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Insurance Coverage and Warranties (Before buying Service Contract, find…
Insurance Coverage and Warranties
Types of insurance coverage
Comprehensive (about 12% of premium)
pays for damage caused by vandalism, theft, floods, etc.
Medical
covers medical payments for driver and passengers injured in accident
Collision (up to 30% of premium)
Pays for physical damage to your car from accident
Limited by deductible
Rental reimbursement
Pays a specific amount per day to rent a car while yours is being fixed
Towing and labour
Liability (40-50% of premium)
Bodily injury coverage
Property damage coverage
Warranties
Implied Warranties
warranty of fitness for a particular purpose
Always in effect unless the product is sold as-is or the seller says in writing that there is no warranty
Warranty of merchantability
Dealer warranties
Terms and conditions can vary greatly
Useful to compare warranty terms on similar cars or negotiate warranty coverage
Offered and specifically written by the dealer
As-is
If you buy a car and have problems, you must pay for repairs yourself
Some provinces do not permit as-is sales on used cars
No expressed or implied warranty
Unexpired manufacturer's warranties
Manufacturers warranty can sometimes be transferred to the new owner. there may be a fee for the transfer process
How Insurance Rates are set
Driving record
Number and kind of moving violations
Number of years insured with company
Accidents
Vehicle Characteristics
Damage, repair, and theft record of type and model car
Age of car
Geographic location
Personal characteristics
Personal habits
Marital status
Type and freq. of vehicle use
Gender
Age
Before buying Service Contract, find out:
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 vehicle is likely to need repairs and, if so, potential cost of repairs
Whether the contract covers incidental expenses such as towing
Whether the warranty already covers the same repairs
Whether there is a cancellation or refund policy and, if so, the cost
Which repairs the contract covers
Whether the dealer or company offering the service is reputable
The cost
Whether you can purchase the service contract later