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5 Major Differences Between Car Insurance and Extended Warranties

by Paresh Bramhane
5 Major Differences Between Car Insurance and Extended Warranties

Understanding the world of automotive insurance can be a daunting task. There are many different types of coverage, and companies all boasting great coverage at low rates. Scammers further obscure the picture. You have doubtless received scam calls asking about your vehicle’s extended warranty. You may even be asking what an extended warranty is. How is it different from standard car insurance? If you find yourself in this position, this list has you covered.

Collision Coverage

The most well-known and frequent utilization of auto insurance is after a collision. Standard auto insurance protects you if you strike, or get struck by, another motorist in your car. This protection covers the cost of repairs to your car and the other party after the accident. An extended warranty will not help you here.

Medical Coverage

If you are in an accident that leaves you or a passenger in need of medical care, you will likely need help paying medical bills. The broken state of the healthcare system keeps medical costs sky high. Fortunately, in this case, standard auto insurance has you covered. It will help pay your medical expenses as well as anyone else involved in the accident. An extended warranty will not help you here.

Uninsured Motorist Coverage

Suppose you are in a collision with someone who does not have insurance, or perhaps they have very minimal insurance. If this is the case, you may be stuck paying thousands out of pocket. Luckily, standard auto insurance is here to help, too. It can cover the difference in insurance, ensuring you do not pay more than you must. An extended warranty cannot help you here either.

Liability Coverage

Lastly, if you are involved in an accident that damages your or someone else’s property, fear not. Standard auto insurance is here to save the day, covering the cost of any damages to property that results due to a collision. An extended warranty is of no help here.

Maintenance and Repairs

So, what can an extended warranty do? First, you must understand what an extended warranty is. This is easily understood as it is appropriately named. An extended warranty is an extension of your vehicle’s original manufacturer’s warranty. This means that the warranty company will foot the bill for repairs in the event of a breakdown. This also includes roadside assistance.

An extended warranty protects you from the cost of regular wear and tear. It covers most of your vehicle’s systems with just a few exceptions. These include regular maintenance like oil changes and items that wear out, such as windshield wipers and brake pads. Standard auto insurance will not help you with any of these.

Choosing the Plan for You

Now that you have a good idea of how these types of insurance differ. You are ready to choose the right product for you and your vehicle.

If you need standard coverage, the best way to start is to compare car insurance companies. This will ensure you get the best deal. Your search does not stop here, though. Insurers offer discounts to different types of drivers. Not all may be available in your area. Start by identifying three to five companies to call and ask questions.

If you are interested in an extended warranty, the process is quite similar. Begin by identifying the best extended car warranty companies. Be sure to shop around and compare quotes. Make sure to avoid any potential scammers in your vetting process. Most scammers will try to pressure you into a sale quickly, so take your time. A legitimate company will understand that choosing insurance is a big decision and will allow you ample time to decide.

From the outside, this industry may appear obtuse. However, if saving money is important to you, understanding the differences between auto insurance and an extended warranty is key. They are quite different and can save you money in different ways. Examine your situation and identify your needs. Once you know what is best for you and your vehicle, proceed judiciously. With some research and patience, you are sure to skip the scammers and find coverage that benefits you and your vehicle the most.

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