auto insurance lemon carWhen I was researching this auto insurance blog, I posted to a question to my Facebook page: “Have you ever purchased a lemon? What did you do about it? What help were you able to get, from where, and from whom?”

The response I received? “Yes, I squeezed it into my water, it was good.”

While I was looking for some helpful advice about what to do with a dud of a car and how to minimize your losses if you wind up with one, I understand that sometimes the best way to deal with a problem is to laugh about it.

Unfortunately, it’s not that easy to deal with a car that turns out to be a lemon. It can be especially frustrating if you go into debt or take out a loan to pay for the car, but you may have some help from federal and state laws.

Federal and state lemon laws

A manufacturer’s warranty spells out the terms under which the manufacturer is legally responsible for repairs to the vehicle or other product. The Magnuson–Moss Warranty Act, which is the federal lemon law, covers a manufacturer’s breach of warranty.

The Magnuson-Moss Warranty Act protects all consumers in the country, but each state has its own lemon law as well. Your state lemon law will outline how new, used, and leased vehicles are covered. Your state attorney general’s website should have more information about your local lemon laws.

What determines if a car is considered a lemon?

We might all like to have a manufacturer pay for our regular car maintenance, but there are certain criteria that must be met for a car to be considered a lemon:

  • The number of times the car has been repaired within a certain period of time.
  • The number of days the car has been in the repair shop within a certain period of time.

In our litigious society, even if you’re entitled to damages or repairs for a lemon car, sometimes victims still have to work hard to prove their claims. Unnecessary lawsuits and false claims have increased paperwork and protocol to the extent that the victims can be treated like criminals.

If you have a legitimate lemon claim, be prepared to put in quite a bit of time and effort on it. A friend of mine recently purchased a lemon, and she said it took several months to rectify the situation. That’s a long time to be aggravated and frustrated when you have to prove your claim.

Insurance vs. warranty

Unfortunately, repeated mechanical failure is not a covered peril in an insurance policy. Remember, a warranty is a contract and insurance is a policy. A warranty protects you when maintenance is required as a result of normal wear and tear. Insurance provides coverage that replaces or repairs damage to property in the event of natural, unnatural, and accidental hazards.

How to identify the history of a used car

Most dealerships market their inventory of used vehicles as “certified pre-owned.” This means the dealer certifies that the car has been reconditioned and inspected and that it is warrantied by the manufacturer. This certification may provide the consumer an extra layer of reassurance because any lemon law claims are made to the manufacturer, not the dealer.

As a consumer, you can also do your own research to find out the history of a used car. To start, you can check out CARFAX, a vehicle research site. With CARFAX, you can use a Vehicle Identification Number (VIN) to search the database for the full history of any vehicle.

If you’re a member of AAA, you can get a discount on a CARFAX report, but even if you have to pay full price, it’s worth the cost of avoiding the pain of a lemon car.

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Linda Rey is a licensed insurance agent at Rey Insurance with a broad spectrum of expertise in life, accident, health, property and casualty insurance as well as retirement planning and college funding strategies.

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