Bumper-to-bumper insurance is actually a warranty purchased from the car manufacturer and not a form of auto insurance. Bumper-to-bumper coverage usually pays for mechanical or equipment breakdowns, defects or issues with certain car parts, and labor costs. Car insurance, on the other hand, covers injuries and property damage resulting from car accidents and can protect you against vehicle damage caused by theft, vandalism, natural disasters, wildlife, and more.
What bumper-to-bumper insurance covers
New cars typically come with two factory warranties: a bumper-to-bumper warranty and a powertrain warranty. A powertrain warranty covers the car’s engine, transmission, and driveshaft. A bumper-to-bumper warranty covers everything on the vehicle not covered by powertrain, like electronics and air conditioning, with a few notable exceptions.
A bumper-to-bumper warranty does NOT cover:
- Wear items, like tires, brakes, and windshield wipers
- Routine maintenance, like oil changes and tire rotations
- Bodywork, interior trim, or glass
- Aftermarket accessories, such as stereo or engine modifications
Bumper-to-bumper factory warranties are usually good for at least three years or 36,000 miles. If you want longer coverage, you can purchase an extended warranty from the dealership or an outside company when the factory warranty expires. You can also buy extended warranties for used cars.
In most cases, extended warranties are not a wise investment. You would be better off putting that money in an emergency fund for repairs. One reason is that regular maintenance is necessary to guarantee automotive warranties won’t be voided. That means the coverage you pay for could easily vanish due to an oversight before you actually get to use it. As a result, you should always do some research and carefully examine what is covered before paying for a car warranty.
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