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We explain everything you need to know about car warranty insurance


Most drivers believe that car warranty is invaluable to their vehicles. Today, owners are able to keep their cars for longer periods of time than ever before as their vehicles are equipped with complicated electronics and high technology. Thus, they need to know everything about car warranty insurance.

What is car warranty insurance?

As insurance, car warranty, also called mechanical breakdown insurance (MBI) protects vehicle owners from paying the cost of parts and labor following any type of electrical or mechanical failure. When you buy a car, you get the basic warranty period by the manufacturer which also vary from 2 to 5 years.

What is covered by a car warranty?

Included in every comprehensive policy are major components such as the brake system parts, cooling system, engine, fuel & ignition system, gearbox steering, non-frictional clutch and transmission system.

Additional options might consider adding to your policy if they're not covered already. Warranty excludes the issue of general wear and tear and others that may contribute a percentage of the parts and labor cost.

Comprehensive policies cover even damages that incurred to non-insured parts.

If your vehicle is fitted with new parts that are superior to the original parts as the result of a claim, you may be expected to pay partial cost of the new part.

Options of car warranty

  • Manufacturer's warranty requires manufacturer to repair or replace the product if it is damaged or faulty.
  • Independent dealer/used car warranty is warranty at no extra cost when you buy a second-hand vehicle from a dealer.
  • After-market warranty is warranty to safeguard against any imminent disaster to the car after it is sold.
  • Breakdown repair cover helps out with your garage repair bills after a breakdown.
  • Some warranties may also require you to contribute towards labor charges.

Other policies

1. In some policies, any damage caused by the oil leak are excluded from the warranty.

2. The vehicle is for sale as long as they are well-maintained, in good condition, repaired and without defects.

3. For a warranty to stay valid, strict terms and conditions are adhered to, including keeping the vehicle in good repair state and have it properly serviced using an approved garage.

4. Using a franchised repair dealer will be charging more than using an independent garage auto shop.

5. If the vehicle was sold and the warranty has not been exhausted, then it is transferrable to new owners.

These warranties can be transferred to new owners if the vehicle is sold when the warranty is still valid

6. Use a certified garage shop.

Extended car warranty

A purchased new car includes the manufacturer’s warranty that lasts from 3 to 6 months and required mileage. After exhausting the car’s warranty, it is no longer valid so you have to purchase an extended car warranty. Some car owners bought an extended warranty simultaneously when they purchased the car. It is wise decision to do so for your car’s protection and your own peace of mind in case of emergencies. There different providers you can choose from. Study each one first before you close the deal and commit to anything. The contracts for extended warranty are more complicated than the manufacturer’s new car warranty.

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