An extended car warranty is a coverage plan you can purchase that will cover repairs or replacements that your manufacturer’s warranty doesn’t or after your original manufacturer’s warranty expires.
An extended warranty will cover most of the same things as your original manufacturer’s warranty, but there may be some differences.
Many people choose to purchase an extended warranty to protect themselves from expensive repairs down the road.
It would help if you kept in mind a few things when considering an extended warranty for your car.
In this blog post we’ll try to go over a few of those things and maybe help sort out whether an extended warranty is right for you.
What Warranties Are Good For
- To have someone to pay for repairs when there is a defect with your car
- To have roadside assistance in case you have car trouble while on the road
- To have regularly scheduled maintenance visits, so you don’t have to budget for them yourself
- To know that your car is being regularly serviced by a professional
- The primary purpose of an extended warranty is explicitly to cover the cost of repairs to your vehicle after the manufacturer’s warranty has expired
Understanding Your Warranty
First, read the fine print and understand precisely what is and is not covered.
Know the details that are in your contract.
Some coverage plans include car rental for when your car is getting repaired.
Others can cover parts you would think were out-of-pocket costs.
Covering navigation systems or plastic buttons that wear out and become unreadable after only two years.
Knowing where and when a warranty can save you money to get the most out of it is important.
Find a Good Deal on A Warranty
Second, compare prices from different providers to ensure you are getting the best deal.
If you’re purchasing an extended warranty during the purchase of a new car, warranties generally cost 10-15% of the car’s original purchase price.
So, if you are buying a $20,000 car, you can expect to pay $2,000-$3,000 for an extended warranty.
In the same circumstance, third-party warranties generally cost less.
As the car ages and components become worn, the cost of adding an extended warranty increases.
It is generally cheaper per day, month, and year to start earlier and stay covered like life insurance.
Consider the Deductible
Third, make sure you know the deductible amount and are comfortable with it.
The deductible is the out-of-pocket expense you will have to pay for the warranty.
It is a fee paid usually to the policy provider at the time of repair.
More often than not, warranty providers will not authorize payment to the mechanic until the deductible has cleared.
Extended Warranties are Good for Saving Money
An extended warranty can save you money on car repairs.
For example, if a $1,500 repair is needed and your deductible is $250, you would only have to pay $250 out of pocket if you have an extended warranty.
If you don’t have a warranty, you would have to pay the entire $1,500.
In this example, the extended warranty saved you $1,250.
If you had to pay for two $1,500 repairs during the course of your warranty, the savings would be even greater.
Of course, there are repair costs that a basic extended warranty won’t cover.
These include things like oil changes, tune-ups, and general maintenance.
Additionally, some warranties have a maximum payout limit.
So, if you have a $5,000 extended warranty and you need a $6,000 repair, you would be responsible for paying the additional $1,000 out of pocket.
The Benefits of Maintenance Plans
The greatest advantage of a maintenance plan is that it covers all necessary repairs and upkeep.
A maintenance plan is a sort of warranty on steroids.
With a maintenance plan, you don’t have to worry about budgeting for oil changes, tire rotations, air filter replacement, wiper wear, brake pads, or any standard services.
According to recent research by the AAA, the average annual maintenance cost for a used car is $732.
The maintenance costs for a new vehicle are even higher, at $1169 per year.
As long as your yearly maintenance plan cost is under those rates, you can be sure that even if your car goes through only its most basic wear and tear, you’ll still save money compared to paying for repairs out of pocket.
You can be confident that qualified technicians will do all the necessary services on your vehicle and that you won’t get stuck with any costly repairs.
Although regular maintenance is generally not a large cost, it can quickly add up, especially if you have more than one vehicle.
Some packages also include 24/7 roadside assistance, which can assist you if you have an issue on the road.
Towing, roadside tire changes, fuelling, and minor repairs would all fall under the roadside-assistance category.
Purchasing a maintenance plan is a great way to save money in the long run and can give you peace of mind knowing that your car is being regularly serviced by a professional.
Purchasing a Warranty
There are many situations in which an extended warranty can be useful.
For example, if you plan to keep your car for a long time, an extended warranty can provide peace of mind in knowing that you are covered if something goes wrong.
Or, if you tend to drive a lot, an extended warranty can help cover the cost of unexpected repairs.
Protect My Car is a leading provider of extended auto warranties.
We offer a variety of coverage plans to suit your needs and budget.
Our team of experts is here to help you find the perfect plan for your car.
Get in touch with us today to learn more about our warranty plans and how we can help you save money on car repairs.
If you’re considering an extended warranty for your car, here’s a recap of the few things you should keep in mind.
- Make sure to read the fine print and understand exactly what is and is not covered.
- Compare prices from different providers to make sure you are getting the best deal.
- Compare coverage because not all warranties are created equal and some provide much more support than others.
- And remember, don’t feel pressured by a car dealer, you can always purchase an extended warranty later if you change your mind.
An extended warranty can be a great way to protect yourself from expensive repairs down the road.
Do your research to make sure you are getting the best coverage for your needs and budget.
Get in touch with Protect My Car today to learn more about our extended warranty plans.
And feel free to comment below if you can think of any other good uses for an extended warranty!