By: Sarah E. Sanuth, is an insider in the automotive industry  with many years of experience in the car dealership and repair business

An auto warranty gives us a certain kind of assurance, or peace of mind that if something goes wrong with our car, it will be taken care of, even if it means that we have to pay a little extra for it. While new cars always come with a warranty, a used car almost never does unless it’s a recent model (new cars typically come with a 4 year or 50,000 mile warranty, whichever comes first); and it’s best to explore your options before you dive right in.

The market is flooded with companies that will offer aftermarket extended warranties for any used vehicle. Normally, all you have to do is provide them with the make, model and VIN number and you are returned a quote on the vehicle.

When shopping for an extended warranty for your vehicle, here are some things to consider:

  • If your vehicle is pre-1998 or the car has more than 140,000 miles, most extended warranty companies will not cover you.
  • your car usually has to be driven less than the average yearly mileage (some companies will only warranty your car if you drive less than 10,000 miles a year.)
  • It is often cheaper to get an extended warranty before an existing warranty lapses.
  • On average, an extended warranty will cover 11,000 to 15,000 miles per year
  • Coverage can be obtained for between 1 and 5 years (depending on the age and mileage of the vehicle.)
  • Coverage will cost between $1500-3500 per year and deductibles are typically between $0 and $100.
  • Certain vehicles are never covered; such vehicles include some high ticket Mercedes’, Land Rover’s, Ford Contours, and most performance cars like Porsche’s.
  • Dealers mark-up their warranties. It may be cheaper to purchase a policy independent of the dealer (If you are at a Ford dealership, you can request a “Ford” warranty. A dealer may tell you they only offer aftermarket warranties because they make more money on them.)
  • Most extended warranties are not transferable, coverage ceases the moment you sell the vehicle. A few companies will allow you to transfer it, which can be a great selling point if you decide to sell prior to coverage ending.

Before you shop for an extended warranty, you should first consult consumer reports at www.consumerreports.org for the most common repairs to the vehicle that you have (you should consult this when purchasing the vehicle as well.) There is a cost to use this service (about $26.00 for 1 year.) If you don’t want to pay for this service, you can also find similar info at Edmunds.com or simply Google your year, make and model with “common repairs”. This will tell you what it would normally cost you to repair a vehicle in a given year period and what you will need to have covered with an extended warranty.

Then compare the cost of the extended warranty and any co-pays or additional costs against what the repairs would cost without the warranty. If the repairs would normally be less or about the same without the extended warranty, it’s probably best to take that money and put it aside for those repairs.

Keep in mind that not all warranty companies are the same, and many of the conditions for covering a part or breakdown can be very different between one and the other.

ALWAYS READ THE FINE PRINT

Many extended warranty companies will boast their service will save you money and they offer the most comprehensive coverage. But just because they say it, doesn’t mean it is true.

Always research a company before you purchase a warranty. Check consumer complaint websites such as complaints.com and see what others are saying. The Better Business Bureau Online also offers a Consumer Safe Shopping List (visit bbb.com and search for the company name) .

While there are companies out there that do offer very comprehensive coverage, many don’t; so beware. Reading the area of the contract that will tell you what is, or isn’t covered is key. Some companies will tell you that transmission repair is covered. However, they cover only certain parts of the transmission (usually parts that will never wear.) Mechanics know that it is cheaper to just replace the entire transmission than it is to rebuild one, and less time consuming. Many extended warranty companies will force you to have a transmission rebuilt, which means more time and more money.

Remember, wear and tear and regular maintenance items aren’t covered, unless coverage is purchased separately. This includes everything from brakes and oil changes, to transmission flushes and tune-ups.

Warranty companies use “book times” for how long a repair should take. However, “book times” are under the most perfect conditions. In many cases, car owners are forced to pay the difference on the bill of what the warranty company won’t pay.

There are also some extended warranty companies out there that don’t make good on their contract, and rather will deny a claim on a small technicality. Others will also have it hidden in there that there isn’t just a co-pay, but rather only a certain percentage of the repair is covered.

The warranty company’s procedures are very important. If procedure isn’t followed properly, any repair resulting could not be covered, regardless of whether or not the part or component is covered. Make sure you make note of these procedures and follow them every time you have an issue.

When it comes time to purchase an extended warranty, make sure that you aren’t purchasing based on cost, but rather coverage. A cheaper policy will cover less and cost you more in the long run.

If you have a question you’d like our experts and community to answer, please ask your question at http://forum.iseecars.com.  To start your used car search, visit http://www.iSeeCars.com  

Search used cars for sale and find the best deals near you at iSeeCars.com.
To get a FREE iSeeCars VIN Report for a car, click here.