7 Best Car Warranty Companies of 2022
Before we begin, it’s important to note that the car warranties you buy independently from the purchase of your new or used car — and which we’re reviewing below — aren’t actually warranties at all.
A manufacturer’s warranty, if you have one, comes with the car at the time of purchase and provides either bumper-to-bumper protection, coverage only for the powertrain, or a combination of both dependent on time and mileage limits.
What are colloquially known as car warranties are actually service contracts that extend certain protections of these original manufacturers’ warranties.
For the purpose of this article, when we talk about “car warranties,” we’re talking about the service contracts you can buy as an aftermarket item that pay for certain repairs to your no-longer-new car, or used car warranties. When we talk about “manufacturers’ warranties,” we’re talking about the warranty that comes as part of the purchase price of a new car.
Car warranties also shouldn’t be confused with either car insurance or motorcycle insurance. Warranties cover the cost of repairs resulting from standard wear, while insurance protects against accidents, theft and any damage you cause to other vehicles or property while driving. They’re also legally required, whereas aftermarket car warranties are entirely optional. Car warranties don’t cover known issues, such as design defects. However, once a design defect is identified, usually the manufacturer will issue a recall and fix the problem.
When you shop for a car warranty, it’s important to know exactly what you’re buying, who you’re buying it from and what factors will determine your coverage.
We’ll go deeper into this topic after our company reviews, but here are a few things to keep in mind when shopping for a car warranty:
- Read all contract terms and fine print to know what’s covered
- Car warranties won’t cover any pre-existing issues in your car
- Most car warranties require a 30-day waiting period
- The lower your mileage, the more affordable your warranty
What Are the Best Car Warranty Companies of 2022?
- Best for High-Mileage Vehicles: Endurance
- Best for Customer Support: Concord Auto Protect
- Best for Warranty Plan Options: Carchex
- Best for Complete Vehicle Coverage on All Plans: ProtectMyCar.com
- Best Online Warranty Marketplace: Platinum Auto Warranty
- Best for No-Deductible Plans: Complete Car Warranty
- Best for Quote Process: Autopom!
The Best Car Warranty Providers of 2022
Best for High-Mileage Vehicles: Endurance
Endurance has one of the best car warranty plans in the industry for old- and high-mileage vehicles, offering four tiers of coverage for model years as far back as 1958 (but most up to 20 model years) and with up to 200,000 miles on the odometer.
Service | Select Premier High Mileage | Secure | Secure Plus | Superior | Supreme |
---|---|---|---|---|---|
Air Conditioning | |||||
Brakes | |||||
Cooling System | |||||
Drive Axle | |||||
Electrical Components | |||||
Engine | |||||
Suspension | |||||
Fuel | |||||
Gaskets | |||||
Steering | |||||
Transfer Case | |||||
Transmission | |||||
Turbo/Supercharger |
Coverage Benefits and Add-On Options
All of the company’s protection plans come with Endurance Elite membership, which includes 24-hour roadside assistance and tire repair/replacement. In addition, customers have access to merchant discounts, ID theft protection tools, key fob replacement, repair finance options up to $5,000 and a personal assistant for reservations, directions and emergencies.
Endurance has one of the best trip interruption policies in the business, offering $150 reimbursement per day for a maximum of three days. The average warranty usually only covers $50 per day up to $150. However, Endurance’s rental benefits are on the lower side, only reimbursing a maximum of $150.
Endurance’s contracts are a bit hit or miss. On the positive side, it doesn’t have a “betterment clause,” which is a common element in contracts that refers to parts that, if added, would improve the condition of your car while increasing its value. This means that if a repair is needed, the warranty will allow a better part to replace a cheaper one.
On the other hand, it does have a consequential loss clause, meaning the warranty won’t cover parts that are damaged by other uninsured parts. For instance, if an uninsured battery, say, leaks acid onto an insured part, the warranty will not cover the repair. This limitation can be critical for customers, as their coverage can be nullified without their knowledge.
Endurance also offers various add-on options for its plans. These include:
- Commercial Use. This option is available for commercial vehicles, including ride-hailing, like Ubers.
- High-Tech. This add-on plan covers devices like video systems, display screens, GPS and navigation systems, blind spot detectors and anti-theft systems.
- Tire Modification/Body Suspension Lift. This provides coverage for vehicles with oversized/undersized tires, body lifts or suspension lifts.
- Hybrid Vehicles. This option covers parts commonly found in hybrid and electric vehicles, including motors, power controllers, generators and inverter assemblies.
Reputation, Customer Service and Financial Strength
Endurance offers 24/7 claims processing and extensive options for choosing a mechanic. Almost every dealership and 350,000 certified mechanics in the U.S. and Canada accept its warranties.
Additionally, Endurance is one of only nine warranty companies in the U.S. to have a gold-level certification with the Vehicle Protection Association. The VPA sets standards for the car warranty industry, ensuring that members meet or exceed federal or state regulations. It is also named the top-rated car warranty company by ConsumersAdvocate.org and multiple other review websites.
The company has also been the recipient of many other awards, including gold, silver and bronze Stevie Awards for great employers, customer service department of the year, company of the year and a Golden Bridge Award for best website of the year.
Most importantly, the company is backed financially by the Wesco Insurance Co., which holds a solid A- (excellent) score from the financial rating site AM Best.
Drawbacks
Endurance’s services aren’t available in California, one of the largest car markets in the country. Also, even though Endurance is a direct provider of car warranties, not all of its plans are administered directly by the company. It doesn’t mention which plans are administered by other providers, so we had to call to find out. Plans for commercial and high-mileage vehicles, for instance, are covered by United Car Care Inc., which is fine, but it would be nice if it were more transparent about that information.
Best for Customer Support: Concord Auto Protect
Concord Auto Protect has the best customer support of the companies we reviewed, offering 24/7 support by phone, an online form, email and Facebook Chat. When problems arise, Concord allows customers to choose any repair facility in their area as long as it’s certified by the National Institute for Automotive Service Excellence.
Though its three tiers of coverage are rather average when compared to others on this list, Concord Auto Protect still covers enough to be an excellent choice.
Components | Premium | Advance | Powertrain |
---|---|---|---|
Engine | |||
Transmission | |||
Drive Axle(s) | |||
Electrical | |||
Cooling | |||
Brakes | |||
Trip Interruption | |||
Dead Battery | |||
Out Of Gas | |||
Parts & Labor | |||
Towing | |||
Locksmith | |||
Rental Car | |||
24 Hour Roadside | |||
AWD/4×4 | |||
Steering (Manual or Power) | |||
Heating | |||
Air Conditioning | |||
Fuel System | |||
Anti-Lock Brakes (ABS) | |||
Hi Tech Electronics | |||
Turbo/Supercharger | |||
Rear Suspension | |||
Front Suspension |
Concord’s additional perks are also pretty standard for the industry, although some of its limits are above those of its competitors. For example, a typical rental car reimbursement for extended car insurance stands around $50 per day for up to a maximum of three days while Concord offers $75 per day for up to four days. The company’s towing reimbursement is also high for the industry at $120.
Drawbacks
Unfortunately, Concord Auto Protect has a number of drawbacks that need to be addressed. First, it backs its own extended warranty plans, meaning there is no insurance company protecting your investment in the event Concord goes out of business.
Second, the company’s online service contract doesn’t mention optional coverage. This means no protection for commercial vehicles or onboard tech like GPS.
Finally, like other companies on this list, Concord’s contract has a consequential loss clause, limiting claim options in the event that an insured part is damaged by an uninsured one.
Best for Warranty Plan Options: Carchex
With five different plan tiers to choose from, each offering several coverage options, Carchex provides the widest range of coverage of all the companies we reviewed with 21 total plans.
Carchex’s Silver plan works like a powertrain warranty, while its Titanium plan is comparable to a bumper-to-bumper warranty. Carchex’s Gold tier can be a suitable option for cars with mileage in the 60,000-plus range. Older vehicles are typically covered up to 100,000 miles, but exceptions can be made up to 125,000.
Provider | Program Name | Longest Term Available |
---|---|---|
American Auto Shield | Diamond | 7 years |
CARCHEX Care by AAS | Titanium Plus | 7 years |
CARCHEX Care by Royal | Titanium | 7 years |
Royal Administration Services | Ultimate | 10 years |
Allegiance | Ultimate | 7 years |
CARCHEX Connect | Comprehensive | Monthly |
Provider | Program Name | Longest Term Available |
---|---|---|
American Auto Shield | Platinum | 5 years |
CARCHEX Care by Royal | Platinum | 7 years |
Royal Administration Services | Premium | 10 years |
Allegiance | Platinum | 5 years |
CARCHEX Connect | Preferred | Monthly |
Provider | Program Name | Longest Term Available |
---|---|---|
American Auto Shield | Deluxe | 5 years |
CARCHEX Care by Royal | Gold | 7 years |
Royal Administration Services | Preferred | 10 years |
Allegiance | Gold | 5 years |
CARCHEX Connect | Standard | Monthly |
Provider | Program Name | Longest Term Available |
---|---|---|
American Auto Shield | Powertrain Plus | 6 years |
CARCHEX Care by Royal | Silver | 7 years |
Royal Administration Services | Centennial | 6 years |
Allegiance | Silver | 5 years |
Allegiance | Select Elite | 5 years |
CARCHEX Connect | Powertrain Plus | Monthly |
Provider | Program Name | Longest Term Available |
---|---|---|
American Auto Shield | Bronze | 6 years |
CARCHEX Care by Royal | Bronze | 5 years |
CARCHEX Connect | Powertrain | Monthly |
It’s important to note that Carchex is a broker rather than a direct provider. This means that its warranties are guaranteed and administered by three different companies: American Auto Shield, Allegiance and Royal Administration Services Inc.
Only some plans are actually managed by Carchex.
Optional Coverage and Additional Benefits
Optional AAS coverage includes a labor rate ceiling of $100 per hour for repair facilities, as well as the ability to switch to that facility’s rate if it’s lower. Most warranties charge a flat $100 or more per hour even if the mechanic typically charges less. Royal, on the other hand, does not offer this benefit. The Titanium plan offers the widest variety of optional coverages, though these vary by provider.
Keep in mind that benefit limits under each plan can vary depending on which provider you choose.
For example, Royal has a reimbursement limit for car rentals and other expenses while your car is being repaired of $40 per workday and a per breakdown maximum of $320 (eight days), while AAS allows a per workday reimbursement of $40 and a per breakdown maximum of $160; Allegiance tops out at $30 per day with a maximum of $150 (five days).
As for roadside assistance, Royal offers a breakdown limit of $320 while AAS sets its at $400. Allegiance has a maximum of $100 per occurrence.
Reputation and Financial Backing
Carchex is the recommended partner of consumer protection companies such as Carfax and CarBuyingTips.com.
Since all of Carchex’s contracts are provided by AAS, Allegiance and Royal, all of their car warranties are financially secure. Contracts by these companies are backed by American Bankers Insurance Co. of Florida, which scores an A (excellent) rating from AM Best and an A3 (stable) from Moody’s.
Drawbacks
Since the company is a broker, not all queries are directly handled in-house. For the same reason, you’ll have to pay close attention to each contract’s limitations and exclusions. For example, Royal’s contracts have a consequential loss clause, and all of AAS’ contracts have both consequential and betterment clauses. This means a higher likelihood of you paying more in out-of-pocket costs for breakdowns than you would with another warranty provider.
Annoyingly, if you get a quote from Carchex, you’re agreeing to be contacted by the company or its partners by phone, text message and email. Although it’s common for companies to have a disclaimer stating that it can contact you once you submit a quote online, it’s usually that company that contacts you, not its partners.
Best for Complete Vehicle Coverage on All Plans: ProtectMyCar.com
Protect My Car is a direct provider of both warranty plans and maintenance plans. Plans are backed by Virginia Surety Co. The company offers nearly complete vehicle coverage on all three of its warranty plans.
Coverage Benefits and Add-On Options
Protect My Car offers three warranty programs and three maintenance plans. Each warranty plan comes with a flat deductible, after which the policy pays 100% of covered repairs.
Details on the three warranty programs are as follows:
- Driveline: This plan is designed for vehicles that are up to 10 years old and have up to 150,000 miles. The plan has a $200 deductible and will cover the repairs listed below.
- Select: This plan is designed for vehicles with age and mileage levels that are just outside those offered on the Supreme plan. The plan comes with a $100 deductible and will cover the repairs listed below.
- Supreme: This is the most comprehensive plan offered. It’s designed for newer vehicles and those with low mileage. It will provide coverage for an additional five years and up to 100,000 miles. The plan also comes with a $100 deductible and will cover the repairs listed below.
★ DRIVELINE | ★★ SELECT | ★★★ SUPREME | |
---|---|---|---|
Deductible | $200 | $100 | $100 |
% Policy Pays Toward Repairs | 100% | 100% | 100% |
Engine | |||
Transmission | |||
Transfer Case | |||
Drive Axle | |||
Differential Assembly | |||
Front & Rear Suspension | |||
Cooling System | |||
Air Conditioning & Heating | |||
Electrical | |||
Select Brake System Components | |||
Timing Chain | |||
Turbo Charger | |||
Navigation | OPTIONAL | ||
Additional Benefits | |||
Roadside Assistance | |||
Rental Car | |||
Oil Changes | |||
Tire Rotations |
Protect My Car’s maintenance plans, referred to as Ambassador Maintenance Plans, come in three different versions. Each includes free oil changes and tire rotations, guaranteed 24/7 roadside assistance, lockout services, assistance with flat tires and rental car reimbursement. It covers most vehicles regardless of the year or the number of miles.
But the plans are mainly discount programs that will provide from 25-75% off the cost of mechanical repairs. The difference between the cost of those repairs and the amount the maintenance plan will pay is referred to as the deductible. That’s the portion you’ll pay out-of-pocket for those repairs.
The three maintenance plans and their benefits are as follows:
★★ Ambassador Elite | ★★★ Ambassador Pro | ★★★★★ Ambassador Platinum | |
---|---|---|---|
Deductible | 50% | 50% | 25% |
Engine | |||
Transmission | |||
Transfer Case | |||
Drive Axle | |||
Differential Assembly | |||
Front & Rear Suspension | |||
Cooling System | |||
Air Conditioning & Heating | |||
Electrical | |||
Select Brake System Components | |||
Timing Chain | |||
Turbo Charger | |||
Navigation | |||
Additional Benefits | |||
Roadside Assistance | |||
Rental Car | |||
Oil Change | |||
Tire Rotations |
Reputation, Customer Service and Financial Strength
Protect My Car has an A+ rating from the Better Business Bureau, which is the highest issued on a scale of A+ to F. Plans are covered under Virginia Surety Co., which has an AM Best rating of A (excellent).
Drawbacks
Protect My Car does not offer or sell vehicle service contracts in Alaska, California, Hawaii, Missouri, Oklahoma or Washington state. Also, it offers discount plans, not true warranty plans.
On all three maintenance plans, wear and tear items are not covered. These include batteries, belts, catalytic converters, brake pads, rotors, spark plugs and related items. The plans are also subject to a waiting period of 30 days and 1,000 miles.
Best Online Warranty Marketplace: Platinum Auto Warranty
Platinum Auto Warranty provides bumper-to-bumper repair coverage on just about any type of vehicle. That’s because it’s an online car warranty marketplace.
By submitting information about yourself and your vehicle, you can receive competitive quotes from multiple providers. More than a half-million drivers have purchased warranty plans through the platform.
Coverage Benefits and Add-On Options
Platinum Auto Warranty provides service plans across the country. The company provides an extensive list of covered repairs, including engine replacement, timing belt, gasket leaks, powertrain control module, transmission replacement and alternator replacement.
Other covered repairs are:
- Engine
- Transmission
- Cooling System
- Drive Axle
- Brake System
- 4×4 AWD
- 24-7 Roadside
- Rental Car
- Out of Gas
- Dead Battery
- Trip Interruption
- Towing
- Steering System
- Air Conditioning
- Fuel System
- ABS Brakes
- Suspension
- Turbo / Supercharger
- Seals / Gaskets
Reputation, Customer Service and Financial Strength
Reputation, customer service and financial strength will be unique to each warranty provider participating in the Platinum Auto Warranty online marketplace.
Drawbacks
Platinum Auto Warranty’s greatest strength — providing access to multiple providers on the same platform — is also potentially the greatest weakness.
Since there are many different providers, the quality, reputation and service levels provided will vary from one company to another. That holds the potential for signing with a company that provides less than satisfactory service. You’ll need to to do further investigation of any provider offered.
You should also be aware that once you provide your information on the platform, you may be solicited by multiple companies, even after you’ve chosen a provider or decided not to proceed.
Best for No-Deductible Plans: Complete Car Warranty
Complete Car Warranty is part of Complete Car LLC, based in McKinney, Texas. It offers three separate warranty plan groups, each with its own set of plan levels, benefits and pricing. Complete Car Warranty offers some plans with no deductibles, although those tend to be the least comprehensive plans.
You should also be aware that each plan group is administered by a different entity, as follows:
- CarGuard plans: Administered by Central Administrative Service Corp. of Florida Inc., based in Tampa, Fla.
- Matrix plans: Administered by Matrix Financial Services LLC of Dallas
- Royal plans: Administered by Royal Administration Services Inc. of Hanover, Mass.
Coverage Benefits and Add-On Options
Complete Car Warranty offers three plan groups, and though the coverage options are similar between all three, specific details will vary. For example, you can expect to have a different deductible based on the plan level you select within each group.
The three plans are described below:
CarGuard offers five plan levels: Platinum, Gold, Powertrain Plus, Powertrain and Powertrain Enhanced. Of the five, Platinum is the most comprehensive, providing coverage for major components as well as for steering, air conditioning, suspension, fuel system, cooling system, and seals and gaskets. All five plans come with 24/7 roadside assistance, towing, trip cancellation and car rental.
Matrix also offers five plan levels: Enhanced, The Answer, Name Stated, Powertrain Enhanced and Powertrain Plus. Of the five, Enhanced is the most comprehensive. All five plans also cover hybrid car components. Each plan also comes with towing, 24/7roadside assistance and trip interruption.
Royal offers four plan levels: Ultimate, Premium, Preferred and Primary. Ultimate and Premium provide the most comprehensive coverage, but all plan levels include 24/7 roadside assistance, towing, trip interruption and car rental.
Reputation, Customer Service and Financial Strength
Complete Car Warranty has a rating of B with the Better Business Bureau, on a scale of A+ to F. There is no indication of an insurance company backing the warranties offered.
Drawbacks
Unlike other car warranty providers that allow you to complete the application process online, Complete Car Warranty uses the online application as a point of entry only. Once you complete it, you’ll be called by a warranty specialist who will discuss the options with you. This holds the potential for the specialist to be a salesperson.
You’ll need to evaluate if that party is legitimately concerned that you get the right plan or simply trying to sell you a higher priced plan.
Also be aware that while you will be obtaining your plan through Complete Car Warranty, each plan you select will be administered by a third party. That means Complete Car Warranty functions as an online marketplace for a very limited number of warranty providers.
Best for Quote Process: Autopom!
The car warranty industry is notorious for making customers call directly for full, detailed quotes. Autopom! is the exception.
We requested three online quotes from Autopom!, and it answered in less than a minute, providing detailed quotes that broke down plan type, total cost, deductibles and even possible payment plans. Additionally, Autopom! sent its quotes before calling us, making answering the call optional rather than necessary.
We also wondered if Autopom! would pester customers with follow-up calls if they refused to answer their phone call, but Autopom! surprised us again with only two calls after three days. Instead, the representative politely apologized for calling and gave their full information in case we wanted to contact them.
Overall, the customer experience with Autopom! was the most enjoyable of the companies on our list.
Plan Flexibility
As a broker, Autopom! partners with four car warranty providers — Integrity Admin Group, EGV Cos. (Omega plans), Royal and Mercury General — to offer four different plans. With one or two plan options offered by each provider, there’s ample flexibility for customers, including a choice of mileage cap and a maximum term of three, five, seven or eight years.
The four plan options also offer flexibility in terms of what’s covered. For example, the first plan, Powertrain Plus, offers traditional powertrain coverage but also includes the option of covering the electrical, air conditioning and fuel systems.
Mechanical Breakdown Insurance
Consumers living in California can also purchase mechanical breakdown insurance from Autopom!, which is like an extended car warranty that only covers parts or mechanical breakdowns, rather than accidents, etc. The company has MBI plans available for each tier of coverage.
Financial Stability
All of the companies partnered with Autopom! are financially stable. Omega plans are backed by Lyndon Southern Insurance Co., which has an A- (excellent) score on AM Best through its parent company, Fortegra Financial Corp.
Royal is backed by American Bankers Insurance Co. of Florida, which has an A (excellent) score from AM Best and an A3 (stable) from Moody’s. Mercury General also has an A (excellent) score from AM Best.
Drawbacks
There are two drawbacks to working with Autopom! First, since the company is a broker, coverages, exclusions and limitations will depend on the provider you choose. This isn’t necessarily a problem, but not all plans are available in every state and some are state specific, so you’ll have to contact the company directly by phone or email or request an online quote to see if the plan you’re interested in is available in your area.
Also, all of Autopom!’s contracts have consequential loss clauses and one of the companies, UCC, has both consequential and betterment clauses.
How We Determined Our Top Picks
To determine which car warranty providers were the best in the business, we looked at three criteria: plans, claims and reputation. Because warranty prices vary greatly depending on the make, age and mileage of each vehicle, we decided price wasn’t a great indicator of a company’s overall value.
In order to rank these criteria, we created three personas from Texas (the second most populous state) and requested three quotes from each company using the following parameters:
For the first two quotes, we used one of the most popular cars in the nation: a Honda Civic. We gathered information for model years 2000 and 2018 to see how big the price difference would be for a new vehicle versus an older one of the same make and model.
For the third quote, we used a 2018 Fiat 500L to see if prices would change for a less reliable make.
From this, we determined firsthand how each company evaluates new and old vehicles, which companies are courteous and which are pushy when selling their plans over the phone.
Next, we looked at sample contracts when available on company websites to see what each plan offered. Companies that offer sample contracts give customers a chance to choose the best coverage option for their situation and to understand its limitations and exclusions. This transparency also sends a trust signal to consumers, who are reassured that the company has nothing to hide and is working with their best interest in mind.
It’s important to remember that your specific coverage, limits and terms will vary depending on the year, make, mode, and mileage of your car. That means you should look at sample contracts as an example of what a company typically covers.
Obviously people buy car warranties as a hedge against repair costs, so how a company handles claims and repairs is extremely important. We came up with a step-by-step method for investigating how well companies handled this important service.
- We verified whether claims are handled in-house or externally. Companies that process claims in-house tend to have better control over the quality of their claims handling and can enhance the customer experience.
- We looked for companies that allow customers to choose a certified repair shop on their own without network restrictions.
- We chose companies that charge fair prices and allow their customers to choose a deductible that meets their budgets.
- In an industry with a history of shady dealings and rip-off contracts, we looked at each company’s reputation and customer feedback.
- We also looked for certifications that could serve as indicators of the company’s customer service standards — Vehicle Protection Association and the National Institute for Automotive Service Excellence certification, for example.
- Finally, we looked at financial backing. We checked whether the companies on our list had financial backing from larger insurers. Such backing guarantees the enforcement of a service agreement for its entire duration.
Choosing the Right Car Warranty
Car warranties can be purchased for cars that were bought new as well as used. They also can be bought at any time before or after the expiration of the manufacturer’s warranty. This means that you can opt for continuity of service by buying before the manufacturer’s warranty expires or wait as long as you like to begin coverage.
These extended warranties are not necessarily for everyone. If, for example, you plan on owning your new car for only five or six years, an extended warranty may be unnecessary as the manufacturer’s warranty will likely still be in place throughout that term. Or if you own an older car nearing the end of its life, a warranty probably isn’t worth it.
A good alternative in these cases — as well as for those who simply don’t want the added expense of a warranty — would be to save a certain amount of money each month in a savings account earmarked specifically for repairs.
For those who decide that a car warranty is right for them, there are a few options, terms and strategies you should familiarize yourself with before deciding on coverage.
You Better Shop Around
Many dealerships sell extended warranties as a voluntary extra when purchasing a new or certified used car. While this is certainly an option, you probably won’t have had the opportunity to do any comparison shopping before signing on the dotted line.
We found that, without exception, car warranty providers allow customers to bargain for a price below their original quote. Do not accept the first price quoted to you and be prepared to play a little bit of hard ball.
You should also prepare yourself for up to a month of follow-up calls from these companies. The car warranty industry, frankly, has a well-earned reputation for being rife with sharks and scammers; for expensive, useless plans; and for irritating salespeople. Few companies offer online quotes, specifically so they can give you the hard sell over the phone.
Pressure tactics like speed talking and threats of “limited time offers expiring in the next … let me look at my watch here … TWO MINUTES!” are common. These guys do not give up easily — once they have you on the phone, they’re going to push hard for a sale right then and there.
Relax. Ignore the noise. Ask questions, stand your ground, get the information you need and promise nothing. You don’t owe the salesperson anything.
It’s always a good idea to get quotes from at least three warranty companies both to compare coverage specifics from each company and play them off each other in a bidding war.
If one company is offering the same service for a lower price, tell the other companies and they will almost certainly pull the old “let me talk to my manager and see what we can do for you” schtick before offering you a price sometimes a few hundred dollars below the original quote.
Finally, be on the lookout for phone scams from people posing as representatives of your car’s manufacturer or car warranty company telling you that your warranty is about to expire. During these calls, you will be asked to provide personal information like your credit card and Social Security numbers, which is always a red flag.
Never give personal info over the phone to anyone who called you. Instead, check for yourself to see if your warranty is about to expire, and contact your provider directly.
Plans
Car warranty plans vary in their specifics according to provider and a number of other factors, including age, mileage and make of the vehicle, but all plans fall into one of three categories.
- Powertrain warranty: These provide the least protection, covering only the main components that generate power in a vehicle, such as the engine, transmission and drive axle assembly.
- Inclusionary warranty: Also known as a “named parts warranty,” this only covers parts listed in the terms of the contract. If any part not listed in the contract fails, the consumer must pay for the repair out of pocket. These plans are considered middle tier, being more inclusive in coverage but still limited in scope. These are best for owners who want to cover specific parts of their car and spend less in the process.
- Exclusionary warranty: Also known as “bumper-to-bumper,” this is more like an extension of the manufacturer’s warranty, covering so many parts that it’s easier for the contract to state what parts aren’t covered. This is the most complete coverage an extended car warranty offers.
Regardless of what plan you go with, make sure to read your contract carefully. Your coverage and customer experience are 100% determined by this document. Know what it covers and up to what limit, and know all exclusions so that there is no confusion when deciding whether to file a claim. It’s also a good idea to compare contracts from the different companies you called to see which one benefits you and your vehicle most.
It should be noted that almost every company has clauses and limitations in its service contracts depending on the state you live in. These amend certain aspects of the contract, including cancellation protocols, refund policies, claim protocols, and limitation and liability amendments. It’s important to study this section to see how these amendments apply to you.
Lastly, extended car warranties have language built into the contract that requires you to perform the manufacturer’s recommended routine maintenance. Failure to carry out these recommendations can result in denial of coverage. Be sure to keep receipts from all of your routine checkups, oil changes and any other required maintenance, since companies will ask for proof that you’re keeping up with the maintenance regimen.
Premiums and Deductibles
Though car warranties are not auto insurance by any means, the business essentially operates on an insurance model, meaning your two main areas of cost will be premiums and deductibles. And, as with insurance, the sizes of these will depend on the company you choose, as well as on the make, model, age and mileage of your car. Standard deductibles are generally around $100, and are charged either on a per-visit or per-repair basis.
High deductibles usually mean lower premiums and vice versa. It should be noted that car warranty companies reserve the right to renew or suspend your contract at the end of the contract term. Eligibility requirements for renewals are the same as for new policies, which means plans are expensive as your car ages.
Exclusions
All contracts have exclusions. It’s important to understand what’s excluded from your car warranty before purchasing your policy.
Most plans, for instance, don’t cover routine maintenance, including tune-ups, adjustments, alignments, tire replacement, oil and filter changes, and fluid refills. Parts that commonly break due to wear and tear — think brake pads, tires and clutches — are also usually excluded, though they can sometimes be added to the plan at an extra cost.
Some exclusion clauses prevent certain parts from being fixed. The two most common, as we’ve mentioned a few times are “betterment” and “consequential loss” clauses. These can severely limit your repair options, as well as nullify your claims, meaning you’ll have to cover repairs out of your own pocket.
Finally, extended car warranty plans usually don’t cover cars used for commercial means, such as taxis, commercial delivery vehicles and cars used for ride-hailing. Some plans will offer such coverage, but at an additional cost.
Bottom Line
Service contracts — excuse us, car warranties — fill the coverage gap between auto insurance and regular maintenance and may not be for everyone. Everyone wants to believe that the value of what they get back from one of these plans will exceed the total they pay. And for some lucky people, that really happens.
For those interested in protecting their automotive investment, whether new, used or certified pre-owned, the right warranty absolutely can extend the useful life of their car while saving them money over the long run. As Dirty Harry, the well-known industry expert put it, “You’ve got to ask yourself a question Do I feel lucky?”
And while you might decide that you aren’t feeling particularly lucky, remember that not all warranties are created equal, nor are the companies providing these plans. In an industry prone to scams and hard-sell tactics, it’s a good idea to comparison shop a few different plan providers, read the contracts thoroughly and make sure you’re dealing with a legitimate company.