The Basics of Extended Warranties

- by

contract

Read the contract carefully before signing it

An unexpected car repair can lead to a devastating financial situation due to high repair bills. To prevent this from occurring, you can buy an extended auto warranty policy. Here is how these policies work.

An extended auto warranty can bridge the gap in coverage when your original manufacturer’s warranty expires. For example, all manufacturers have certain milestones they will cover the vehicle under until you reach it. After that, if a major component fails or if your car breaks down, you will be responsible for the bill. This is where an extended auto warranty can come in handy, as it takes the place of that original warranty to provide you with the financial protection you need in case a breakdown occurs.

While costs of these policies vary by provider, here are some of the factors that affect price:

  • Vehicle’s condition: Some providers have eligibility requirements your vehicle must meet before they will insure it. This may include the vehicle’s model year and how many miles it has on it. In many cases, an older vehicle with many miles may lead to a higher premium.
  • Vehicle type: Depending on the vehicle you drive you may have to pay more for your policy. This is the case if you drive a luxury brand or some foreign brands.
  • Type of coverage: Many providers will offer certain levels of protection. The more comprehensive your plan is the more parts it covers. As a result, you will pay more for that policy.
  • Deductible: A deductible is the amount of money you have to pay before the provider pays the claim. Typically, if you have a low deductible you will pay a higher cost for the premium.

Along with factors that affect price, there are other factors you’ll want to keep in mind before buying a policy. These factors should help you find the best car warranty company.

  • The first is the length of the policy. You’ll want to know how long your coverage last in terms of years and miles.
  • Next, you should find out if your policy has a deductible you need to pay before they pay the claim.
  • Third, you’ll want to find out if you can take your vehicle to any repair shop or if you have to take it to specific ones. It’s very important that you know this because if you take your vehicle to a shop that the insurer doesn’t cover then you will be responsible for the whole bill.
  • Find a reliable mechanic. Not all cetrified repair shops have reliable mechanics. It is hard to find one these days, but if you follow the tips in our recent article How to Find a Reliable Mechanic you will be safe.
  • Lastly, be sure you find out how they pay claims. This can help you understand the process more that way there isn’t any surprises when you go to use it. It’s also a good idea to stay away from providers that require you to pay the whole bill in advance and then reimburse you later.

When you are ready to shop for a policy, we make it simple. Once you will out our online quote form, you will receive quotes from reputable providers. This benefits you in several ways:

  • For one, you don’t have to research policy providers. We work with only the best providers in the business so you can have peace of mind in knowing the companies you receive quotes from are reputable.
  • Two, you can complete this process in minutes from the comfort of your couch.

Overall, extended auto warranties are great investments because they can protect you when the unexpected occurs. If you are ready to see how much a policy can cost you, feel free to begin this simple process by filling out our quote form.

Additional Information: Top 5 Extended Vehicle Warranty Tips

 

< Back to Consumer Resources