A Car Owners Guide to Insurance vs Car Warranties

When you purchase a vehicle, you want to protect that investment. The average price of a new vehicle in 2021 is topping out at over $40,000, and the costs of car ownership are higher than ever. Both auto insurance and car warranties help you protect your hard-earned money in case of an accident or a breakdown. You might be wondering how to find the best rates for insurance and if a car warranty can be cost-effective. Here, we’ll discuss how you can find the best rates and get the coverage you need.

Car Insurance Companies Are Not All the Same

Different car insurance companies appear to offer similar coverage. But there are key differences that can affect both price and coverage. Some issues that affect car insurance rates are factors the driver can control, like driving history and the type of car they own. However, car insurance companies also base their rates on how many accidents occur on average in that zip code and the age and gender of the driver.

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The Difference in Discounts

Car insurance companies do not all offer the same discounts and perks. That is why it is so important to compare car insurance quotes. Each car insurance company weighs risks in different ways. This can add up to a big difference in policy prices even for similar coverage. Some insurance companies are friendlier to drivers with spotty records. Others offer exclusive discounts to active duty and retired military members.

What Is a Car Warranty?

There are two types of car warranties. The first type many people are familiar with is the manufacturer’s warranty. What does a warranty cover is usually failure on specific parts of the car. For instance, a manufacturer may insure the powertrain on a vehicle for a specified amount of time or mileage. Once that period passes, the owner may have to pay the full cost of repair or replacement for the part if it fails. This is where extended car warranties come in. Car owners can purchase extended car warranties to help minimize sudden high repair costs.

Affordability of Extended Car Warranties

Many people wonder if purchasing an extended car warranty is a good idea financially. There are also concerns about whether an extended car warranty company is trustworthy. Finding reputable extended car warranty companies is key. Like car insurance companies, extended car warranty companies offer different types of warranty coverage at different rates. Car owners should call to ask about the coverage that fits their situation and a quote. Comparing quotes and features will help the car owner find the right coverage for a price they can afford.

Is Car Insurance Enough?

As stated before, car insurance companies differ in the coverage and services they offer. Some people wonder if they even need an extended car warranty if they already have a car insurance policy. An extended car warranty can work hand-in-hand with a car insurance policy. Most car insurance companies do not cover the cost of parts failures unless they are a direct result of an accident or collision. Furthermore, car insurance policies often only kick in after the car owner pays a deductible. An extended car warranty can help owners manage unexpected repair expenses.

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Pairing Insurance and Warranties

Nearly every state requires some form of car insurance, and most new cars come with a manufacturer’s warranty. But if the manufacturer’s warranty is about to expire or the car is not new, consider an extended car warranty. Ideally, car owners should buy an extended car warranty before the manufacturer’s warranty expires, so there are no gaps in coverage. 

The extended car warranty can help car owners’ budget and provide coverage that insurance companies do not offer. Extended car warranty companies often have customizable policies so car owners can get only the coverage they need. After all, it would be a waste of resources to get coverage for a service the car insurance policy already provides.

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Providing Peace of Mind and Stability

Both car insurance policies and extended car warranties can offer car owners peace of mind and a way to remain financially stable. These products can protect against sudden accidents and high repair bills. The cost of car ownership and maintenance is at an all-time high. It makes sense to protect your investment while also protecting your safety and that of others. It is important to compare companies and get quotes to ensure you are getting the right coverage at the price you can afford.