Auto 'mechanical breakdown' insurance: quick look

[arbilab]

If you watch commercial TV, you are beseiged by these ads for 'car repair' insurance. 

"Car Shield"™ is one but not the only.  Not that my 35yo Toyota qualifies, but I looked briefly into the genre.

 

I'd say disregard the come-on claims.  Like much TV advertising, the BS quotient is high.  And like much insurance,

the grounds for denying your claim are many.

 

Preexisting conditions are excluded.  "Normal wear" which a great deal of auto maintenance falls under, is excluded.  You must PROVE strict adherance to manufacturers' maintenance schedules.  For example, if your engine explodes, the commercial makes it sound like "no problem".  BUT, if it exploded because the timing belt broke and the pistons hit the valves and you did NOT replace the belt at 50,000 miles (at your own expense), you're on your own.

 

Jumping to the reviewer's conclusions,  over half of Car Shield customers never used the insurance.  Of those who did use it, over half reported that the covered repairs would have cost less than the policy.  The reviewer suggests putting what the policy would cost aside into a contingency fund of your own.  If you buy the policy and you don't use it, it expires and you have to buy it again. 

Not so with the c'gency fund.  It's the only way to 'win'.

 

[wayupnorth]

I have got many of those stupid calls, "Did your vehicle warranty expire?", we can help for expensive repairs. Many times way before the vehicle made the 5 year warranty expiration and I never spent anything on major repairs in 8 years without an expensive policy that covers squat.

 

[askolover]

I keep getting calls and letters in the mail wanting me to buy a warranty for my Volvo.  It's still under bumper to bumper factory warranty!

 

[vacerator]

Oh, No!

Just say No! A monthly premium usually excedes most repair costs in the long run. Just save that money up. Or you can leas a new vehicle every 2 to 4 years for little more than the full covergae premiums.
Those home appliance coverage policies are also rip-off's.

 

[arbilab]

Yes, I left off the calls and letters.  I get those too.  I think the calls mostly outright scams. 

Never looked closely at the letters.

 

The industry as a whole is a scam.  Pretty much anywhere there is a crooked buck to be made, someone is already making it.

Another thing that was gooder about the good old days.

 

 

[combo52]

Great Post Rick

You should NEVER insure anything that you can afford to fix if necessary.

 

  If you can not afford repairs on an expensive car or appliance, you should NOT buy that item.

 

  Buying service contracts and extended warranties are ALWAYS a bad deal in the long run, Yes many people have stories where a SC payed off once, but you are guaranteed to LOSE in the long run.

 

  John

 

[firedome]

so true...

it's one huge scam, the house always wins. We get the damn calls all the time - for cars that are 10, 14, 16 and 51 years old.