We often have customers ask if buying an extended warranty for their vehicle is worth the cost. Most used car warranties cost around $1,500 - $3,500 for an additional five years of coverage beyond the manufacturer’s warranty period, depending on the year, make and mileage of your vehicle. Think of it as paying in advance for repairs your car may need in the future. Most extended warranty companies let you make payments over 24 months. Many come with benefits like roadside assistance and rental car reimbursement that you may already have through an AAA membership or rental coverage through your auto insurance. Warranty companies offer various levels of coverage from basic to comprehensive.
Consumer Reports conducted a survey on extended car warranties in 2016 and made the following observations:
- Half of the respondents with a car model 2000 or newer didn’t file a claim over the five years extended warranty period.
- About 30% of used car purchasers (who also purchased an extended warranty) needed to use the extended warranty in the first year of ownership.
- 80% of extended warranty users had all of their claims honored.
Based on Consumer Reports research and poll, they do not recommend spending money on an extended warranty for a used car. They prefer the “save it for a rainy day” approach.
We have found consumers often struggle getting their claims paid when using extended warranty services.
- Most warranty companies require proof your car has received the manufacturer’s recommended services at the proper intervals.
- Most extended warranties only cover “non-wearable” items. The majority of vehicle repairs involve replacing wearable items, such as brakes and timing belts.
- Most extended warranties cap the labor rate they pay for repairs. This rate is often below the rate most shops with ASE certified technicians charge, leaving the customer to pay the difference out of pocket.
If you have any questions about servicing your vehicle, or would like advice on making a used car purchase, please feel free to stop by Addison Auto Repair & Body Shop to speak with one of our helpful service advisors.
