Car Repairs and Auto Insurance

Find tips on getting your automobile repaired and getting car insurance.

Auto Insurance

Auto insurance protects you from paying the full cost for vehicle repairs and medical expenses due to a collision. A number of things affect the premiums you pay for this protection, including your:

  • Gender
  • Age
  • Marital status
  • Credit history
  • Car's make and model
  • City and neighborhood

Types of Auto Insurance

Every state requires drivers to carry minimum levels of auto insurance coverage, or the equivalent in financial responsibility waivers. These requirements ensure that you can pay for property damages or medical expenses. There are several components that can make up your insurance policy: 

  • Liability coverage protects you if you are at fault for a collision. It pays for medical expenses and vehicle damage for the other driver and passengers. 
  • Uninsured motorist coverage pays for damages to your car and medical expenses if an uninsured driver hits your car.
  • Collision coverage pays to repair your vehicle, if you were at fault for the collision.
  • Underinsured motorist coverage pays damages for your car if someone hits it, but doesn’t have enough insurance to cover your medical expenses and car damages.
  • Comprehensive coverage pays for damages to your car due to theft, fire, or falling objects.

Auto insurance requirements vary from state to state, but liability coverage is mandatory in most states. You may choose to opt out of certain types of coverage, depending on your budget and car’s age. Check with your state insurance regulator to learn more about its requirements and to research potential insurers. 

Be sure to read the declarations page of your auto insurance policy. This summary includes your policy’s important details: the duration of coverage, annual premium, the maximum amount your insurance company will pay out for each type of claim, and how your premium payment is split between each part of your coverage. 

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Car Repossessions

When you borrow money to buy a car or truck, the lender can take your vehicle back if you miss a payment or in some other way violate the contract. If have missed payments, your lender:

  • can repossess with cause without advance notice
  • can insist you pay off the entire loan balance in order to get the repossessed vehicle back
  • can sell the vehicle at auction
  • might be able to sue you for the difference between the vehicle's auction price and what you owe (depends on the state you live in)
  • cannot break into your home or physically threaten someone while taking the vehicle

If you know you're going to be late with a payment, talk to the lender to try to work things out. If you and the lender reach an agreement, be sure you get the agreement in writing. Contact your state or local consumer protection office to find out whether your state gives you any additional rights. The Federal Trade Commission offers more detailed information about vehicle repossessions.

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Complaints about Cars

If you have a complaint about your car, file it directly with the dealer, lender, or manufacturer. If you don't get results, you can contact a state or federal government agency.  If your complaint is about:

Some agencies will investigate your complaint, but others may collect the information and file a case against the company in the future. 

Lemon Laws

A car is called a "lemon" when it's determined that the vehicle is defective beyond repair. Most states have some form of a lemon law to protect car buyers. These laws tend to only apply to new cars, but you should check with your state's consumer protection office to see if they also cover used cars. Each state has its own requirements, but overall the ability for a car to qualify as a lemon depends on a few things:

  • Number of miles driven -- The defects had to happen within a certain number of months or miles driven.
  • Substantial defects -- Defects have to be major, and involve the actual operation of the car, such as the initiation, brakes, engine, transmission, or other major parts of the car.
  • Reasonable repair attempts -- You have to give mechanics multiple chances to repair the problems.
  • Number of days in the shop -- Your car has to have been in the mechanic's shop for a significant number of days, (generally 30 days or more) within a year.

To get your problem resolved, first contact the car manufacturer. Send the manufacturer a complaint letter by certified mail detailing the problems, copies of work orders and invoices, and your request for a refund or other solution. If the manufacturer doesn’t help, you still may be able to resolve the problem. Many car contracts have mandatory arbitration clauses to settle disputes, so that may be your next step. Check with your state attorney general or consumer protection office to get the rules specific to where you live.

You can also contact the Better Business Bureau (BBB) AUTO LINE, a lemon law complaint program that covers car warranty issues against participating manufacturers.

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Recalled Products

Learn what recalls are and where to go to find out about recalled products.

A recall is an action taken by a manufacturer, or the government, to protect the public from products (such as medications, food, vehicles, child safety seats, cosmetics, and more) that may cause health or safety problems.

Some recalls ban the sale of an item, while others ask consumers to return the item for replacement or repair. Sometimes, a seller will provide a part that reduces the danger of using the product.

Before you buy a product, especially a used or secondhand one, be sure to check that the manufacturer has not recalled it. If you are buying a product for a child, such as toys, clothing, cribs, and costume jewelry, be especially careful. Visit these websites to find the latest on safety recalls:

  • Recalls.gov lists government-initiated recalls from federal agencies. You can sign up for free e-mail notifications on recalls.
  • Safercar.gov publishes safety information on vehicles and equipment such as children's car seats.
  • FSIS.USDA.gov lists recalls that involve meat, sausage, poultry, and processed egg products.
  • FDA.gov lists recalls that involve food (non-meat products; fruits; vegetables; seafood; shelled eggs; infant formulas), medicines, medical devices, cosmetics, biologics, radiation emitting products, veterinary drugs, and pet food.
  • Foodsafety.gov publishes notices of food recalls and alerts from both the Food and Drug Administration (FDA) and the U.S. Department of Agriculture (USDA).
  • SaferProducts.gov allows you to report incidents and safety concerns with consumer products, and search for incidents reported by other consumers.

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Vehicle Repair Shops

In order to avoid auto repair rip-offs, be prepared. Knowing how your vehicle works and how to identify common car problems is a good start. It is also important to know how to select a good mechanic, the kinds of questions to ask, and your consumer rights.

For information on how to choose a repair shop or technician:

  • Auto Repair Basics helps you choose the right repair shop or technician, understand repair charges, practice preventative maintenance, and more.
  • The Motorist Assurance Program is a nonprofit that gives its seal of approval to qualified repair shops.

If you would like to file a complaint against a mechanic or repair shop, contact your state consumer protection office, your local Better Business Bureau (BBB), or your state motor vehicle agency.

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Warranties

A product warranty is the promise that a manufacturer or seller makes to stand behind a product's quality. Federal law requires that warranties be available for you to read before you buy, even when you are shopping by catalog or on the Internet, so that you can comparison shop. A standard warranty is part of the item you purchased, and there is no additional cost for this protection from the company. There are three main types of warranties:

  • Written warranties are printed and come along with the item you purchased. In order for a written warranty to take effect or to make a claim against it, the seller or manufacturer may require you to perform maintenance or use the item as instructed.
  • Spoken warranties are spoken by a salesperson, or other staff at a retailer or service provider, for services like free repairs. If you receive this kind of warranty, have the person who gave it and their manager put it in writing. Otherwise, you may not be able to get the service that was promised to you.
  • Implied warranties promise that the item you purchased will do what it is supposed to do and that it can work under the circumstances that it was designed for. These warranties are created by state laws, and are not specifically stated or written.

If you purchase an item and it doesn't have a written warranty, it is still covered under the implicit warranty laws in your state, unless it was marked "as is" when you purchased it.

Service Contracts

Service contracts or “extended warranties” extend the guarantee or promise that a product will work, and are purchased for an additional cost. Sellers offer these service contracts at the time of purchase, and sometimes months or years after your purchase. They are commonly offered when you buy a car, major electronics, or household appliances. Third party firms (not the manufacturer or the seller) may also try to sell you an extended warranty; some even make cold calls to you with high pressure sales tactics. Some extended warranties duplicate the warranty coverage that you get automatically from a manufacturer or seller. These add-ons may not be worth the cost. Ask these questions before you agree to one of these contracts:

  • Does the dealer, the manufacturer, or an independent company back the service contract?
  • How are claims handled? Who will do the work and where will it be done?
  • What happens to your coverage if the dealer or administrator goes out of business?
  • Do you need prior authorization for repair work?
  • Are there any situations when coverage can be denied? You may not have protection from common wear and tear. And some manufacturers do not honor contracts if you fail to follow their recommendations for routine maintenance.

Problems with Warranties

If you have problems receiving the services that were promised in your warranty, you can report your dispute. First read your warranty to make sure you know your rights. Then you can file a complaint with the retailer; if the retailer can't help, contact the manufacturer. If neither the retailer or manufacturer can help, file a complaint with your local consumer protection agency.

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