Buying Extended Warranty On New Car
The length of the warranty varies by manufacturer, but many offer bumper-to-bumper warranties for three years or 36,000 miles, whichever comes first. Powertrain warranties may last for up to 60 months or 60,000 miles.
buying extended warranty on new car
Some warranty plans include extras, such as towing, roadside assistance or trip interruption protection. Many extended warranty plans require you to pay a deductible toward repairs, while some will pay every dollar of the repair bill.
Extended car warranty programs have different ways of covering repairs. Some require you to get pre-approved before any repairs are done and will reimburse you for the cost. Others work directly with the shop and pay them directly. Be sure to read the fine print in your contract before you approve any work you expect the warranty company to cover.
An inclusionary extended car warranty covers parts specifically listed in the contract, and not any parts that are not specified. Exclusionary vehicle service contracts cover everything except items listed explicitly as non-covered parts.
Typically, extended car warranty programs offered by automakers require you to visit one of their franchised new car dealerships to get covered service. Third-party providers may have you go to dealerships, networks of approved shops or any ASE-certified repair facility.
Buying a new or used car involves lots of decisions. What color do you want? How will you finance your purchase? Should you buy an extended warranty? An extended warranty can give you peace of mind after buying a new or used car, but these agreements have their limits and aren't always worth the cost. Learn how extended warranties work, when you may want one and other ways to cover the cost of car repairs.
New vehicles are covered by the manufacturer's warranty (or factory warranty) for a certain number of years or miles. Factory warranties are free and usually include both bumper-to-bumper and powertrain warranties.
Powertrain warranties cover the parts that put the vehicle in motion, including the engine, transmission, driveshaft, axles and differential. The average powertrain warranty lasts five years or 60,000 miles, whichever comes first.
You can buy extended warranties from auto dealers, vehicle manufacturers and independent companies. Dealers often suggest purchasing an extended warranty when you buy a car, but you can buy one at any time.
The cost of extended warranties varies depending on coverage, warranty length, the vehicle's predicted reliability and other factors. Warranty companies aren't regulated the way insurance companies are, so there are no restrictions on what they can charge. A recent survey reports the median price of an extended warranty was $2,458, but prices ranged from $1,615 to $3,208.
It's generally best not to buy an extended warranty at the time you buy a car, since you won't use it for several years. Wait until the manufacturer's warranty is nearing expiration or the deadline to purchase coverage is approaching.