If you’re thinking about buying an extended warranty for your car, be sure to read the fine print. These contracts, also known as vehicle service contracts, are often marketed by dealerships and third-party companies.
They can be expensive, but they may be worth it if you need peace of mind to sleep at night. However, you should ask five questions to decide if the purchase is right for you.
Cost
There are several factors that can affect the cost of an extended warranty. First, you need to understand how the coverage works. Typically, extended warranties include a deductible and maximum payout amounts. Some also include roadside assistance and rental car coverage. You should always compare quotes before making a decision. Moreover, avoid buying extended warranties from fly-by-night companies or dealerships. You can find more affordable plans online or from independent providers.
A good rule of thumb is to calculate your average annual mileage and how long you plan on owning the vehicle before buying an extended warranty. In addition, you should read the policy thoroughly to ensure that it covers your specific needs. For example, a policy that excludes transmission repairs doesn’t make much sense. Lastly, you should consider the dealership’s offer, which is often offered at a discounted price to buyers and may be rolled into your financing costs. This could make your purchase more expensive than necessary.
Coverage
If you are considering buying an extended warranty for your car, it’s important to know what coverage it provides. Most warranties will include a deductible, which you must pay before the warranty will cover repairs. In addition, many extended warranties exclude parts that wear out as a result of normal usage and other factors.
You can also check the company’s reputation online. Look for reviews that emphasize customer service and speed of repairs. Avoid a company that has multiple negative reviews.
You should try to purchase an extended warranty before your original manufacturer’s warranty expires. Extended warranties from the carmakers (also known as original equipment manufacturers or OEMs) usually mimic the factory warranty and offer added benefits like roadside assistance. They are also usually less expensive than third-party warranties. However, third-party warranties may have stipulations that you’re not comfortable with. For example, some will exclude parts that are worn out due to normal usage or owner abuse.
Expiration date
When choosing an extended warranty, be sure to read the contract terms carefully and compare quotes from several companies. Make sure you know what coverage you’re getting and are aware of any stipulations or exclusions, such as wear-and-tear items, maintenance, and non-manufactured parts. ConsumerAffairs reviews indicate that most consumers who purchased extended warranties are happy with their decision, though some have complained of problems with the company or the contract.
It’s best to buy an extended warranty before your original manufacturer warranty expires. Purchasing one afterward can be more expensive and may not cover the parts that need replacement. It’s also important to consider the amount of miles you drive each year. Typically, the extended warranty will last for a certain number of years or miles on your odometer, whichever comes first. Some of these warranties offer roadside assistance and towing, which can be helpful if you’re in an accident. Others include replacement parts and rental car reimbursement.
Transferability
Depending on the type of warranty you purchase, you may be able to transfer it to a new owner. However, this process is not always straightforward and may require a series of hoops to jump through. For example, some warranties may only cover repairs done at specific repair shops or may include a depreciation clause that reduces the amount paid for repairs based on the vehicle’s mileage.
Before purchasing an extended warranty, it is important to read the fine print and understand the terms and conditions carefully. Also, check the company’s reputation and reviews. This will help you avoid a bad experience with the company in the future. It is also important to consider how much you drive each year, because the warranty price can vary based on your driving habits. Many warranties also require a deductible. These deductibles can be charged on each repair or billed as an annual fee. Some of these deductibles can be avoided by keeping detailed receipts.buy extended warranty for car