Driving a car is a privilege that every car owner can enjoy anywhere in the world. According to the U.S. Bureau of Vehicle Statistics, there are 279.1 million registered vehicles in 2018 and an additional 5.4 million registered vehicles in 2019. This surge in registered vehicles greatly affects the car industry, prompting car manufacturers and third-party companies to offer different types of extended warranties. While there are many benefits from having an extended car warranty, should all car owners get one for their vehicle?
Today, there is no specific rule that requires car owners to get their cars with extended car warranties. It’s simply a vehicle contract that many car companies/dealerships recommend to their customers. However, car owners can opt-out of the vehicle contract and choose other car contracts like auto insurance.
What is an extended car warranty?
A car manufacturer warranty is a vehicle contract between the car buyer and the manufacturer that covers defects or manufacturing errors from any car components listed in the warranty list.
A basic manufacturer warranty can be used up to 3 years and/or 30,000 mileage. Car owners are solely responsible for any vehicle repairs once their manufacturer warranty expires, which is why extended car warranties are very helpful for car owners who keep their vehicles for longer periods of time.
Here are the major factors that car owners should consider before getting extended car warranties
- Extended Car Warranties should fit the specific needs of your car
Extended warranties are designed to cover repairs for any component of a car that is included in the warranty list. There are different types of extended car warranties that could address any specific need of a vehicle. One such example is a long term powertrain car warranty that can cover any repairs that could happen in the driveshaft, transmission, or the engine of a car.
- Extended Warranties can save money from costly repairs.
Nowadays, modern vehicles are more popular than the vintage cars. Equipped with high-tech gadgets, delicate electrical wirings, and computerized equipment, modern cars are much harder to maintain and are prone to costly car repairs. It’s recommended to include all expensive electrical components in the warranty list when purchasing an extended car warranty. However, the more components included in the list, the higher the premium for the warranty. So, it’s advisable to consult your trusted mechanic before purchasing one.
- Dealers cover any paperwork and payments
One of the benefits of having an extended car warranty from car dealers is that they cover paperwork and payments for any car repairs that are under the warranty. Also, once a car owner purchases an extended car warranty offered through the dealership, they are able to get their vehicles repaired at any dealership that sells the same brand. This is a very convenient option as many extended car warranties only allow specific repair shops for its customers.
- Extended Warranties are expensive.
Although there are benefits that you can get when you have an extended car warranty, no one can deny that premiums for extended warranties are expensive. Car manufacturers or authorized third-party companies are also taking a great profit from extended car warranties. As long as the policyholder avoids any major car repairs then it will be beneficial for the providers. However, if a car had multiple major car repairs, then it will be beneficial for the policyholders. Keep in mind that premiums for extended car warranties can be negotiated depending on the terms and covered components in the warranty list.
- Extended Warranties have exclusions.
Just because you purchase an extended car warranty, it doesn’t mean that all of your car’s components are covered. There are exclusions and car owners should review the warranty list thoroughly to prevent any costs from car repairs that policyholders should shoulder.
- Limited options to authorized repair centers.
Extended car warranties that were purchased from third-party companies usually have limited access to authorized repair centers. It’s different from a warranty that was purchased from car manufacturers that offer numerous repair centers.
The thing is, getting an extended car warranty depends on how you will use your car. If you have a job that needs long drives, then an extended car warranty is a good investment for your valued car. But whatever your decision will be, always consult your trusted mechanic before purchasing an extended car warranty to get the best deal for your car.