Tips and Considerations: Extended Vehicle Warranty

General Tips and Considerations

Whether you buy a warranty online or at a regular brick and mortar company, read and save the warranty documentation. If a salesman tells you a feature of the warranty that isn't in the contract, get the salesman to put it in writing. If you buy a warranty online, save the contract and print out the web pages from that dealer's site.

Research the company that sells the warranty. This can be as simple as checking their status at the Better Business Bureau. Information for online companies can be found at www.bbbonline.org/consumer and information on traditional companies can be found at www.search.bbb.org/search.html. Many online companies will display the Better Business Bureau's seal on the site as a link to the Bureau's web site.

Many regular brick and mortar companies print receipts on thermal paper. The printed text on these receipts will fade over time. Because of this it is a good idea to make and keep a photocopy of these receipts for your records.

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Dealership Plans vs. Online Plans

Always compare plans. Many dealerships offer extended vehicle warranty plans that are comparable to online offers. Most of these dealership service contracts are partnerships with other warranty companies. The dealership just tacks on an extra fee for signing a client up. If you are considering a dealership plan, compare it to direct plans available online for a potential cost savings.

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Bumper to Bumper

Few extended vehicle warranty plans cover absolutely everything on a vehicle. Read the warranty contract and find out exactly what is and what is not covered. If the contract says it covers everything except for X, Y, and Z; that's a lot more coverage than a contract which lists 10 or 20 items which are covered. Keep in mind your own history with vehicles and what repair/maintenance needs you expect to have in the next few years.

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Wear and Tear

Many extended vehicle warranty plans cover parts which break as well as those which wear out. Once again, read the contract to understand the differences and how it may impact your final cost.

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Roadside Assistance

Similar to an AAA policy, some extended vehicle warranty plans offer a roadside assistance program. Benefits may or may not include: emergency road service, towing, mechanical first aid, flat tire service , battery assistance, gasoline delivery, fluid delivery and emergency lock-out service. Before you sign up for such a program, make sure they have a 24-hour toll free assistance number. Try calling the number to insure you can get a real person in a reasonable amount of time.

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Car Rental

Does the plan provide a rental car if the repair will keep your vehicle in the shop overnight? Many auto warranties do but some will not.

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Food and Lodging

Should your vehicle become disabled far from home and the repair is covered under your extended vehicle warranty, you may receive reimbursement for lodging and meals. Such plans usually stipulate you must be at least 100 miles from your residence for this to apply. For people who use their vehicle frequently for business trips, this can be an important feature.

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Choice of Deductibles and Coverage

Most companies that offer extended vehicle warranty contracts offer a variety of service plans with deductibles ranging from $0 to $100. Read through all the plans and decide which one is right for you. Frequently you can save a lot of money by giving up some of the extras like car rentals and by going with a higher deductible.

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Renewals

Make sure you can renew your extended vehicle warranty contract. Some plans may be renewed for continuous one-year terms for as long as you own your vehicle.

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Transferable

Many extended warranty plans allow you to transfer your coverage to a new owner when you sell your vehicle. This can increase a vehicle's resell value.

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Call the service number

Before you purchase the extended vehicle warranty, call that company's repair number. Make sure you can get a hold of a person in a reasonable amount of time. Ask the company representative about how claims are normally handled. If they tell you something different than what is printed in the contract, be suspicious.

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Research

If you haven't purchased the vehicle yet, check to see how much warranties run on various makes and models. If you are trying to decide between two cars, there may be a difference in the price of the extended vehicle warranty plans. A less expensive plan usually means the vehicle model has a better repair history.

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