What is the difference between car insurance or a car warranty?

 

We all see the commercials or deal with the calls. Save money by bundling your car insurance and your car warranty is about to expire. What is the difference between car insurance or a car warranty? Is there a difference?

 

What is Car Insurance?

Car insurance is a contract between you and the insurance company that protects you against financial loss in the event of an accident or theft. In exchange for your paying a premium, the insurance company agrees to pay your losses as outlined in your policy.

Car insurance provides coverage for:

Property – such as damage to or theft of your car.

Liability – your legal responsibility to others for bodily injury or property damage.

Medical – the cost of treating injuries, rehabilitation and sometimes lost wages and funeral expenses

These three categories have minimums that vary by state. Car insurance protects you against a perceived liability.

 

What is a car warranty?

A car warranty, on the other hand, is defined by Merriam-Webster as “A written guarantee of the integrity of a product and of the maker’s responsibility for the repair or replacement of defective parts.” Most warranties for a new car run for a specific period of time. Usually 36-60 months, with a mileage limit, depending on the manufacture.

Most manufactures offer a bumper-to-bumper warranty. This type of warranty is also known as a comprehensive warranty. This kind of warranty, not insurance, is standard with most new car purchases. The idea is that it covers everything that could go wrong with your car, from bumper to bumper. However, there are some exclusions, like items that will fail with normal wear and tear, including, but not limited to: windshield wipers, tires, brake pads, brake rotors, light bulbs, and window glass.

As you can see, there is a difference between car insurance and a car warranty. Both are used for different reasons and are not the same. One helps cover a liability or damage you may cause to property and the other is there to help with repairs and keep your new car running with little or no cost to you.

Talk to us today to find out how to get the best price and coverage for your insurance needs. Visit our YouTube Channel on everything insurance. 

 

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