There’s no better thrill than buying a brand new car. The shiny cover, the rubbery car seats, the purring of a new engine- you’ll do anything to take care of your newly minted beauty. Now, this is where the concept of warranty schemes comes to save the day!
Buying an extended warranty has its advantages. It can help you negotiate more robust and attractive deals if you wish to resell your car in the future. Or, if you want to keep your vehicle beyond the period of your initial warranty, you’ll be better able to safeguard your four-wheeled friend from injuries and losses.
However, spending on an extended warranty can be considered a redundant or pricy investment. So, there are many facets to be thought of before acquiring one for your vehicle.
The world of auto warranties and claims is a tricky place to navigate. But, have no fear, as we have covered and attempted to tackle all possible doubts in this nifty article!
If you’re thinking of investing in an extended auto warranty and need some burning questions answered, then look no further and read below!
What is a Warranty?
A warranty is a contract that promises assurance to repair or replace a purchased item within a stipulated amount of time. An extended warranty or a service agreement is a long-term version of the original warranty. In some cases, one purchases the extended warranty when buying the car or else after the initial contract has expired.
Each company has its warranty scheme. The scheme encompasses fundamental aspects such as the duration, price, vehicle parts, etc.
When Should You Invest in an Extended Auto Warranty?
An extended warranty comes with its list of advantages, but a list of factors can help you decide whether to make the decision.
- If you use your vehicle religiously or are prone to accidents, then the investment is most likely beneficial.
- If you would be unable to pay for repairs or maintenance during your initial warranty period, an extended warranty can mitigate future financial crunches.
- If you wish to resell your vehicle in the long run, securing an extended warranty can significantly amplify its resale value.
- If you’re driving an older, broken-down car, investing in an extended warranty can prevent inevitable breakdowns.
11 Factors to Consider When Getting an Extended Auto Warranty
1. Carefully Consider Your Needs
If you live in an area with harsh weather conditions, then breakdowns in your car are very likely. Or if your commute to work is rocky, long, and daily, then your vehicle may suffer from breakdowns. In such cases, buying an extended warranty can be a prudent decision.
It is crucial to weigh in the seriousness of your need before deciding to invest.
2. Did you Shop for the Best Price?
While most store managers and manufacturers claim that their prices are non-negotiable, one can still haggle over the costs. This step is especially crucial if one prioritizes the backing and reliability of their extended warranty as original manufacturers are the safest dealers for negotiations.
3. What is the Duration of the Warranty?
Different warranties cover a specific amount of distance or years. Ask the manager for complete details on the nature and length of the warranty.
If buying an old car, you can ask how many years of the previously obtained extended warranty is left.
4. What are the Components Covered?
Auto warranties may not cover everything. Each warranty scheme covers different parts of your vehicle- the more expensive the package, the more all-encompassing.
It is essential to ask extensive questions about what your scheme covers – the number and extent of repairs, reimbursement options, the locations of repairs, etc.
5. Who is Backing the Warranty?
Usually, every manufacturer can provide and issue an extended warranty. However, this is a more expensive albeit safer option.
Many third-party dealers also offer the same warranties. These are usually offered at a far lower price but carry a heavier risk of fraud.
6. When is the Extended Warranty Delivered?
Every manufacturer or dealer has an individualized time to provide the extended warranty. Some issue it at the beginning, when you’re buying a car. Others may allow you to choose it once your initial contract terminates.
7. How is the Payment of Repairs Done?
Ensure the contract specifies how payment for repairs would take place. Many times, the buyer may get conned into paying for certain aspects. In case of the latter, enquire whether any reimbursement would take place. If so, take note of how and when you would transfer the money.
8. Would New or Old Parts Be Used in Repairs?
There’s no harm in enquiring about the parts to be used in your vehicular repairs. Some manufacturers may use previously older car parts while others may utilize brand new pieces. It is a policy that is contingent on the manufacturer or dealer.
If you’re paying for a higher package, don’t be afraid to request the usage of newer mechanic parts!
9. How Would Claims Be Handled?
It is advisable to peruse the company’s claim policies before striking a deal. Extendable and customer-friendly claim policies can be life-affirming in certain situations.
In case you’re stranded in the middle of the night or your car has broken down just before an important road trip, your vehicle’s claim policies can help you. One of the most reliable ways to evaluate this is by reading customer reviews online.
10. Are There Any Cancellation or Transfer Fees?
There may be circumstances where you’re unhappy with the vehicle or wish to resell it early. In such scenarios, it’s helpful to be aware of the cancellation fees in advance.
While an extended warranty can maximize the resale value of your car, you would have first to ensure whether you can transfer it to the new owner. If not, then confirming the number of transfer fees and what it’s contingent on is helpful.
11. Are there any Requirements for Maintaining the Warranty?
Lastly, many manufacturers expect the buyer to put in some maintenance work to uphold the contract. For example, you may have to regularly maintain car parts such as your tires and oil changes.
Not only will such small efforts aid the longevity and good health of your vehicle, but they will help maintain your contract for longer.
To Sum Up
An auto extended warranty is a signed contract that prolongs the warranty period of vehicles beyond what is offered by the manufacturer. It covers the cost of repairs and replacements of the car in situations of damage. Often time-bound, it promises to cover the vehicle within that specific amount of time.
An extended warranty has many facets which need to be thoroughly understood and directed to make an informed decision.
Some of the critical factors to remember while acquiring an extended warranty are the duration, the cost, and the need.
Additionally, the reliability of the manufacturer or dealer, transfer/cancellation fees, etc., should be taken into account, as well.
We hope this comprehensive list cleared your doubts and added to your confidence!
Whether or not you choose to invest in an extended warranty, we caution our readers to take the time needed to make a well-informed decision.
All the best!