Car Insurance vs. Car Warranty: What’s the Difference?

Car Insurance vs. Car Warranty: What’s the Difference?Understand the differences between car insurance and a car warranty.  

Extended warranty and car insurance are two terms that always come up when buying a car, new or used. These services are often believed to cover the same thing. In reality, though, both of these services cover very separate fields and are required for complete protection on the road. Read on to understand the differences between a car warranty and car insurance.

Car Insurance

If you’re a driver in the U.S., you legally have to carry a minimum level of car insurance (except in New Hampshire). Every state requires drivers to carry liability coverage, which protects the other driver in the case of a crash.

The minimum amount of Minnesota auto insurance coverage is $30,000/$60,000/$10,000. In the event of a covered accident, your limits for bodily injury are $30,000 per person, with a total maximum of $60,000 per incident. It also covers up to $10,000 for damage to another person’s property.

Other coverage includes:

  • Comprehensive: Covers damage from fire, flooding, theft, and more.
  • Collision: Covers damage caused by a crash.
  • Personal Injury Protection (PIP): This covers the injuries you and your passengers suffer when you are the driver at fault in a collision.
  • Uninsured/underinsured motorist coverage: Protects you and your vehicle from damage caused by people who don’t have insurance or don’t have high enough coverage limits.

Car Warranty

Most new cars will come with a manufacturer’s warranty, which you can often extend (for a price), and you can seek third-party warranties for new or used cars as well. A warranty is when the company ‘guarantees’ (and not ‘insures’) you that their product will be free from any kind of manufacturing defects. Should there be any problem arising during this period from the day the car drives off the showroom floor, the company will replace the parts it deems necessary to ensure proper functioning of the car. Warranties generally do not cover any kind of malfunction arising out of negligence on the customer’s part or due to normal wear and tear or parts like tires, batteries, and brake pads.

Need help finding the right auto policy for your needs? Don’t hesitate to contact us at Kurt Rolf Insurance Agency. Serving Minnesota, Wisconsin, Florida, South Dakota, and Arizona; our dedicated team is ready to assist you with all your coverage needs.