As a leading UK used car warranty provider, we’re frequently asked about the difference between car insurance and a car warranty.
To minimise any confusion and help customers make an informed decision about their used car warranty purchases, we’ve highlighted the key differences.
What is a used car warranty or an extended car warranty?
An extended or used car warranty is a service agreement that can help cover the financial cost of part failure and unexpected repairs, providing peace of mind after the manufacturer’s initial warranty has expired. While not legally compulsory, you might like to consider it a protective safety net for your vehicle.
This type of protection becomes particularly valuable when a component fails while the car is in use. A warranty can cover the repair costs for the faulty part, providing much-needed relief to the driver.
What is car insurance?
Car insurance is a legal requirement in the UK and is designed to protect you financially in case of accidents, theft, damage to your vehicle, or liability to others.
It typically covers events like collisions, vandalism, theft, and natural disasters, depending on the type of coverage you have (e.g., fully comprehensive, third-party, third-party fire and theft). Car insurance primarily deals with unforeseen incidents and is required by law to drive legally on the road.
What is the benefit of a used car warranty?
A recent YouGov report highlighted that 68% of motorists are anxious about potential breakdowns in their used cars, especially as auto repair costs have surged to an all-time high in 2023**. Surprisingly, the survey of over 2,000 used car owners uncovered that 78%—almost eight in ten people—do not safeguard their vehicles with an extended, used car-specific warranty.
This is where an extended car warranty steps in, providing invaluable benefits. It offers financial security by covering unforeseen repair costs and part failures that may arise after the manufacturer’s warranty expires. It gives you peace of mind, knowing that you can be protected against expensive repair bills.
Take note: Cover levels for extended warranties vary so it’s important to review the warranty terms, limitations, and exclusions of the warranty plan to understand what is covered for your vehicle.
Key takeaways
- Used Car Warranty/Extended Warranty: A post-manufacturer’s safeguard, offering financial cover for unexpected mechanical failure
- Car Insurance: Legal protection against accidents, theft, and damage, catering to a wider range of incidents.
Balancing protection for your vehicle
The best protection often involves a combination of both warranties and insurance. While car insurance guards against accidents and unforeseen events, a comprehensive extended / used car warranty steps in when mechanical and electrical issues arise, helping to minimise repair costs.
Get a cover you can be confident in with Warrantywise
Warrantywise offers a cover you can be confident in with 24/7 breakdown cover, car hire, and onward travel included as standard*. With over 23 years of industry experience, we’ll do all the hard work so you can stay in the driver’s seat. Start your quote today.
Sources
**All figures, unless otherwise stated, are from YouGov Plc. The total sample size was 4,469 adults with 2,102 of those confirmed to own a used car between three to 12 years old. Fieldwork was undertaken between 12th – 14th July 2023. The survey was carried out online. The figures have been weighted and are representative of all UK adults (aged 18+).