1. Automobile breakdowns
Vehicle breakdowns are hard to anticipate. Some drivers buy mechanical breakdown insurance or extended repair warranties for added peace of mind.
Mechanical breakdown insurance is supplemental insurance that covers repairs unrelated to accidents.
An extended auto warranty covers repairs after factory warranties have expired. The items such warranties protect vary, but they typically exclude wear-and-tear and routine maintenance, such as replacing tires, notes U.S. News & World Report.
Some warranties are backed by vehicle manufacturers and others are backed by car dealers or warranty companies.
Money Talks News founder Stacy Johnson weighs the pros and cons of extended repair warranties in “Ask Stacy — Should I Buy an Extended Car Warranty?”