Car insurance is mandatory in the UAE and owners can choose from an array of options. While buying insurance, one term that is often misunderstood is the car warranty. Car warranties and car insurance are two different types of financial assistance targeting varied perspectives. Where insurance covers damages, warranties are more useful for repairs. Besides the coverage, there are multiple other differences between the two.
Here, we have elaborated on car warranty vs. insurance in detail, which can help you select the appropriate assistance for your vehicle.
Difference Between Car Warranty and Car Insurance
The car insurance coverage in the UAE is comprehensive and even owners can opt for add-ons. Despite the coverage, in certain cases, car insurance is limited. This is when the car warranty steps in.
The comparison between car warranty vs insurance highlights their distinct roles in protecting vehicle owners.
Car Warranty vs Insurance Comparison: Definition
In the UAE, car insurance is a mandatory financial plan that covers liabilities, losses or damages due to an accident or any other incident. The coverage varies depending on the type of insurance like the comprehensive or third party insurance that the owner holds.
On the other hand, a car warranty in the UAE is backed by a manufacturer or dealer that only covers specific auto parts that malfunction due to manufacturing defects. The car warranty is limited to a time period or distance travelled.
Car Warranty vs Insurance Comparison: Types
There are different types of car insurance, each covering different auto parts. The most common type of car insurance includes the following.
- Comprehensive Insurance
- Third-party Liability Insurance
- Off-road Insurance
- Gap Insurance
- Classic Car Insurance
- Totalled Car Insurance
The types of car warranties in the UAE are as follows.
- Corrosion Warranty
- Emission Warranty
- Bumper-to-bumper Warranty
- Extended Warranty
- Powertrain Warranty
- Drivetrain Warranty
Car Warranty vs Insurance Comparison: Inclusions
The inclusions of car warranty vs insurance are different. Let’s first start with the inclusions of car insurance mentioned below.
- Coverage for injuries, legal liabilities or damage caused to another person’s vehicle
- Covers loss due to accident, theft and fire
- Provides towing and roadside assistance
- Pay for the windscreen and engine damage
In comparison to insurance, the inclusions of car warranties are slightly different.
- Repairing or replacing car engine components, transmission system and drivetrain.
- Any malfunctioning in electrical, mechanical, fuel or safety systems is also covered by a car warranty.
- Limited coverage of technology and infotainment systems of a car is also provided.
Car Warranty vs Insurance Comparison: Exclusions
Car insurance in the UAE excludes any damage that is caused intentionally or when the driver is under the influence of drugs or alcohol when an accident happens. Unlicensed driving, non-accidental damages and involvement in racing, illegal or terrorist activities are also excluded.
Usually, regular maintenance, non-manufacturer parts, accidental damages and wear and tear are not covered by car warranties. Moreover, non-manufacturer parts and regular ageing are also excluded. Please remember that any damage caused intentionally is not covered in car warranty or car insurance both.
Car Warranty vs Insurance Comparison: Cost
The cost of car insurance in the UAE varies according to the type of insurance owners hold. Roughly estimating, the third-party insurance costs around AED 800 to AED 1500. Whereas, the comprehensive insurance starts from AED 5000, typically 1.24% to 4% of the car’s value.
Car warranties are provided by the manufacturer on the purchase of new cars for sale in the UAE. The warranty is often provided for 3 to 5 years or 60,000 to 100,000 km. Whereas, owners can buy extended insurance that can cost around AED 2000 to AED 7000.
Disclaimer: The prices mentioned above are rough estimations and can vary from the actual market prices.
FAQs
What are the main differences between a car warranty and car insurance?
Car insurance covers damages caused after an accident. Whereas, a car warranty only covers the cost of repairing or replacing certain auto parts.
Does a car warranty cover accidents like insurance does?
No, the warranty only covers certain malfunctioning car parts like the engine, powertrain and transmission.
Can I have both a warranty and insurance for my car?
Yes, insurance is mandatory by law; whereas warranty is offered by the dealer.
Does car insurance provide roadside assistance like some warranties?
Not all insurances come with roadside assistance, but you can include it by using the insurance add-ons.
This was all about car warranty vs insurance that owners must be aware of. Car insurance is mandatory by law and owners have to purchase it; whereas, a warranty is offered by the manufacturer. However, owners can buy extended warranties to ensure maximum financial protection. That said, when buying used cars for sale in the UAE, look for a vehicle that is under the manufacturer’s warranty.
Stay tuned to dubizzle’s auto blog for more information on financial coverage for cars.
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