Two Kinds Of Extended Auto Warranties

 

There are two main kinds of extended auto warranties. There are auto warranties that are bought through aftermarket auto warranty companies and there are auto warranties that are backed by a manufacturer.

An extended auto warranty that is bought through an aftermarket auto warranty company tends to be less expensive. Also, this kind of auto warranty tends to vary in both price and quality depending upon which company you buy from. This is why it is always important to do your research before making a purchase.

An extended auto warranty that is backed by the manufacturer generally includes a wide variety of repairs and services. Repairs performed on your vehicle are usually done in a dealership that is approved by the manufacturer. This means that you will not usually experience any issues when going to get them done.

No matter where you get your extended auto warranty company from, it is essential that you do research. Compare a variety of warranties for price and quality.

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Auto Security: Do Feds Have Our Back?

Government agencies in the U.S. and the U.K. are working to get ahead of the curve and let the public know that they are concerned about vehicle cyber security.

 Consumers should be aware of the possibility of a hacker attack on their cars. We now know that what used to be considered a movie scenario — remote hacking — could be done.

The current reality is that, while a variety of connectivity technologies have been transfused into cars, the equal and opposite security measures are yet to be deployed.

Surely, car hacking is the last thing automakers want to mention as they push the connected cars into the vast consumer disconnect. But government watchdogs in both the U.S. and the U.K. are working to get ahead of the curve and let the public know that they are concerned.

 Principles of cyber security for connected and automated vehicles

"Whether we're turning vehicles into WiFi-connected hotspots or equipping them with millions of lines of code to become fully automated, it is important that they are protected against cyber-attacks," said Martin Callanan, a minister in the Department for Transport at the British government.

He said this last week when the U.K. agency issued new guidelines, requiring manufacturers of Internet-connected vehicles to put in place tougher cyber protections to ensure a stronger shield against hackers.

It isn’t just the U.K. The National Highway Traffic Safety Administration (NHTSA) in the United States also issued last fall the federal guidance to the automotive industry for improving motor vehicle cyber security.

Questions to ask
So should we all sleep well, confident that the feds have our back?

Not so fast, Gracie.

Questions that come to my mind include:
1. Do the guidelines issued by NHTSA and British Department of Transportation have any teeth for security enforcement? 
2. More important, have they gone far enough to suggest effective cyber security measures for cars?
3. What are the differences in the proposals of the two separate governments?

As Roger Lanctot, director automotive connected mobility in the global automotive practice at Strategy Analytics, told us, “All of the work and guidance today is advisory vs. compulsory in nature.” Things will become real, in his opinion, “when financial and liability consequences are in fact defined.”

Sources of vulnerability in connected cars are many. Lanctot listed: “diagnostic ports, hobbyist/enthusiasts, dealers, suppliers/supply chain, criminals, and terrorists to say nothing of incompetence, bugs, and the management of multiple onboard systems crossing domains with different development standards.”

Facing so many areas inside cars that must be protected as cars morph into always-on computing devices, it isn’t easy to come up with comprehensive guidelines. And yet, “Regulators need to demonstrate they are doing something,” said Lanctot.

How do security experts see the development of government guidelines?

Gene Carter, vice president of products at OnBoard Security, for example, believes that “both the U.K. and NHTSA guidance documents included basic security tenets.”

He explained such measures should be followed by any company connecting hardware or software to the web — including security by design, defense in depth, principles of least privilege, etc.  In Carter’s opinion, however, these are basics. “I would hope that the automakers have learned enough from the IT world’s experiences, and they [should be] already doing those essential things.”

A few experts, including Carter, pointed out that the U.K.’s guidance does not go far enough in the area of software updates after a vulnerability is discovered.

Carter said, “The guidance merely states ‘organizations plan for how to maintain security over the lifetime of their systems.’”

In his view, “Over The Air (OTA) updates should be a requirement for automobiles.  It is impossible for a manufacturer to create a car that is free of vulnerabilities throughout the 10-20 year life of a car.  Without OTA, automakers are relying on car owners to bring their cars into a repair show every time a new vulnerability is discovered.  This will leave many cars exposed to known attacks, while OTA would allow the fix to be pushed to the at-risk vehicles immediately.”

Of course, car makers “will save a lot of money in recalls by offering OTA, so it is likely they will move to that technology on their own,” said Carter. Still, “I would have preferred the UK specify its use and not leave it so ambiguous.”

Meanwhile, David Barzilai, chairman, and co-founder of automotive cyber security firm Karamba Security weighed in on the U.K. government’s guidance. While applauding pre-emptive action they might take, he pointed out that there is one area “we don’t feel these guidelines go far enough toward effectively preventing car hacking,” he said. 

Again, that’s the area of how to deal with security bugs.

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How Are Your Auto Insurance Premiums Affected When Your Child Goes Away to School?

September is right around the corner and soon thousands of college and university students will be leaving the nest (and the car) behind. If your child is going away to school and is listed on your auto insurance policy, it’s time to give your auto insurer a call. It’s a call worth making as it could lead to a lower auto insurance rate.

Student discounts help parents save

Many auto insurers offer discounts designed to help parents keep a lid on the cost of auto insurance, and there are three discounts in particular that are worth exploring.

  1. Student Away from Home Discount
    If your college-bound student is attending school in another city or province, they won’t be driving your car nearly as much. Their time behind the wheel will be limited to holidays, school breaks and the occasional trip home for the weekend. As a result, many insurers offer a discount that could save you up to 50 per cent of the premium you’re paying for listing them on your policy.
  2. Good Student Discount
    As the proud parent of a college or university student, keep in mind that their good grades are worth bragging about—especially since it may result in a discount. If available, a Good Student discount could save you up to five per cent.
  3. Driver’s Training Discount
    If your student is a newly licensed driver who hasn’t taken an approved driver’s training course, it might be worth adding one more class to their schedule. You could save hundreds of dollars each year in premiums, for typically up to three years, after your child has successfully passed a driver’s training course.

Sending your child off to school…with the car?

If your child is taking one of your cars to school, or you’re planning on buying them one to get around campus (and to classes on time), a call to your auto insurer should still be in the books. If the vehicle is in your name, you can list it on your existing auto insurance policy to take advantage of multi-vehicle discounts.

However, taking a car to school full-time may turn out to be costly, even with the discount. Since your young driver will no longer be an occasional driver, they’ll need to be listed as the primary driver to ensure the policy accurately reflects who is driving the vehicle most. Otherwise, you run the risk of jeopardizing the coverage they’ll need, should there be a reason to submit a claim.

Give your auto insurer a pop quiz. See what mark they get by shopping around.

Are your premiums making the grade? Compare auto insurance quotes today to see if you could be paying less. On average, InsuranceHotline.com shoppers save $700 after comparing car insurance quotes with us; and, all it takes is a few minutes to compare quotes from our network of over 30 insurance providers.

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The Credit Benefits Of Auto Loan Refinancing

 

Auto loan refinancing can have many benefits for your short and long-term financial outlook. But if you keep a close eye on your credit profile, you might be wondering how refinancing is going to affect your credit score.

The truth is, refinancing any loan will invariably have minor, short-term impacts on your credit. They can vary based on your situation. For someone with a long, well-established credit history, these impacts will be minor; however, for someone with little to no credit history, these factors will make a much bigger impact.

Still, in the long run, auto refinancing will generally help your credit as it simultaneously closes out a loan and adds a loan approval to your credit report.

Let’s take a look at three ways an auto loan refinance can affect your credit profile:

1. CREDIT INQUIRIES

The first way refinancing can impact your score is the hard credit inquiries that will appear on your credit report. When a lender checks your credit report to evaluate how risky it would be to lend you money, that shows up as what is called a “hard” inquiry. Typically, these will impact your score by a small amount, typically by five to 10 points. And while they will stay on your credit report for several years, their impact on your actual score will dissipate after several months.

A number of hard inquiries from various types of lenders could be a red flag for prospective lenders. Groups of hard inquiries suggest you were desperate to open new credit, at some point, for some reason. Having too many hard inquiries in too short a period of time could hurt your ability to get good interest rates, or even get approved for a loan at all.

That being said, those same lenders usually understand that when you’re shopping for financing for a big-ticket item such as a home or auto loan, you are likely to get quotes from several sources to get the best rate. Most credit score models will group all hard inquiries made within a 14-day period together as a single unit. While they will be listed individually on your report, they will only affect your score once. For that reason alone, it is important to ask for quotes only after you have finished your research and you are ready to refinance.

2. YOUR CREDIT HISTORY

Another way an auto loan refinance impacts your credit is by altering your repayment history. As you make regular payments on time, your score improves. This demonstrates that you are a reliable person who takes credit obligations seriously.

When you refinance, you are wiping that payment history clean and starting from scratch with a new loan. Because some models will take older loan payment histories into account, but others don’t, your best bet is to just anticipate that this will impact your credit score and plan accordingly.

3. YOUR CREDIT UTILIZATION

Your credit utilization is the total amount you owe your creditors compared to your total available credit. Generally speaking, if your credit utilization is below 30%, you’re in good shape. Any more than that and your score will take a hit.

When you refinance a loan, depending on the new terms, you are changing your credit utilization. If you take out a loan for more than the original — to get cash out, for example — then you are increasing your utilization rate. If you take out a loan for less, you might be lowering your overall total utilization rate. While this shouldn’t be the primary deciding factor when it comes to refinancing, it can have an impact on your score.

You might see a short-term dip in your credit score after refinancing your auto loan, but the effect is typically negligible, and the potential benefits — including a lower payment amount and a lower interest rate — may far outweigh any negatives.

If you are ready to refinance your automobile loan, Autowrranty.com is here to help. When you apply with Autowrranty.com, your dedicated Finance Advisor will work to find you an auto loan that fits your financial and credit needs from one of our 25+ national lenders. Learn more about auto refinancing, try our car refinancing calculator, or apply now.

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Prepare For A Spring Road Trip By Keeping Your Car In Good Shape With An Auto Warranty



A really fun family activity during the spring is a road trip. Although road trips are fun, stress and frustration often occur for families while out on the road. Be sure to keep in mind the following tips in order to make certain that your family’s trip is a great one.

The best thing to do to prepare for a road trip is to get your family car in tip-top shape. Be sure to give the car a good tune-up because there is no worse hassle than experiencing a vehicle breakdown while out on your road trip. Be sure to have an auto warranty for your car so that the necessary maintenance and repairs won’t drain your wallet.

Also, be sure to plan ahead so that during the trip, your family knows what is going on. This can relieve stress and make things go a lot smoother. In addition, make certain that you invest in a GPS so that you get to your intended destination as planned.

However, it is impossible to predict when you will run into bumps in the road such as traffic and road construction. These occurrences are inevitable, so keep calm and don’t stress so that you and your family can enjoy the road trip.

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10 Steps to Buying Auto Insurance

When it comes to auto insurance, you want to be adequately covered if you get in an accident, but you don't want to pay more than you have to. Unfortunately, many people are doing just that, simply because they don't want to spend time shopping for car insurance. It's not inherently enjoyable, after all, despite how it looks in commercials featuring disgruntled cavemen and joke-cracking spokespeople.

But by doing some comparison shopping, you could save hundreds of dollars a year. When one of our editors used a rate-comparison service, he got basic coverage quotes for his two old cars that ranged from $1,006 to $1,807 — a difference of $801 a year. If you're paying thousands to your current insurance company because you have a couple tickets, an accident or an out-of-date and unfavourable credit rating, shopping your policy against others might be well worth the effort. Look at it this way: You can convert the money you save into buying something you've wanted or needed for a long time.

Step 1: Decide How Much Coverage You Need
To find the right auto insurance, start by figuring out the amount of coverage you need. This varies from state to state, so take a moment to find out what coverage is required where you live. You will find a list of each state's requirements and an explanation of the various types of insurance in "How Much Car Insurance Do You Need?" Also, check out "Little-Known but Important Car Insurance Issues," which has a glossary of basic insurance terminology. If you're a first-time driver and need a comprehensive overview of car insurance before you go on, review this guide from the National Association of Insurance Commissioners. Now you're ready to make a list of the different types of coverage you are considering.

Once you know what's required, you can decide what you need. Some people are quite cautious. They base their lives on worst-case scenarios and insurance companies love that. Insurance companies are in the risk business, and they know a policyholder's likelihood of being in an accident, as well as how likely it is for a car to be damaged or stolen. The insurance company crunches the information it has collected over decades into actuarial tables that give adjusters a quick look at the probability of just about any occurrence. You don't have those tools at your disposal so your decision will depend on your own degree of comfort in assuming a certain level of risk.

Experts recommend that if you have a lot of assets, you should get enough liability coverage to protect them. Let's say you have $50,000 of bodily injury liability coverage but $100,000 in personal assets. If you're at fault in an accident, attorneys for the other party could go after you for the $50,000 in medical bills that aren't covered by your policy.

General recommendations for liability limits are $50,000 bodily injury liability for one person injured in an accident, $100,000 for all people injured in an accident and $25,000 property damage liability (usually expressed in insurance shorthand as 50/100/25). Here again, let your financial situation be your guide. If you have no assets that an attorney can seek, don't buy coverage unnecessarily.

Your driving habits might also be a consideration in determining the coverage you need. If your past is filled with crumpled fenders, or if you have a lead foot, or if you make a long commute on a treacherous winding road every day, then you should get more complete coverage. Collision coverage pays for damage that your car experiences in an accident or damage from hitting an inanimate object (a tree, light post or fence, for example). Comprehensive coverage addresses the damage that didn't occur in a collision — such as from fire, theft or flood. It also covers damaged windshields.

Keep in mind that you don't have to buy collision and comprehensive coverage. Let's say your vehicle is older, you have a good driving record and there is little likelihood that your car would be totalled in an accident, but a high likelihood of it being stolen. Then you could buy comprehensive coverage and skip the collision insurance.

Step 2: Review Your Current Insurance Policy
Read through your current policy or contact your auto insurance company to get the information you need. Jot down the amount of coverage you have now and how much you are paying for it. Take note of the yearly and monthly cost of your insurance, since many of your quotes will be given both ways. Now you have a figure to beat.

Step 3: Check Your Driving Record
You should know how many tickets you have had recently. If you can't remember how long that speeding ticket has been on your record, check with your state's department of motor vehicles. If a ticket or points you earned are about to disappear, thus improving your driving record, wait until that happens before you get quotes. Nothing drives up the price of insurance like a bad driving record.

Step 4: Solicit Competitive Quotes
Now it's time to start shopping. Set aside at least an hour for this task. Have at hand your current insurance policy, your driver license number and your vehicle registration. You can begin with online services. If you go to an online site to get a quote for an insurance rate, you can type in your information and begin to build a list of companies for comparative quotes. Keep in mind that not all insurance companies participate in these one-stop-shopping sites, however. If a recommendation from friends and family or other research points to a company that you think might be a winner, you can go directly to its Web site or call its toll-free number to get a quote.

Each quote form takes about 15 minutes each to complete. It might be well worth your time since if the entire shopping process takes you two hours and you save $800, you're effectively earning $400 an hour.

When you use these sites, you might not get instant quotes. Some companies may contact you later by e-mail. Some that are not "direct providers" might put you in touch with a local agent, who will then calculate a quote for you. (A direct provider like Geico sells insurance policies directly to consumers. Other companies, such as State Farm, sell insurance through local agents.) You can learn more about the various kinds of agents here.

Step 5: Gather Quotes and Company Information
While you're researching companies, take careful notes so you can easily make price and coverage comparisons. Keep a list of:

 

    • Annual and monthly rates for the different types of coverage. Make sure to keep the coverage limits the same so you can make apples-to-apples comparisons for cost and coverage.
    • The insurance company's 800 telephone number, so you can get answers to questions you couldn't find online.
    • The insurance company's payment policy. When is the payment due? What kinds of payment plans are available? What happens if you're late in making a payment?

 

In later steps, you'll add some more information to this list.

Step 6: Work the Phones
Once you have gathered information online, it's time to work the phones. Contact those companies from which you haven't been able to get an online quote. Doing the research by phone can actually be easier and faster than on the Internet, provided you have your driver license and vehicle registration close at hand. When you get a quote over the phone, be sure to confirm the price by asking the representative to e-mail the quote to you.

Step 7: Look for Discounts
When you're making these calls and shopping online, make sure you explore all your options relating to discounts. Insurance companies give discounts for such things as a good driving record, your car's safety or security equipment and certain occupations or professional affiliations. Some companies are now offering lower rates if you enrol in "pay as you drive" plans. Some will give substantial discounts for young drivers in the family who have high grade-point averages. (You can use this as an incentive to your teen drivers and offer to share the savings with them.) Also, consider using the same insurance company for home and auto policies. That will usually get you a better price. For more guidance on discounts, check out "How to Save Money on Car Insurance" and "Top 10 Ways To Lower Your Car Insurance Bill."

Step 8: Assess the Insurance Company's Track Record
You now have most of the price and coverage information that you need to make a decision. You can see which company's coverage is least expensive, but it's important to keep in mind that cheap isn't the only basis for choosing an insurer. How do you know which company is financially sound? How do you find out if an insurance company is going to treat you right — particularly in the event of a claim?

Here are some places to check to develop a clearer picture of an insurance company's track record for fairness, financial stability and customer service.

1. Use the National Association of Insurance Commissioners' Consumer Information Source to access information about insurance companies, including closed insurance complaints, licensing information and key financial data. You also can visit your state's department of insurance to check consumer complaint ratios and basic rate comparison surveys.

2. Consider contacting an independent insurance agent for additional information about a company.

3. Check out the financial strength ratings for an insurance company by referring to the ratings from A.M. Best and Standard & Poor's (registration may be required).

4. Review consumer satisfaction surveys from J.D. Power and Consumer Reports (subscription required).

5. Ask friends and family about their insurers and whether they're satisfied with them. In particular, ask them how their insurance companies treated them if they had a claim. Did they get fair, straightforward service? Or was it a hassle to get the matter resolved?

Step 9: Review the Policy Before You Sign
When you're done your research and zeroed in on a company, read over the main points of the policy. In addition to verifying that it contains the coverage you've requested and priced, it's a good idea to find out if the policy states that "new factory," "like kind and quality" or "aftermarket parts" may be used for body shop repairs, says Dennis Howard, director of the Insurance Consumer Advocate Network. If the policy has such a requirement, think hard about whether this is the company for you, particularly if you own a relatively new car that you plan to keep for a while. In this case, it's best to know at the outset that the insurer will pay for original manufacturer parts, rather than try to fight later when you have a claim.

Step 10: Cancel Your Old Policy; Carry Your Proof
After you have secured the auto insurance policy you want, cancel coverage with your existing insurance company. If your state requires you to carry proof of insurance, make sure you put the card in your wallet or the glove compartment of your car.

Finally, here's a quick checklist to keep you on track:

 

    • Determine your state's minimum insurance requirements.
    • Consider your own financial situation in relation to the required insurance and consider whether you need to increase your limits to protect your assets.
    • Review the status of your driving record — do you have any outstanding tickets or points on your driver license?
    • Check your current coverage to find out how much you are paying.
    • Get competing quotes from Internet insurance Web sites and individual companies of interest to you.
    • Make follow-up phone calls to insurance companies to get additional information about coverage.
    • Inquire about discounts.
    • Evaluate the reliability of the insurance companies you're considering by visiting your state's insurance department Web site, reviewing consumer surveys and talking to family and friends.
    • Review the policy before finalizing it. Remember to cancel your old policy.
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