Purchasing protection coverage

[Stacyg]

Is it worth it to buy hazard insurance for tires and rims and if so why would be a good price. What about gap insurance? How do they base that cost?

 

[markjenn]

Tire/rim insurance is seldom "worth it" as the amount paid in premiums is, by definition, more than the amount paid out in claims - if it wasn't so they wouldn't make any money on it and they wouldn't be pushing so hard to sell it. In fact, given that this is one of the high-profit-margin items typically sold at the last-minute during vehicle closing when your guard is down (with around 50% of the policy value going directly to the dealership as pure profit), the amount paid in claims is usually MUCH lower than the premium costs. Bottom line: You're better off keeping the premiums in your pocket and taking the risk. That being said, insurance does buy peace of mind and if you're going to lose sleep worrying about the cost of replacing a wheel, then maybe it is worth it to you to get as good night's sleep.

Gap insurance is something to consider if you're significantly "underwater" in your loan/lease and paying off the difference if the car is totalled would be be a financial hardship. Here again, you're really better off just not being underwater to begin with even if this means getting less car or putting more money down.

Prices for these sorts of things are "whatever they think you'll pay" and are negotiated. Negotiate hard as they're high profit items. You don't necessarily even have to buy this sort of insurance at the time you buy the car - you can usually shop around later and get competing bids.

- Mark

 

[Stacyg]

Tire/rim insurance is seldom "worth it" as the amount paid in premiums is, by definition, more than the amount paid out in claims - if it wasn't so they wouldn't make any money on it and they wouldn't be pushing so hard to sell it. In fact, given that this is one of the high-profit-margin items typically sold at the last-minute during vehicle closing when your guard is down (with around 50% of the policy value going directly to the dealership as pure profit), the amount paid in claims is usually MUCH lower than the premium costs. Bottom line: You're better off keeping the premiums in your pocket and taking the risk. That being said, insurance does buy peace of mind and if you're going to lose sleep worrying about the cost of replacing a wheel, then maybe it is worth it to you to get as good night's sleep.

Gap insurance is something to consider if you're significantly "underwater" in your loan/lease and paying off the difference if the car is totalled would be be a financial hardship. Here again, you're really better off just not being underwater to begin with even if this means getting less car or putting more money down.

Prices for these sorts of things are "whatever they think you'll pay" and are negotiated. Negotiate hard as they're high profit items. You don't necessarily even have to buy this sort of insurance at the time you buy the car - you can usually shop around later and get competing bids.

- Mark

Thank you for the advice I did look into it more and what I really wanted it to cover was my rims because I hit curbs all the time lol it doesn’t really cover that kind of damage so that’s out for sure. Still up in the air about the gap insurance. We once bought my son a new car and he totaled it in 8 months the depreciation was crazy and we were out thousands of dollars. I don’t remember all the details there was only a small loan and we had put a lot of cash on it. They gave us at least 6 thousand less than what we paid . I am not sure how it works exactly so I will do some more research .

 

[jw_tx21]

Thank you for the advice I did look into it more and what I really wanted it to cover was my rims because I hit curbs all the time lol it doesn’t really cover that kind of damage so that’s out for sure. Still up in the air about the gap insurance. We once bought my son a new car and he totaled it in 8 months the depreciation was crazy and we were out thousands of dollars. I don’t remember all the details there was only a small loan and we had put a lot of cash on it. They gave us at least 6 thousand less than what we paid . I am not sure how it works exactly so I will do some more research .

If you want gap insurance, it may be cheapest to purchase from your auto insurance company.

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[boatman]

Stacy’s-
Your story should be a cautionary tale to the forum members paying the crazy “market rate adjustment” prices. If 10 months into their loan and total the new Telluride, the ugly reality of depreciation would leave many buyers in a very unfortunate situation.

 

[Stacyg]

Stacy’s-
Your story should be a cautionary tale to the forum members paying the crazy “market rate adjustment” prices. If 10 months into their loan and total the new Telluride, the ugly reality of depreciation would leave many buyers in a very unfortunate situation.

Absolutely! Luckily I will not be one of those people. I am paying msrp though and not putting much down this will be my first purchase in many years so unfortunately I don’t have a trade in. If that were to happen of course I would be able to afford the loss but who wants to lose the money. In our case with our son the loan was paid off but we were out a large chunk of cash. Insurance companies dictate what the car is worth at time of accident. New cars take the biggest hits if it were a used car I don t think it would make a big difference. Anyway yes I called my insurance guy with the vin so he can make the changes and asked him to look into the cost of gap today. I am heading to pick up my sxp copper black with dune interior! So excited!

 

[badpewterz]

for me and at my dealer the tire/wheel protection is 349 for 3 years (length of the lease) and well worth it as it covers the rims and tires from scuffs up to full on pothole carnage. and with one little scuff that at turn in would cost you or one pot hole your covered for way less than buying a new rim and or tire.

as for GAP. if you LEASE it is already included in the contract per kia ( and most other manufactures for that matter) this is NOT an extra charge nor should ANY GAP be added to a lease.
as for a purchase and seeing most are going for msrp or more thats up to you. it covers what the insurance company will not in a total loss. BUT like others have stated your own insurance company probably has a better deal on it

 

[raydog9379]

Wheel, Tire, and Dent/Ding is usually BS. In the above posters case, $349 it's worth it at that point. I paid about $1,250 once and only ever had 1 tire replaced under it in 5 years of it's effectiveness. So of my $1,250 I laid out up front at purchase, I got $250 worth back. I of course didn't get any dings until after it was expired. Even then though, the plan I had covered only 2 times for repair and 2 quarter size or smaller dings per instance. That isn't much really now that I know. I now have a paintless dent guy that comes to the house and does $75/panel no matter how many dings....true miracle worker there with what he did on one of my cars that my wife hit the side of the garage with (saved me over a grand easy on a re-skin of a door).

Moral of the story... if it's relatively inexpensive, then ok it makes sense. If you lay out much more, then think about the cost of a tire and/or rim. Also, nails/screws in tires most of the time Discount Tire repairs for free if it's repairable even if you didn't buy tires there. Otherwise when you get new tires down the road, go to Costco or Discount Tire or any other and get the road hazard (DT calls it "certs") which is much cheaper.

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[Stacyg]

Declined the tire it was more than the gap insurance that I did get for 750. Total replacement coverage I also purchased a gold plan for 10 years bumper to bumper for 1100. Sounded reasonable to me. Any thoughts ?