It’s natural to wonder whether car extended warranty on a used car is a wise investment. Answering that depends on the coverage you’re looking to purchase. Our goal is to explain everything you need to know about extended car warranties in this article.
Extended car warranties are optional vehicle service contracts you can purchase from a third party. Typically, they cover the cost of major repairs for a set period or number of miles. The warranty usually begins at the expiration of the manufacturer’s warranty, though sometimes the two overlap.
They offer two main types of extended car warranties: manufacturer’s warranties by most carmakers and aftermarket warranties, which third-party vendors sell. Manufacturers’ warranties typically cover the following situations:
Basic warranties – A majority of new and used vehicles come with these features. The warranty covers significant parts and systems that fail due to defective components installed from the factory.
Bumper-to-bumper warranties – Provide comprehensive coverage for all of a car’s parts and systems, including routine maintenance and wear and tear damage.
Powertrain warranties – are components that connect the car’s wheels to the car’s engine, transmission, and any other power components.
“Secret” car warranties – Provide free repairs from the manufacturer. It’s also called a “silent recall” or technical service bulletin (TSB).
Typically, they provide aftermarket warranties by dealerships or third parties and are categorized as follows:
Extended warranties – Provide a similar level of protection to what you get from the manufacturer’s warranty, but they are subject to restrictions and exclusions.
Adjustment warranties – Covers certain auto repairs within the first several weeks or months of purchase.
Wrap warranties – In addition, they offer a powertrain warranty, so they can effectively cover bumper to bumper.
Corrosion warranties – provide coverage for rust damage.
Car extended warranty acts as an insurance policy for your car’s major components. If you need repairs, you can take it to a shop and pay a deductible. The policy coverage will differ depending on the warranty type you choose and your provider. The general rule is that extended warranties will not cover routine maintenance or damage caused by normal wear and tear. The benefits include significant parts of your car, such as the engine and transmission, along with extras like 24/7 roadside assistance, rental reimbursements, trip interruptions, and tire protection.
Do you need an extended warranty if your car is brand new and the manufacturer covers you? The following reasons will convince you that purchasing car extended warranty for your new car is a good idea.
In general, automobile manufacturers offer preset warranty plans at preset prices. They tailor car extended warranty from a third-party company to cover areas where the factory warranty does not. Payments for extended warranties can often be custom-tailored to fit your budget, so they’re more manageable than the costs of a costly repair.
Modern cars now feature an increasing number of high-tech features, which require more complex electronic and computer systems. Finding the problem and repairing a technology component can be very expensive when it fails. Extending your auto warranty is one way to protect your vehicle’s technological systems.
Your new car was just delivered, and you now want to maximize its use. Factory warranties typically last for three years or 36,000 miles (whichever comes first). Your new car can continue to function using extended protection as it should for years to come.
It is a requirement to service your car at a specific dealership when your manufacturer’s warranty is up, as well as extended warranties offered by car dealerships. It’s either a dealership or nothing—you can’t stay with your known and trusted mechanic. The third-party companies allow you to choose the facility that will repair your vehicle.
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