Car Insurance Versus Car Warranties

Here are some of the major differences between car insurance and car warranties.

While auto insurance in Carrollton, Texas and car warranties both offer protection for your vehicle, these forms of coverage are quite different.  Interested in what differentiates these two forms of auto protection?  Then here are some of the major differences between and auto insurance policy and a car warranty.

Car Insurance

At the most basic level, car insurance is designed to offer the policyholder financial protection in the event that they are responsible for third-party injuries, damages, or other losses.  However, there are other insurance options that offer the policyholder coverage for their own medical treatment and car repairs following an accident or other damaging event.

Car Warranty

Car warranties are generally issued by auto manufacturers on brand new cars.  Essentially, a warranty is a manufacturer’s guarantee that the car will operate as promised.  Warranties offer coverage for any damages that might stem from a mechanical malfunction or breakdown within the vehicle.

Major Differences

  • While you have to secure your own car insurance coverages, this coverage is ongoing. So long as you continue to pay your premiums and adhere to your policy conditions, then you will have the coverage that you need.  On the other hand, car warranties come standard on new cars, but the coverage they offer is limited.  Coverage will expire once a certain number of years or miles is reached.
  • Auto insurance will offer coverage for third-parties. If the policyholder causes an accident that results in losses to others, then their car insurance will offer coverage for the affected party’s medical treatment and repairs.  In contrast, a car warranty only offers coverage for the vehicle it is issued on.
  • Finally, a car insurance policy will offer coverage for the damages caused by an accident, vandalism, fire, extreme weather, or other external events. Car warranties offer coverage for mechanical breakdowns, malfunctions, or other internal issues.  A good way to think about it is that car insurance offers coverage for the things that happen to a car, while a warranty offers coverage for things that happen within a car.

These are the major differences between car insurance and car warranties.  Are you looking to secure the right auto insurance in Carrollton, Texas to protect your car?  Then contact the experts at Mike Leonard Insurance Agency.  Our dedicated team is eager to find you the right coverage from one of our many carriers including: Kemper, MetLife, Travelers, The Hartford, Safeco Insurance, Progressive, and American Strategic Insurance.