5 Tips You should Remember while Buying a New Car Extended Warranty

The average cost of a new car goes beyond $25,000. After spending so much, owners obviously expect a smooth, hassle-free functioning and longer life for their vehicle. However, many people are seen choosing extended warranty; why? Simply put, they want their investment protected.

Actually an extended warranty is not very different than extended service plans, and is similar in several ways to automobile insurance. You pay money in advance so as to avoid paying a huge amount for an unexpected repair. Here are 5 tips you should remember while choosing an extended warranty for your vehicle.

choosing an extended warranty

1. Consider Your Needs

Most auto manufacturers offer a bumper-to-bumper protection of 3 years/36,000 miles on their new vehicles. Additionally, many of them offer an extended warranty on engine and components. Limited warranty may also be available for certified used cars.

Most of the times, these programs provide excellent protection to buyers. But, if the driving crosses 12,000 miles per year or if you want to keep your car for long, then an additional extended warranty may be a good choice for you.

While buying an extended warranty, you should consider some factors like the repair history of their model. Some models have higher repair incidents than average and in that case, it becomes necessary to buy an extended warranty.

You should also consider the prices of parts. Several home models have overall repair costs half that of foreign models. Therefore, extended warranty should appeal owners of imported cars.

2. From Where to Buy?

Extended warranties can be purchased at three main organizations: manufacturer, dealer of used and new cars, and third party providers, i.e. independent companies. Each of them has his own pros and cons.

Manufacturer:Advantage of buying extended warranty from the manufacturer is you don’t have to haggle for price, components and repair, while its downside is high upfront payment

Dealer: While buying from a dealer, you can cut down on manufacturer’s warranty and service your car at them, but they usually have only one service point and if they are unable to fix your problem, you don’t have any alternative left

Third-party:Buying from a third-party provider saves you around 30 to 50 percent than that of manufacturer’s plans. Their drawback is repair shop coverage may not be consistent.

5 Tips You should Remember while Buying a New Car Extended Warranty

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3. Understand What to Look for

Apart from choosing your provider of extended warranty, there are many other factors to look for. You may get dizzy with the extensive array of features. But if you go prepared, you can easily separate really useful features from the clunkers.

What makes a good plan?

  • Freedom to select independent repair shop or dealer
  • Corporate credit card to pay
  • Transferable warranty
  • Trip-interruption coverage

What makes a bad plan?

  • Many things are excluded
  • with no strong track record
  • Non-transferable warranty
  • You have to pay from your pocket initially
  • Company Pressurization to buy plans

4. Choose a Correct Plan

The priciest upfront option is bumper-to-bumper warranty; but if you desire it for the extensive coverage it offers, you should buy it.

Choosing higher per-repair deductibles can reduce the initial price of the plan; but, if your vehicle is prone to problems, it can be pricey in the long run.

Also you must check whether the plan is transferable and renewable.

So, you should check all the plans and select a really beneficial likethe Swann extended warranty.

5. You Get What You Pay for

This is the ultimate truth of extended warranty. If you go for the cheapest plans available, you are most likely to not getting the coverage you want. However, higher price is always not better too. Best thing is to read the documents, including fine print, carefully to check what you will be getting and what you won’t.