Extended
Warranty Insurance
We
rely on appliances and machinery, from products like hoovers
and toasters to complex items like cars, computers and televisions.
We often take them for granted, that is until they go wrong!
Sometimes, a breakdown is just a nuisance, but it can be a
disaster, causing you great trouble and sometimes considerable
expense. The effect of a failure will depend on your circumstances.
For an example, a car breakdown can have very serious consequences
for your planned travel and breakdown of your washing machine
can cause extra work. But breakdown of an iron is a minor
inconvenience.
When
you purchase something new, the current law requires it to
be up to the job you will ask of it (Sale & Supply of
Goods Act). The manufacturer or retailer of the product guarantees
it for a period of time, this is generally a year at least
and in some cases longer. Manufacturers usually provide longer-term
guarantees on parts, but not their labour costs. You should
make sure you know what guarantee is provided free when you
purchase and what is covered. You can expect to have several
years' service from a car or household appliance, but faults
sometimes develop even in the best equipment and from the
best manufacturers. When things go wrong after the guarantee
period, you will have to arrange for the repair yourself and
pay for it, or buy a replacement.
Insurance
companies have developed policies designed to protect you
from the cost of these breakdowns. These extra policies are
known either as warranty insurances or as mechanical breakdown
insurances or just breakdown insurances and these are available
from a number of regular insurance companies.
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Car Warranty and Mechanical Breakdown Insurance - Apply Now!
Motor Vehicles and Private Cars
Insurance
Policies Available
There
is a wide range of mechanical breakdown policies available
that are designed to protect you against the costs of sudden
failure of specified components. The components that are covered
may vary according to the age and mileage of the car. This
ranges from insurance policies that provide wide protection
on new used vehicles through to more limited covers for older
or high mileage vehicles. You may even be offered the choice
of cover for the vehicle you are buying. Normally if you choose
the policy which covers a wide range of components, it will
be more expensive than one with a restricted list.
Insurance Cover
These
insurance policies normally pay for parts and labour charges
incurred in the repair or replacement of an insured component
following its failure. Cover usually applies strictly to the
failure of specified components only; if the component is
not listed for cover in the insurance policy, the claim will
not be paid out.
Insurance
policies will quite often have a maximum amount payable for
any claim. This may range from a few hundred pounds to a few
thousand. You are advised to check these limits in view of
the cost of breakdown for major components. Some insurance
policies have a betterment clause which means that you would
have to pay something if your car was improved following repair.
They may also have a maximum amount of money payable during
the life of the insurance policy. There may be an excess that
you will need to pay yourself if you have to make a claim.
Some of these components may have specific claim limits or
excesses applied as well.
These
insurance policies are not to be seen as maintenance contracts
and do not cover breakdowns that arise through normal wear
and tear. Some components will require replacement during
the expected life of a car as part of the regular recommended
servicing by the manufacturer. The insurer protects you against
any unexpected failure. The insurance policy should make these
points clear.
New
cars are covered usually for an additional 12 or 24 months
after the manufacturer's guarantee expires, but longer periods
of insurance cover are available on some vehicles. Used car
periods of cover offered will vary from three months to three
years from purchase. Policies can include a mileage limit
and cover will be discontinued if this mileage is exceeded
while the insurance policy is in force, so you need to consider
very carefully whether this limit will be enough for your
expected use of the car.
Mechanical Breakdown Insurance - Additional Benefits
Mechanical
breakdown insurance policies can also include additional benefits,
such as towing-in charges or a contribution to the cost of
a replacement car during these repairs. These benefits only
usually apply in conjunction with a valid mechanical breakdown
claim and can be subject to separate conditions and limits.
In some cases the policy claim limits will include payments
made under the additional benefits section of the insurance
policy.
Servicing and Conditions
Insurance
policies require you to comply with their conditions and if
you don’t comply the claims may be refused. Mechanical
breakdown policies normally require the car to be serviced
by an authorised dealer, at special intervals laid down in
the insurance policy. The insurance policy holder is totally
responsible for making sure that correct servicing on the
car is carried out at the intervals specified by the dealer.
Obtaining Mechanical Breakdown Insurance Cover
When
purchasing a new car through a dealer you will get details
of the insurance policies that they offer. Insurance cover
may also be available from the car manufacturer. For a used
car, the insurance cover available will depend on the age
and mileage. Insurance cover is also available from some insurance
companies, motoring organisations, brokers, banks or financial
institutions. A few mechanical breakdown insurances have an
option to renew the cover for twelve months when your policy
runs out.
How to Claim on Your Insurance
The
insurance policy will include a detailed claims procedure
that must be followed correctly. Do not authorise any repairs
to your car until you have checked the procedure. Most insurance
policies will require you, or the garage to contact the insurers,
before any repairs start, you need authorisation to proceed.
Car breakdown or warranty insurance policies are available
for a wide range of other mechanical items. These can be office
machinery, boats, diggers, kitchens and furniture are all
examples where policies are usually available. The principles
of cover are similar to those provided for household appliances
and cars, but the insurance policies may have different conditions.
Insurance Codes of Practice
There
are three Codes of Practice:
- the
"Guidance Notes on the General Business Code of Practice"
- the
British Retail Consortium Code of Practice for extended
warranties on electrical goods
- the
Society of Motor Manufacturers and Traders' Code of Practice
for mechanical breakdown insurance schemes which both cover
a range of matters including insurance
Other Insurance Information
Insurance
policies are very important documents. You must read your
policy carefully as soon as you receive it. If you do not
understand anything then you should ask the person who sold
you the policy to explain. You may wish to check that the
insurer is a member of the Insurance Ombudsman Bureau or the
Personal Insurance Arbitration Service. These insurance bodies
can help you if you have a dispute about your insurance that
you cannot resolve. Your insurance policy will have details
of this procedure.
Get
Car Warranty and Mechanical Breakdown Insurance - Apply Now!
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