American Auto Shield develops and administers a selection of vehicle service contracts with various coverage options depending on your needs and budget. Although each contract differs in its level of coverage, the optional coverage each offers can make a huge difference in your covered repairs down the line.

For instance, a mechanical breakdown policy without the Wear and Tear option will not cover parts worn but not broken. Therefore, if a part is obviously worn but has not failed, the breakdown policy will not cover the replacement of the worn part. The more miles on a car when a repair becomes necessary, the more likely it is that the repair will be needed because a part wore out, rather than because the part broke due to poor manufacturing.

Allow me to illustrate: your mechanic determined one of your lifters is broken, and the other three are worn and will most likely fail soon. A vehicle service contract with the Wear and Tear coverage option may replace the broken lifter and the three worn lifters if they are worn from normal use. A mechanical breakdown policy will only pay to have the one broken lifter replaced.

Many claim denials are due to “Normal Wear and Tear” situations. Those that purchase mechanical breakdown policies assume their policy will pay for these repairs since those parts are not listed in the “Exclusions” section. Consequently, most are extremely disappointed when their claim to replace or repair those parts is denied because “Normal Wear and Tear” is listed as an “Exclusion” in the policy. That’s why we can’t stress enough – review your policy before purchase. Often you don’t think to ask these things on the phone, but by reading through the contract you can take the time to figure out if it’s going to offer you the coverage you need. If it doesn’t, the company you’re working with may be able to provide a different policy that better suits you or, like American Auto Shield, it may provide supplemental coverages to enhance a policy you’re interested in. If they can’t, it’s time to research other companies and coverage.

Does your warranty or vehicle service contract cover your repairs anywhere and at any professional repair facility? Make sure you know before you make your purchase. Many extended warranties require you have your vehicle serviced at the dealership where it was purchased. In addition, many auto service agreements require you to take your vehicle to their authorized shops for repairs. Either can be a huge hassle when you’re stranded along the road with your family, you can’t find an authorized dealer or shop within a 100 mile radius, and little Molly is crying because you can’t get to Disneyland.

While a breakdown policy can be beneficial and a Wear and Tear policy is optimal, it is a mistake to assume that any policy will cover every repair your car may need. In most cases, a warranty or a vehicle service contract will require that the vehicle has been maintained according to the manufacturer’s schedule. In addition, allowing a vehicle to overheat and hard driving can negate a warranty or service agreement. Mechanics generally recognize the signs that a vehicle has been abused. Most auto warranties and vehicle service contracts will not cover negligence or abuse on the owner’s part. If you service your vehicle regularly and aren’t pushing your vehicle beyond its intended limits, your valid repairs should be covered…and you’ll extend the life of your vehicle! To find out how to avoid denied claims due to negligence and abuse, click here.

Terms exist to protect the warranty or service contract provider from unreasonable expenses and the purchaser from unreasonable costs to buy coverage, so it’s extremely important that you follow the terms to maintain that coverage. If you service your vehicle regularly and aren’t pushing your vehicle beyond its intended limits, your valid repairs should be covered…and you’ll extend the life of your vehicle.

The 2 most common reasons an auto warranty or a vehicle service contract claim can be denied are:

1. Negligence – In most cases, an auto warranty or service agreement will require that the vehicle has been maintained according to the manufacturer’s schedule. If it’s not performed on schedule, the auto dealer may deny future claims on your warranty. However, if regular maintenance and service (like oil changes) are performed, your repairs should be covered under the terms of your vehicle service contract and you should be back on the road, for less in many cases.
2. Abuse – Hard driving and pushing a vehicle beyond its intended limits can negate a warranty or service agreement. Mechanics will generally recognize the signs that a vehicle has been abused. In the drive train, abuse often results in distinctive forms of wear on the parts. Running the engine too hard is usually also apparent by the types of damage it inflicts. Driving conservatively will ensure your valid repairs will be covered.

You purchased a vehicle service contract because you care about the life of your vehicle. So take care of your vehicle – and your policy will take care of you! To learn more about maintaining and protecting your vehicle, click here.