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Service Contract Insurance

After 9.5 years of driving and 54,000 miles on the road, my Toyota has incurred $68 to fix a broken heat shield and $42 for new serpentine belt. All the rest was regular maintenance which would not be covered by a repair policy.

So spending $1000+ to get $110 back seems bad economics.

Similarly, I kept track of all the “warranties” I was offered with appliances and electronics. Of 11 items bought, the total cost of those “warranties” would have been $1100. The ACTUAL repairs incurred outside the standard warranties was $110!!! So 10 cents on the dollar return once more!

$50 X 72 months=$3,600. Whether this scam is factory or 3rd party cancel and run away. Scheduled maintenance, if included for my car at dealer for 6 years would be less than $600.

Swallow your pride and cancel the insurance. Your husband is right.

My understanding is that if a repair needs to be done and it is not covered by the warranties, AUL will pay the cost

Except for all the exceptions that are no doubt somewhere in the contract in very small print. Get rid of this thing, it’s a ripoff.

Besides things covered by your regular car insurance policy, I can think of 2 things that could result in very expensive repairs that could be nearly catastrophic to the car and your wallet.

The 2 things are…
1 running low or out of engine oil.
2 overheating the engine [Most likely by running low or out of coolant].

I took a peak at the service contract, what is covered, what ain’t…

Guess what? From what I can discern, overheating, for any reason, and damage done by low or no oil, for any reason, are not covered. (Anybody, please correct me if I’m wrong.)

So, the policy probably won’t cover the worst case scenarios!
Back to my previous post… where I said the best way to protect the car is to monitor the car’s vital fluids by frequently checking. Do that and you will almost certainly avoid any catastrophic car problems. I do this with any car, new, old, covered by warranty, not covered by warranty…

I’m with the others here, cancel this contract and put some money in the bank to grow and that will be your insurance against any major repair after the warranty period is up.

If you are not good at saving money, this is what a friend did.
She bought a new car. She sat down and figured out that the warranty with the mileage cap she would be covered for at least 4 years.
She put $50 each month in the bank near her mothers home 75 miles away. This way she would not have easy access to the money, yet if need be…she would have a nice nest egg for any major repairs.
She has just passed the fifth year and has not had to use that money yet.
With interest she has well over $3000. Last time we talked, she planned to buy a new car and trade that one in. Leave $2000 in that account to grow for the new cars repairs and take a nice vacation with the remainder of the money.

If all goes the way she hopes, she will never need to add to that account again, yet it will be enough to pay for a nice vacation every 4-5 years without risking the repair money.