Insurance companies

[Ginger]

As long as you are paying the increase premium for the increased value (whether real, perceived or artificial) are there any risks/implications from that?

I think so.

Consider the man that insures his, hmm, I dono, 2 tone 1993 Accord, for 10 grand in aftermarket parts. He's pays the increased premium for a couple months and all of a sudden the car disappears.

Consider next the man that purchases an expensive vehicle. He has used his assets, or claim to future assets (lien), to purchase this vehicle.

The man that had the Accord didn't have to show assets at all... he just willed his modifcations into effect and told the insurance company they existed. He's got an incentive to find a way to dump the car early on - he stands to gain from it if he doesn't have to provide evidence of modifications. Insurance COULD simply charge absurdly high rates for this kind of thing, but requiring reciepts is a good way of keeping the rates competitive (remember, some people actually want to purchase this coverage and there is some providor that wants to find a way to provide it to them) and realistic. It effectively eliminates that incentive.

Somebody could call up their insurance company and ask about this kind of coverage... but I've talked to my company too much recently.