Disadvantages of Car Repair Insurance

You may have seen them in commercials-car repair insurance companies tout their products for hedging against any possible problems with the car or truck that qualify as "breaking down," resulting either from a parts malfunction or normal wear and tear on the vehicle. However, a huge number of drivers decline this kind of insurance, and prefer to take their chances. Why? Here are some reasons why car repair insurance is not a universally applauded product.

• Partial coverage - car repair insurance is customizable: that is, there are different options for insuring the transmission, the engine, the fuel system and all other kinds of parts. The problem is that these add up. Drivers generally don't know which part of their car is going to break first, nor can they really predict which parts of the car would be most troublesome over its lifetime. That's one problem with signing up for car repair insurance that only covers certain parts systems.
• The insurance burden - drivers already pay a good bit of insurance just to get a car on the street. Since today's basic liability insurance doesn't even intend to cover at-fault damages, many drivers go with comprehensive insurance, which incurs an additional cost. Many drivers are happy just to get all of the required insurance for dealing with the costs of a wreck or collision. Car repair insurance would put even more of an insurance burden on the driver's wallet.
• Claims handling - those who routinely deal with any kind of insurance know the game that insurers often play: an insurer will enthusiastically endorse an insurance product, and sign up new customers. Where it gets tricky is when the insurer is asked to actually pay a claim. Insurance buyers know that fine print can "void" much of the insurer's obligation. In the minds of many drivers, there's no point in paying for theoretical breakdown situations, only to find that in the rare chance that they do occur, some clause in the policy lets the insurer off the hook.
• The waiting game - when insurers do pay out, it may take months for the payment to reach the customer. That's time that a driver may not have to balance his or her checkbook against the financial liability of the vehicle breakdown. Again, a large number of drivers choose instead to keep money on hand for use in the event of a parts malfunction or breakdown of the car or truck they depend on for daily transportation.

If car repair insurance is tempting you, think about some of these basic considerations before signing on the dotted line. That's not to say that this kind of product isn't good for anybody, just that it's not for everybody, and the above issues tend to make it unattractive to many drivers.