If you are in the market for a new car, one of the first things to consider is whether it comes with a warranty. These days, warranties typically come with all new cars, but coverage can vary depending on the type of warranty and what it covers. This article will help you understand the pros and cons of a car warranty, as well as how to choose one that best fits your needs.
Pros of a car warranty
Lowers unexpected repair costs
Most car warranties cover both parts and labor costs for a certain period after you buy your new car. With certain parts such as a transmission assembly easily costing $2,000 or more, having a warranty could save you a lot of money in the long run. This means that you will not have to worry about paying out of pocket for repairs while you are still paying off your car.
Convenient claim process
When you have a manufacturer’s new car warranty, you can get repairs performed at your dealer’s service center without having to pay for them upfront. Simply schedule a service appointment online and the mechanic attached to your dealership will diagnose the problem and fix the problem free of charge.
Can be rolled over to the new owner
Most car warranties are transferable when you sell your vehicle. This adds value to your vehicle since the new owner can get added protection for the remaining warranty period. Your warranty may also be transferable if you trade in your car for a new vehicle at a similar time.
Peace of mind
Peace of mind is probably one of the best benefits of having a warranty on your vehicle. Knowing that you are protected in case something goes wrong with your car gives you the confidence to drive your car and rest assured that any contingencies will be taken care of.
Con of a Car Warranty
Limited coverage
The drawback of a warranty is that it only covers certain aspects of repair and maintenance. This means that you may still be responsible for any additional costs associated with repairs, such as shipping and sometimes labor. There are also exclusions on certain contracts such as wear and tear or damage caused by excessive use, negligence, or racing.
What about Extended Warranties?
When purchasing your car, you can also get an extended warranty. An extended warranty is a separate contract that you purchase in addition to the original manufacturer’s warranty. It can provide coverage for mechanical or electrical repairs after the manufacturer’s original warranty expires or cover additional issues such as scheduled maintenance, wear and tear, and cosmetic damage.
The cost of the extended warranty will depend on the plan you choose and how much coverage you wish to add. Most extended warranties cost a few thousand dollars, depending on the make and model of your vehicle. Due to the additional cost, they are generally best suited for luxury and expensive cars that are more difficult and costly to maintain and repair.
How to Choose a Warranty?
There are many several warranty types offered by different manufacturers and dealerships. Some key things to consider when choosing a warranty include:
Covered parts – Make sure you understand which parts of the vehicle are covered under the warranty. Some extended warranty plans can cover up to 5,000 named components per car while most basic warranty plans may only cover important systems such as the engine, transmission, and suspension.
Duration – The validity period of the warranty will help you determine whether it is long enough to fully protect your investment. Typically, a basic warranty is between three and five years while extended warranties can last up to seven years or more.
Additional services – In addition to providing protection for repairs and replacements, some warranties also offer extra services such as roadside assistance and towing. This is especially useful for people who frequently travel long distances or use their cars in extreme conditions.
Deductibles – The deductible is the fixed amount you will pay toward each repair covered by the warranty. Some new car warranties have no deductible required while others may require a deductible depending on the make and age of the vehicle and the terms of the contract.
Exclusions – Make sure that you read the contract carefully and understand the terms before making any purchase. Carefully check the list of exclusions to be fully aware of the services and items that are not covered. This will ensure that you are aware of restrictions that could affect your use of the car.
Cost – The cost of an extended warranty will depend on several factors. You will usually pay an upfront fee for the warranty contract as well as a deductible for each covered service or repair. Add up the potential fees that you may incur to see if your extended warranty will provide you with value for money.
Conclusion
Car warranties are a smart investment for anyone who owns a vehicle. They can save you from the hassle of dealing with unexpected repairs or replacement costs and can also provide important peace of mind when you are on the road. If you want more from your car warranty, consider purchasing an extended warranty for more comprehensive coverage and additional benefits.
