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Insurance Coverage and Warranties (Questions to be asked (The cost, Which…
Insurance Coverage and Warranties
How insurance rates are set
Personal characteristics
Age
Gender
Marital Status
Personal habits (eg., smoking)
Type of frequency of vehicle use (eg., commuting)
Geographic location (often classified by postal code)
Rural locations usually have lower rates; urban locations usually have higher rates
Driving record
Accident with death, bodily injury, or property damage may trigger a surcharge on premium for three years
Number and kind of moving violations (and total of associated points)
Number of years insured with the company
Vehicle characteristics
Damage, repair, and theft record of type and model of car
Age of car
Types of insurance coverage
Liability (40-50% of premium)
Bodily- injury coverage
Property-damage coverage (e.g. to another person's car)
Comprehensive (about 12% of premium)
Pays for damage caused by vandalism, hailstorms, floods, theft, etc
Medical
Covers medical payments for driver and passengers injured in accident
Rental reimbursement
Pays a specific amount per day to rent a car while yours is being fixed
Towing and labour
Collisions ( up to 30% of premium)
Pays fro the physical damage to your car as a result of an accident
Limited deductible
Warranties
As-is (no warranty)
No expressed or implied warrant
Some provinces do not permit "as-is" sales on used cars
If you buy a car and have a problem with it, you must pay for any repairs yourself
Implied warranties
Warranty of mercantability- a product will do what it is designed to do
Warranty of fitness for a particular purpose- a product will do what the seller promises it will do
Always in effect unless the product is sold as-is or the seller says in writing that there is no warranty
Dealer warranties
Offered and specifically written by the dealer
Terms and conditions can vary greatly
Useful to compare warranty terms on similar cars or negotiate warranty coverage
Unexpired manufacturer's warranties
Manufacturer's warranty can sometimes be transferred to the new owner. There may be a fee for the transfer process
Questions to be asked
The cost
Which repairs the contract covers
Whether the warranty already covers the same repairs
Whether the vehicle is likely to need repairs and, if so, the potential cost of repairs
Whether there is a deductible and, if so, how much?
Whether repairs and service can be performed at locations other than at the dealership
Whether the contract covers incidental expenses such as towing
Whether there is a cancellation or refund policy and, if so, the cost
Whether the dealer or company offering the service is reputable
Whether you can purchase the service contract later