diff --git a/bundler/lib/bundler/plugin.rb b/bundler/lib/bundler/plugin.rb
index 3c68e5181224..faca6bea5306 100644
--- a/bundler/lib/bundler/plugin.rb
+++ b/bundler/lib/bundler/plugin.rb
@@ -113,7 +113,7 @@ def gemfile_install(gemfile = nil, &inline)
 
         return if definition.dependencies.empty?
 
-        plugins = definition.dependencies.map(&:name).reject {|p| index.installed? p }
+        plugins = definition.dependencies.map(&:name)
         installed_specs = Installer.new.install_definition(definition)
 
         save_plugins plugins, installed_specs, builder.inferred_plugins
@@ -258,7 +258,7 @@ def save_plugins(plugins, specs, optional_plugins = [])
         # It's possible that the `plugin` found in the Gemfile don't appear in the specs. For instance when
         # calling `BUNDLE_WITHOUT=default bundle install`, the plugins will not get installed.
         next if spec.nil?
-        next if index.installed?(name)
+        next if index.up_to_date?(spec)
 
         save_plugin(name, spec, optional_plugins.include?(name))
       end
diff --git a/bundler/lib/bundler/plugin/index.rb b/bundler/lib/bundler/plugin/index.rb
index 0682d37772b2..94683a5e544f 100644
--- a/bundler/lib/bundler/plugin/index.rb
+++ b/bundler/lib/bundler/plugin/index.rb
@@ -119,6 +119,12 @@ def installed?(name)
         @plugin_paths[name]
       end
 
+      def up_to_date?(spec)
+        path = installed?(spec.name)
+
+        path == spec.full_gem_path
+      end
+
       def installed_plugins
         @plugin_paths.keys
       end
diff --git a/bundler/spec/bundler/plugin_spec.rb b/bundler/spec/bundler/plugin_spec.rb
index e416772a3672..b379594c6f9a 100644
--- a/bundler/spec/bundler/plugin_spec.rb
+++ b/bundler/spec/bundler/plugin_spec.rb
@@ -65,8 +65,8 @@
     end
 
     it "passes the name and options to installer" do
-      allow(index).to receive(:installed?).
-        with("new-plugin")
+      allow(index).to receive(:up_to_date?).
+        with(spec)
       allow(installer).to receive(:install).with(["new-plugin"], opts) do
         { "new-plugin" => spec }
       end.once
@@ -75,8 +75,8 @@
     end
 
     it "validates the installed plugin" do
-      allow(index).to receive(:installed?).
-        with("new-plugin")
+      allow(index).to receive(:up_to_date?).
+        with(spec)
       allow(subject).
         to receive(:validate_plugin!).with(lib_path("new-plugin")).once
 
@@ -84,8 +84,8 @@
     end
 
     it "registers the plugin with index" do
-      allow(index).to receive(:installed?).
-        with("new-plugin")
+      allow(index).to receive(:up_to_date?).
+        with(spec)
       allow(index).to receive(:register_plugin).
         with("new-plugin", lib_path("new-plugin").to_s, [lib_path("new-plugin").join("lib").to_s], []).once
       subject.install ["new-plugin"], opts
@@ -102,7 +102,7 @@
         end.once
 
         allow(subject).to receive(:validate_plugin!).twice
-        allow(index).to receive(:installed?).twice
+        allow(index).to receive(:up_to_date?).twice
         allow(index).to receive(:register_plugin).twice
         subject.install ["new-plugin", "another-plugin"], opts
       end
@@ -138,7 +138,7 @@
       end
 
       before do
-        allow(index).to receive(:installed?) { nil }
+        allow(index).to receive(:up_to_date?) { nil }
         allow(definition).to receive(:dependencies) { [Bundler::Dependency.new("new-plugin", ">=0"), Bundler::Dependency.new("another-plugin", ">=0")] }
         allow(installer).to receive(:install_definition) { plugin_specs }
       end
diff --git a/bundler/spec/plugins/install_spec.rb b/bundler/spec/plugins/install_spec.rb
index 36672f0085e6..dc3a12913eef 100644
--- a/bundler/spec/plugins/install_spec.rb
+++ b/bundler/spec/plugins/install_spec.rb
@@ -265,6 +265,31 @@ def exec(command, args)
       plugin_should_be_installed("foo")
     end
 
+    it "overrides the index with the new plugin version" do
+      gemfile <<-G
+        source 'https://gem.repo2'
+        plugin 'foo', "1.0"
+        gem 'myrack', "1.0.0"
+      G
+
+      bundle "install"
+
+      update_repo2 do
+        build_plugin "foo", "2.0.0"
+      end
+
+      gemfile <<-G
+        source 'https://gem.repo2'
+        plugin 'foo', "2.0"
+        gem 'myrack', "1.0.0"
+      G
+
+      bundle "install"
+
+      expected = local_plugin_gem("foo-2.0.0", "lib").to_s
+      expect(Bundler::Plugin.index.load_paths("foo")).to eq([expected])
+    end
+
     it "respects bundler groups" do
       gemfile <<-G
         source 'https://gem.repo2'