Simple Protection For Your Car and Your Wallet
Car repairs can be catastrophic to your wallet. Especially when something happens and you don't have the funds to fix your vehicle. The average household has less than $1,000 saved and quite frequently auto repair bills can be significantly more. For many of us, saving thousands in emergency funds for this type of situation is just not feasible. For that reason, an auto warranty can be a great tool to protect your finances from taking such a big hit. The right plan can save you up to 60% on auto repairs keeping your hard-earned finances safe for use on other necessities.
Do You Need an Extended Warranty
When used correctly, an extended auto warranty contract can act as a powerful safety net that can save you thousands in car repair costs. However, there are situations where an extended auto warranty simply may not be needed. It's important to be aware of these situations so that you do not spend money on what's not necessary. In the below circumstances an Extended Warranty may not be necessary:
- You bought a new car and don’t plan to drive it for more than 3 years. Manufacturer’s 3 years implied warranty covers most mechanical problems, so you may not need extra coverage.
- You plan to lease a new car for 3 years and then get a new car lease or return your lease to the dealership. Some auto dealerships will try to sell you an extended warranty on a 3-year lease. All new cars are covered by a manufacturer’s 3 years warranty, additional coverage is normally not necessary.
- Your car is over 10 years old. There is an unwritten rule in the auto industry – full coverage for old vehicles usually ends either on the vehicle’s 10th anniversary or at 120,000 miles on the vehicle’s odometer. A company that tries to sell you a warranty protection beyond that limit is clearly overpromising and could be a scamming company to avoid.
Know How to Choose the Right Service Provider & Coverage
There are a lot of options in the extended auto warranty market. As a first step, get a FREE quote from a top auto warranty provider. Knowing what extended warranty coverage you really need is crucial and can serve to save you money. Make sure that you understand the auto warranty’s main coverage plans and aren't paying for unnecessary benefits. Compare the best deals with your specific needs to narrow down your options.
You must be very careful when selecting your service provider. Make sure you do thorough research reading reviews and check to see if the company has a good rating on the BBB (Better Business Bureau).
Ask for Cancellation and Contract Transfer Policy
Make sure that you can cancel your policy if you have changed your mind. Note, that some businesses will charge you stiff penalties for any premature cancellation of your policy. Contrary to that, good extended warranty companies provide 30-days or 60-days initial cancellation policy with a full refund and normal any-time-cancellation with a pro-rated refund. They also provide contract transfer provision in case you sell your vehicle to another person or business.
Review the Warranty Contract Before You Buy
Some warranty providers will try to make you buy their services based on their business brochure. Never forget – a brochure is not a legal document, a contract is. Always review the contract very carefully. Pay special attention to the fine prints – are there any exclusions or special provisions which were not discussed with you? Review carefully the list of parts which are NOT covered by your contract. Make sure that you understand how expiration mileage is calculated in your policy – some warranties (bumper-to-bumper, for example) expire when the odometer reaches the limit stated in your contract, others (like stated auto parts and powertrain) – on total mileage incurred after the warranty contract was signed by you.