You need to have car insurance in order to drive; in almost every state this is the law, but this insurance is for car accidents. You can also buy insurance to cover the cost of repairing your car or for specific parts, as with auto powertrain coverage. Most people are familiar with this type of insurance in the form of an extended warranty because it is often offered by a dealership selling new cars; however, an extended warranty falls short of the benefits of breakdown insurance coverage. The following are three reasons for this.
More places to choose to repair your car
When you have a breakdown insurance policy, you will usually have a great many places that your insurance company will allow you to take your vehicle to for a repair. With an extended warranty, the options are fewer. Generally, an extended warranty that you purchased from a dealership may allow you to take the car to another dealership, but the dealership will need to have certified mechanics for the manufacture of your car. In other words, the other dealership must sell your model of car.
More components are covered
You will find when you take the time to read the extended warranty that a dealership is attempting to sell you that the warranty does not cover the cost of many common components. It will usually cover things that are not likely to break down, but more common parts that break are things you will have to pay for yourself. And because you will be taking the car to a dealership, it is possible that the parts will be more expensive. This also makes a breakdown policy more useful for a car owner.
You pay as you go
Like with other forms of insurance, you will make payments or perhaps pay in full for a six-month policy. This is much different than an extended warranty from a dealership. The cost of this type of warranty is tacked on to the total cost of the car, and if you are financing the car, it will add to the cost of the car in the form of higher monthly payments. A breakdown insurance policy can be canceled anytime you choose.
Naturally, you need to shop around, if only because each insurance company will have different rules. Some of them have limits on the age of the car or the mileage of the car. Others may have restrictions on traveling with your car, but there are insurance companies that will provide this type of coverage no matter where you travel in the country.