Tire Insurance: Myths and Facts About Road Hazard Policies

Insurance--it's everywhere. One can insure just about anything. Are tires an investment one needs to insure? Tire insurance, also called a road hazard policy, road hazard warranty, or tire refund plan, is a rapidly growing commerce in the automotive world.

Tire warranty plans pay in full or in part for the exchange or mend of damaged tires and/or rims from "road hazards." Road hazards are defined as pot holes, debris, nails, wood, and other hazards found in the road. Curbs, sidewalks, and stone walls are not road hazards. This is an important disagreement to think when deciding if tire assurance is right for you (discussed added ahead).

Nationwide Home Insurance

Tire plans last for a specific duration of time and tire wear tread-depth. Some plans last 2-3 years. Others can last 5 years or 60,000 miles. Any plans come with fixed amounts of coverage: 0 per year up to 4 years. Many contracts require three years of law school to comprehend. In terms of tread depth, a tire is normally carefully worn out (and thus the plan null and void) at 2/32 to 3/32 of an inch.

Another important disagreement is in the type of plan.

Tire refund plans are just what they say. You, the plan holder, will be reimbursed after the claims process is finalized--usually 2-8 weeks. There is an out-of-pocket expense. These plans are often sold by new car dealerships. The prices can range from 0 to 0 dollars.

Road hazard policies control similarly to refund plans. However, some tire assurance providers, in partnership with the mend facility, may have a direct-pay relationship. Thus, there would be no out-of-pocket expense, except for applicable deductibles, and items not covered in part or in full. These plans are primarily sold by tire dealers and mend shops. The prices range from to per tire. They also can be based on a ration of the cost of the tire: normally 12% to 15%.

Both types of plans have a estimate of variables, requiring a magnifying glass to read the fine print. Also, many are pro-rated warranties, exterior only a ration of the cost of the tire based on its wear.

Claims and Coverage

Depending on the plan, claims are initiated by the mend shop. The process is fairly smooth, although there can be a critical delay from the provider for authorization. This delay may be an hour or an entire weekend. This means that you'll have to "ok" the tire replacement, and then hope it's authorized for the full amount, or drive on your spare.

Some plans offer national coverage whether among their aid facilities or from other mend centers. Claims procedures will vary. Others only provide local coverage, or coverage at the selling facility.

Limitations

Tire assurance does not mean that everything is covered. Pro-rated warranties are based on the wear and tear of the tire. You may get 75%, 50%, or only 10% coverage depending on the tread-depth. You'll pay the remainder. While there are plans that offer full coverage, even these have limitations, or they may friction with a mend shop's policies.

For example, many plans allow for a maximum of to mount and equilibrium one tire, and a maximum of to mend a tire. However, sport tires often have significantly higher mounting and balancing fees--upwards of per tire--and tire mend prices can exceed . There are also discrepancies on the tire and rim prices themselves, which in the end, may have to be supplemented by the aid customer.

Although there normally is not an issue with the latter given the contentious market, the aid center's price mark up may be unacceptable to the plan provider. In this case, the aid center needs to lower the price or you, the aid customer, need to pay the difference--or go somewhere else. This does happen!

Rim exchange and Repair

Rim exchange is becoming less frequent. With the high cost of aluminum wheels and sport wheel packages, tire insurers have opted to have them repaired. mend will only be done if the rim does not hold air. What this means is that even if the rim is warped--enough to cause a vibration and even premature tire wear--they won't replace it. Rather, they will send it out to be straightened and repaired.

Rims are supplanted only if the damage is so overall that the new tire, when mounted on the rim, won't hold air. However, even in this case, especially if it's an costly sport wheel, they may still effort to mend it.

Repairing rims is a bad option. While some rim mend is acceptable, badly warped or damaged rims will in no way ever be the same.

Alignments

If a car hits a road hazard hard enough, such as a pot hole, it's wise to have the alignment checked. Road hazard policies and tire refund plans do not cover alignments. The aid buyer will have to pay for this procedure.

Road Hazard protection Positives

Some plans include tire rotations, wheel balancing, and nationwide coverage.

Myths

Can I pop all 4 tires and get a new set of tires?
You can try. But this type of claim will trigger a estimate of red flags with the insurer. The course possessor will likely send out adjusters and/or require photographs. You will also have a difficult time explaining how a "road hazard" caused all 4 tire pop.

New tires come with a warranty.

New tires do come with a warranty by the tire manufacturer (Michelin, Yokohama, Goodyear...etc), but not a road hazard warranty. The warranty by the tire manufacturer only covers defects in workmanship. New tire warranties do not cover punctures or damages from external sources. This is why "road hazard" protection is being pushed.

New tires are rarely defective. If there is a problem, it's normally noticed when balancing the tire. Or, there is a drivability concern such as vibration or noise. If there's a fault it's generally caught right away, and the tire swapped out.

It's so cheap; it's a no-brainer, right?

Actually, the experts don't agree with this statement.

The Economics of Tire Warranties

An report from the Washington Post by Terence O'Hara explains the economics of extended warranties and purchase protection plans in general. It is quite fitting for road hazard warranties. He writes:

The decision to buy an extended warranty...defies the recommendations of economists, consumer advocates and product quality experts, who all warn that the plans rarely benefit consumers and are nearly all the time a waste of money.

'[Extended warranties or purchase protection plans] make no rational sense,' Harvard economist David Cutler said. 'The implied probability [of having an issue with the product] has to be substantially greater than the risk that you can't afford to fix it or replace it. If you're buying a 0 item, for the overwhelming estimate of consumers that level of spending is not a risk you need to insure under any circumstances.'

In short, road hazard warranties are a waste of money. Don't insure that which you can afford to replace.

Numbers Game and Slim Chances

Like all insurance, tire assurance plans are a numbers game. However, this is a game you have a 98% occasion of losing. Insider statistics show that the ration of claims paid out by providers is as low a 2%.

Curbs

Another spirited note is that a lot of tire damage is caused by curbs. Curb damage is not covered under most road hazard policies. High granite curbs with sharp edges slice straight through tens of thousands of tires per year.

You Won't Notice

Many citizen don't even consideration tire damage. Other than to see if the tires are retention air, who "really" looks at tires? Tires are subject to a whole host of external influences which cause bubbles, slices and gouges. Despite the inherent dangers of damaged tires, the damage very often does not translate into any noticeable drivability issue. The point is that if you don't consideration any tire damage you can't benefit from the coverage.

Research Shows

Those raving about the benefits of a road hazard course are the actual folks in the commerce who stand to benefit from the sale. They'll argue that it's so cheap--only to per tire. Even so, for four tires, that's based on the "possibility," the "chance," of damaging a tire that meets the repair/replacement requirement protocols.

Auto Insurance

If a rim and tire has incurred critical damage, it's quite likely that other problems have resulted as well. The first is that the car may have been jarred out of alignment. Secondly, hub bearings, front end components: tie rods, spindles, ball joints, and a range of other components may have sustained damage. In this case, auto insurance, which you are already paying for, will pay for everything--brand new.

Free Road Hazard Warranties

Many tires come with road hazard warranties Free. In other words, in an effort to fetch retailers, many tire distributors provide aid centers Free road hazard insurance. Some shops pass this on to their tire customers, others sell them. Ask if the tire "comes" with a road hazard protection policy. If not, ask that one be in case,granted at no added charge. It's worth a shot.

Also, some car manufacturers provide road hazard warranties Free of payment for 12 months or 12,000 miles. If you're buying a new car or even used, ask that the dealer provide a complimentary road hazard course (after all the wheeling and dealing is done, of course), and just before you commit.

What's the best road hazard policy?

Money in your bank account.

Tire Insurance: Myths and Facts About Road Hazard Policies