Insurance for major car parts repair?

[TechHead87]

Is anyone here familiar with a company who provides insurance for major parts replacement on cars? (Engine/transmission/etc)

I recently heard a radio ad about a company doing this, but I'm not sure if they're legit because this is the first instance I've heard of this.

'Preciate any replies!

 

[CrackRabbit]

I thought that was usually called an extended warranty.

 

[aigomorla]

I thought that was usually called an extended warranty.

:hmm:

i could of sworn it was called that also...

 

[FoBoT]

most are scams, like most 'extended warranties'

many car insurance companies offer extended warranties, so if you really want one, compare the costs to what your car insurance company offers

http://clarkhoward.com/liveweb/shownotes/2008/10/22/14288/

Oct 22, 2008 -- Money-back car warranties a real ruse
Clark often gets calls from people who wonder if extended warranties on cars are worth it. Though he's not a fan of them, extended auto warranties can make sense in some instances.

Now Clark is getting calls from people being offered a unique kind of extended vehicle warranty that seems to be a real bargain. They're told they can purchase the warranty, and then if they never use it, they'll get back the money they paid. Turns out it's just a ruse.

The Kansas City Star reports there is a lawsuit concerning the sale of these money-back warranties that's been going on for 6 years! The plaintiffs, obviously, are having difficulty getting their money back. The court has now ruled that the warranty company should give the money back but…surprise…the company has since filed for bankruptcy. Good luck getting your money back!

Here's the lay of the land when it comes to cash-back warranties: The warranty companies market directly to dealers and get them to sell their warranties -- instead of a manufacturer's own -- at huge profit margins to both parties. But the warranty company itself doesn't even have enough underwriting to pay for repairs. They just collect money with no intention of paying it back out. Then they do what's called a "bust-out," which is essentially like filing for bankruptcy, and disappear with their share.

The end result is that you as a consumer are stuck holding a worthless warranty. So don't believe the claim that you'll get your money back at the end. If you do buy a car warranty, you want to be sure it is the manufacturer's own. Otherwise, it only has a marketing company backing it up, and it isn't worth the cost of the paper it's written on.

 

[Slew Foot]

<can of worms>

car insurance should be like health insurance. It should pay for gas and oil changes and everything else you need the car to do.

</ can of worms>

 

[spidey07]

Generally a scam. It would be a better idea to just build up a savings account to handle these minor troubles in life.

 

[aigomorla]

Generally a scam. It would be a better idea to just build up a savings account to handle these minor troubles in life.

depends on car..

i would never buy a used BMW without extended warrenty.

NEVER.

 

[JulesMaximus]

depends on car..

i would never buy a used BMW without extended warrenty.

NEVER.

And I would never buy an extended warranty from a TV advertisement.

 

[Pardus]

There are a lot of companies that are not scams, but charge so much, sometimes more than the car is worth.

Most people put that money in the bank for when the car breaks down, just have a reliable mechanic who you can deal with locally and never the dealership and sign up with AAA or similar in case you need a tow.

One of the worst extended auto warranty companies is USfidelis, they originally quoted me $4700 for a vehicle with 40,000 miles on it and the warranty would be good till 100,000 miles. The thing is, there policy lists specific parts they cover so if your transmission died, they only cover specific parts, most of the time, the part you need fixed you have to pay for.

What i can tell you, look for a company with an A rating by BBB, a zero deductible policy, make sure they include towing and rental and ask them for a copy of the contract before you sign, if they lists parts, don't sign with them.

Depending on the age of the car and amount of mileage, your may be better off saving the cash to pay for the repairs outright.

If your vehicle is still under the manufacturer's warranty, see if the dealership has a policy that sometimes goes up to 150,000 miles. These policies may cost more, but as least you know the repair will get done properly.