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An extended warranty, or the vehicle protection agreement, is a unique warranty crafted to protect you
from costly and sudden breakdowns on a car. Those who might have purchased their cars from
dealerships can be conversant with extended warranties since most salespersons will always introduce it
as an add-on. An extended warranty is crucial in providing the car owner peace of mind even when the
car is extremely out of order.
The warranty provider always comes in place and cushions all the finances incurred during repairs and
replacement. However, many still need to understand extended warranty, which brings about
confusion. Most car enthusiasts need help differentiating extended warranties, factory warranties, and
insurance policies.
This article will help one understand the relationship between an extended warranty and insurance.
Difference between extended warranties and insurance policies
Extended warranties and insurance policies are two different things that often need to be clarified. Here
are some differences that will help you clearly understand that, indeed, the extended warranty is far
different from the insurance;
Third-party providers and the factory provide extended warranties
This is a significant difference between the insurance and the extended warranty. The providers of
extended warranties are primarily the factory and the third-party providers. The factory that initially
provided the factory warranty offers extended coverage once the manufacturer's warranty is over. The
factory warranty primarily covers cars for 36,000 to 100,000 miles depending on the type of coverage
offered.
However, once the period is over, the factory warranty is rendered expired hence the need to purchase
an extended version. Besides, you can source an extended warranty from third-party providers out
there. These are vendors who offer extended warranty protection to their customers.
On the other side, insurance policies get provided by the insurance providers. The insurance helps cater
for all the finances that occur in the event of an accident. Therefore, the extended warranty is never
provided by the insurance.
Insurance policies are compulsory, while extended warranties are not
Insurance is a must-have for any driver and car owner here in Canada. It is against the law to drive or
own a car with no insurance or one that is expired. That is punishable by law. As a result, everyone is
advised to have their cars secured by insurance premiums. These premiums are significant since cars are
prone to accident risks.
However, the expenses arising from such occurrences burden the car owner and those affected.
Insurance premium comes in to aid in clearing off the bill accumulated in such events. On the other side, extended warranties are not compulsory. One can own or drive a car without an
extended warranty plan. That is because extended warranties come in to aid in maintenance. Drivers
and financially stable car owners won’t find a need for extended warranty plans.
Car extended warranties have transferability, whereas insurance doesn’t
Once you own a car and plan on reselling it, there are several factors you will have to consider. You must
understand whether the vehicle's warranty and insurance can be transferred to the subsequent owners.
The deal is that extended warranties can be transferred to the new owners. Once the entire vehicle
ownership is transferred to the next owner, the extended warranty also comes along. On the other
hand, when selling a previously owned car, the insurance does not get transferred.
The new owner will have to get their insurance.
Benefits of securing an extended warranty
Peace of mind
The ultimate peace of mind is an expensive amenity if you own a problematic car. That is because the
car keeps engaging you when it breaks down with frequent bills to be cleared. However, with an
extended warranty plan, you are guaranteed freedom from all the pressure from maintenance.
Saves costs
An extended warranty is the best solution to dealing with high expenses resulting from car breakdowns.
A good example is when the powertrain parts of a car fall victim to faults. The expenses you will incur
will be huge, and you might find that a problem.
However, an extended warranty helps clear that reducing the amount you are likely to pay. You save
money that would have instead been directed into car maintenance.
Conclusion
Extended warranties are far different from insurance since they are provided by the factory, third-party
vendors, and car dealerships. Insurance companies provide the insurance premium, which ends the
conversation of whether the insurance providers can provide extended warranties.
Since cars are not made immune to faults and accidents, having both insurance and an extended
warranty will be a plus in keeping your car in good form. A-protect Warranty Corporation offers a
helping hand in protecting your car from all unforeseen breakdowns that might be costly to you.
Consider getting in touch with us at info@a-protectwarranty.com for a free quote.