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Right after you’ve bought your vehicle, you might have heard your car dealer urging you to include an extended car warranty to your purchase. So what is an extended car warranty? Is it worth buying from car dealers?
What is an extended car warranty?
An extended car warranty, also known as a vehicle service contract, is a protection coverage that will help protect drivers from spending expensive out-of-pocket car repairs or parts replacement. It may seem like a simple protection coverage that offers repair service whenever your car breaks down but an extended car warranty is more than just a paper contract.
This is why some people get their claims denied because of the lack of knowledge on how extended car warranties work. In this article, we’re going to understand what an extended car warranty is and the pros and cons of buying an extended car warranty from car dealers.
Pros of Buying an Extended Car Warranty from Dealers
1. Guaranteed Top Quality Replacements
One sure thing when it comes to car dealer warranties is that the car parts replacements are of genuine quality and receive excellent service.
2. Worry-free Payment Schemes
The great thing about extended car warranties from car dealers is that they offer worry-free payment schemes. All the necessary paperwork from repairs and replacement are handled by the car dealer, the only thing that you need to think about is paying the remaining deductible.
Cons of Buying an Extended Car Warranty from Dealers
1. More Expensive Compared to Third-Party Providers
If you’ve been offered by both the dealer and third-party providers an extended car warranty, then you should notice that dealer warranties are more expensive. This is because you’re not only paying for the actual warranty but they also add in the value of the factory brand.
2. Limited to Authorized Service Centers
With a warranty purchased from car dealers, you have no autonomy in which service center you’ll get your car serviced from. The reason for that is they only will approve any claims filed if you had it repaired from their authorized dealer. So when you opt to buy an extended car warranty from car dealers, then always read the fine print.
3. Costly Repairs and Pricey Replacements
Although the parts you get are genuine and of excellent quality, the price of the replacement and the service is more or less overpriced.
Third-Party Extended Car Warranty
We all know the convenience of a factory warranty that manufacturers provide, so what about third-party providers? What’s their edge? Third-party provides will offer a variety of higher-quality coverage features.
Things to Keep in Mind Before Buying an Extended Car Warranty
1. Always Do Your Research
Never settle on the first thing that warranty provider you get in touch with. Always do your research first, not all providers offer the same additional coverage and warranty premium. Ask at least 3 dealers so you can compare the prices vs the coverage you need.
2. Price Can Be Negotiable
Before signing that contract with your dealer, make sure that the price you agreed on is fair. When you shop around for an extended car warranty, you’ll already have an idea of how much you should be paying. You can either go for the provider with the lowest quote or go for the best warranty provider and negotiate your way into settling with the price you’re willing to pay.
3. Additional Coverage Can Be Tailored-Fit
The brand of car you have, the way you drive, and where you’re located are some of the few things that should be considered when buying an extended car warranty. The best fact when it comes to extended warranty is you get to choose which additional coverage your car needs.
Key Take-Away
Although some people would recommend buying from car dealers there’s no law stating that you can’t choose from other available options like third-party providers. Car dealers and third-party providers have their advantages when it comes to better coverages, so before you decide to seal the deal with either of them, shop around and find out which provider has the best plan. If you’re not sure what protection plan to get, have your vehicle inspected by a mechanic and get professional advice on which coverage you need.