, paint, or other modifications exceeds that limit. If you have Custom Parts and Equipment (CPE) coverage, your policy may help pay for a covered loss involving those aftermarket parts, up to the endorsement’s selected coverage limit. 

Custom Parts and Equipment Coverage vs. Standard Auto Insurance

Standard auto insurance and CPE coverage can work together, but they do not protect the same things. The key difference is that standard coverage focuses on your car’s original factory equipment, while CPE coverage is designed to protect eligible aftermarket modifications and custom accessories.  

The table below shows the main differences:

If your car is mostly stock, standard auto insurance may be enough. If you’ve invested thousands of dollars in aftermarket wheels, suspension, audio equipment, paint, performance parts, or other custom upgrades, CPE coverage is usually the better way to help protect those modifications from a covered loss. 

Who Should Buy Custom Parts and Equipment Coverage?  

Not every driver needs Custom Parts and Equipment (CPE) coverage. If your car is completely stock and has no aftermarket modifications, your standard auto insurance may be enough. However, if you’ve invested money in custom upgrades that would be expensive to repair or replace, CPE coverage is often worth considering. This coverage is especially useful for: 

• Owners of modified cars with aftermarket wheels, suspension upgrades, custom paint, performance parts, or interior modifications. 
• Truck and SUV owners who have added lift kits, off-road lighting, roof racks, running boards, or other aftermarket accessories. 
• Car audio enthusiasts with upgraded stereos, amplifiers, subwoofers, touchscreen infotainment systems, or rear-seat entertainment setups. 
• Performance enthusiasts who have installed turbochargers, superchargers, exhaust systems, tuning components, or other engine-performance upgrades. 
• Show car or project car owners whose vehicle includes custom paint, wraps, body kits, and other high-value cosmetic modifications. 
• Drivers with expensive security upgrades such as GPS tracking systems, immobilizers, kill switches, and professionally installed alarm systems.

A good rule of thumb is to compare the total value of your aftermarket modifications with the amount of automatic coverage, if any, included in your standard policy. If replacing those upgrades would cost more than you could comfortably pay out of pocket, CPE coverage can help protect that investment.  

Before buying the endorsement, add up the current replacement value of all permanently installed aftermarket parts and choose a coverage limit that reflects the real cost of replacing those modifications after a covered loss. 

How Much Custom Parts and Equipment Coverage Do You Need?  

The right amount of Custom Parts and Equipment (CPE) coverage depends on the total replacement value of the aftermarket modifications installed on your car. A common mistake is choosing a limit that sounds reasonable instead of calculating what it would actually cost to repair or replace those custom parts after a covered loss.  

According to Yahoo Finance, the average payout for CPE coverage is around $5,000, and many insurers offer coverage limits ranging from $2,000 to $10,000 or more. Some insurers may allow even higher limits for vehicles with extensive modifications.  

To estimate how much coverage you need, add up the current replacement value of all permanently installed aftermarket equipment, including: 

• Custom wheels and rims 
• Lift kits and suspension upgrades 
• Custom paint and vinyl wraps 
• Stereo and entertainment systems 
• Performance upgrades 
• Interior modifications 
• Lighting and exterior accessories 
• Security enhancements 
• Any other customizations you’ve installed

For example, if your custom wheels are worth $3,000, your audio system $2,500, your lift kit $2,000, and your wrap $3,500, the total replacement value is $11,000. In that case, a $5,000 CPE limit would likely be insufficient, and you would need a higher endorsement limit to avoid a significant out-of-pocket expense.  

Also remember that some insurers automatically include a small amount of aftermarket-parts coverage under collision or comprehensive insurance, often around $1,000. That built-in amount may help with minor upgrades, but it is usually not enough for a heavily modified vehicle.  

A practical rule is to choose a CPE limit that is equal to or slightly higher than the total replacement value of your aftermarket modifications. Keep receipts, invoices, installation records, and photos of every upgrade so your insurer can accurately verify the value of the custom equipment if you need to file a claim. 

If you're comparing auto insurance policies, you can explore CPE endorsement options through an affordable insurance agency to find a policy that provides adequate protection within your budget.  

How Much Does Custom Parts and Equipment Coverage Cost?   

Custom Parts and Equipment (CPE) coverage is usually one of the less expensive endorsements you can add to a car insurance policy. According to MoneyGeek, the average cost of CPE coverage is about $8.50 per month, or $102 per year. Generally, insurers offer this coverage as an optional endorsement that is added on top of your existing collision and comprehensive coverage.  

Industry pricing research shows that CPE coverage commonly ranges from about $5 to $20 per month, although the actual premium can be higher for heavily modified vehicles or higher coverage limits. The cost usually depends on several factors, including: 

• The total value of your aftermarket modifications 
• The CPE coverage limit you choose 
• Your vehicle type and model 
• Where you live 
• Your driving and claims history 
• Whether the modifications increase theft or performance risk

For example, a car with $2,000 worth of aftermarket wheels will generally cost less to insure than a vehicle with $10,000 in suspension, audio, paint, and performance upgrades. In many situations, paying an extra $5 to $15 per month for CPE coverage can provide several thousand dollars of additional protection for your custom equipment, making it a relatively affordable way to help protect a modified vehicle.

The Bottom Line: Is CPE Coverage Worth It? 

Yes, CPE coverage is usually worth it if you’ve added custom modifications to your car that would be expensive to repair or replace. Without a CPE endorsement, you could be risking the money you invested in aftermarket wheels, suspension upgrades, custom paint, audio systems, performance parts, or other modifications, since standard collision and comprehensive coverage may provide limited or no protection for those upgrades.  

If your vehicle is modified, adding CPE coverage is often a relatively affordable way to protect that investment. In many cases, the endorsement may cost roughly $100 to $180 per year, depending on the insurer, your car, and the coverage limit you choose.  

In return, you gain coverage that may help pay for the repair or replacement of eligible custom equipment if it is damaged in a covered accident, stolen, vandalized, affected by fire, damaged by certain weather-related events, or involved in another covered loss.   

If you’d like help choosing the right CPE coverage for your modified vehicle, you can request a free quote or speak with an L.A. Insurance agent to compare available coverage options and limits.    

Frequently Asked Questions (FAQs)

Does custom parts and equipment coverage cover aftermarket wheels? 

Yes, CPE coverage can help pay to repair or replace eligible aftermarket wheels and rims if they’re damaged in a covered accident, stolen, vandalized, or affected by another covered loss. 

Can I add CPE coverage after I modify my car?

Yes, you can add Custom Parts and Equipment (CPE) coverage after modifying your car. This endorsement is specifically designed to help protect eligible aftermarket upgrades and custom modifications that are permanently installed on the vehicle. 

Is CPE coverage the same as full coverage insurance?

No, full coverage usually refers to liability, collision, and comprehensive insurance. CPE coverage is an additional endorsement that protects eligible aftermarket modifications and custom equipment. 

Does CPE coverage apply outside my state? 

In most cases, your auto insurance coverage, including CPE coverage, follows the vehicle throughout the United States, but you should verify any territorial limitations in your policy. 

Will my insurer require an inspection for high-value modifications?

Some insurers may request photos, receipts, or a vehicle inspection when the value of the aftermarket modifications is unusually high. 

Is CPE coverage available for classic or show cars?

Yes, but heavily modified classic or show cars may sometimes qualify for specialty or agreed-value insurance, which can provide broader protection than a standard CPE endorsement.