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How To Buy Extended Warranty For Used Car

A quality warranty from a reputable company can be worthwhile, but you'll want to do some research first to see whether you're getting a good deal or wasting money. After all, warranty extensions are highly profitable for the companies that offer them.

how to buy extended warranty for used car

Unfortunately, there are a lot of warranty scams out there, and even those warranties offered by new and used car dealers can have a lot of strings attached. A quick web search of the name of the warranty you're looking to buy can be a good start, but even then, you'll likely want to read through the fine print.

One of the most common catches is a warranty that will only cover or reimburse for services performed at a particular chain or network of repair shops. Unless you are comfortable with having a particular shop work on your vehicle for the entirety of the warranty, this is likely a deal-breaker.

You'll also want to look at just how broad the coverage is. An extended warranty generally will not provide the same level of coverage as the original warranty provided by the car manufacturer when the vehicle was new. Instead, the extended warranty may only look at powertrain components (engine, transmission, and axles), leaving you out of luck if, say, one of the power window switches fails or the infotainment display goes blank.

There is no firm line in the sand when it comes to extended warranty coverage for a used car. Even a vehicle with a good reliability record, a clean pre-purchase inspection, and a stack of records showing meticulous care from its previous owner can have a costly item fail.

Looking at reliability ratings when you purchase a used car can give you a glimpse into whether the car will need major repairs over the course of an extended warranty. Of course, warranty providers know this, and they price their products accordingly. A warranty for a complicated, less-reliable model is most likely going to cost more than similar coverage for a simple car with a stellar reputation.

You'll also want to look closely at the amount of factory-backed coverage still remaining on a used car you currently own or plan to buy. Powertrain warranties, in particular, can often run longer than the standard "bumper-to-bumper" coverage that replaces electrical and trim components. To find out how much coverage is left, call a dealership service department or the customer service hotline for the manufacturer and provide them with the 17-digit vehicle identification number (VIN).

By their very nature, extended warranties are something of a gamble. You can't predict just how much your car is going to cost you in repairs down the road, of course, but you can get an idea of how frequently you may expect to encounter major repairs.

You can, however, prepare to repair the items that commonly fail in your vehicle. From there, you can contact shops for an estimate of how much those items might cost to replace. If a sensor failure commonly occurs around 50,000 miles and it costs $500 to replace, then you know the warranty will at least cover that item.

Most used car extended warranties will require you to shell out a deductible with every claim. A higher deductible will make for a less costly warranty, but it can also invalidate the peace of mind provided by the coverage, especially if you use it often.

Some extended car warranties are transferable for free or for a small fee. Depending on how comprehensive the coverage is, this can be an added value when you decide to sell your car. Although typically, warranties are only transferable when you sell a vehicle to another private party.

Similarly, some warranties will refund you at least a small amount of money if you cancel the warranty before its expiration date. If you plan to sell or trade your car before the warranty expires, you may be able to get a refund.

Finally, if there's a particular component that you know is a vehicle's Achilles' heel when it comes to reliability, there's always a chance that the automaker is aware of this and has extended its own warranty to cover repairs down the road. Asking a dealership or a customer service hotline about extended coverage for any specific components may save you a bundle.

Companies that offer more than three extended warranty plans, a variety of term lengths, and useful added benefits score high in this category. When you have more plans to choose from, you can customize coverage to better suit your needs. Added benefits we look for include roadside assistance, rental car coverage, and trip interruption coverage. This rating is based on types of extended warranty plans available, coverage terms, and added benefits like roadside assistance.

Our research team reviews quotes for a variety of plans and vehicles. We consider the length and mileage of the plan, what it covers, the monthly cost, deductible options, total cost, and average cost per year of coverage. Companies with lower prices per year of coverage receive the best scores. For our 2023 cost ratings, we received over 140 prices on individual plans from a range of warranty providers.

We comb through customer reviews and perform our own shopper analysis to get a sense of the responsiveness and helpfulness of each warranty company. Our team notes patterns in positive and negative reviews to see what a company is known for. Does a company make it hard to get a claim covered or does it walk customers through the entire process?

The best warranty plan depends on your situation. A bumper-to-bumper contract covers the most parts, so it may be the best option if you want to make sure everything is covered. But if you have an older vehicle, you may want to save money and get a powertrain plan instead.

A four-year bumper-to-bumper warranty can cost anywhere from $1,500 to $4,500 depending on the provider. Some warranty providers require you to pay the entire cost up front, while others allow you to make monthly payments of about $100 to $200 per month. In addition to your monthly payment, some companies require down payments of up to $300, depending on the warranty plan.

In our industry cost analysis, we found the total average cost of an extended warranty to be $2,345. We also found the average monthly payment is $93. Looked at another way, drivers pay about $638 per year of warranty coverage on average. However, these prices can vary greatly depending on your vehicle and the plan you select.

Our research team recently polled 1,000 consumers who have purchased or considered purchasing extended car warranties. We also found in our survey that cost is the most important factor to consumers contemplating buying extended warranties. The length of the warranty and covered components ranked similarly for importance among potential customers.

CARCHEX received an A+ rating from the Better Business Bureau (BBB) and has been in business since 1999. CARCHEX partners with experts such as and Kelley Blue Book. With coverage for vehicles with up to 250,000 miles, CARCHEX is one of the best choices among used car warranty companies.

Endurance stands out for its comprehensive coverage options. You can choose between five standard warranty plans or a sixth plan that covers regular maintenance items as well. Endurance is also a direct warranty provider, which means it handles the claims process itself. (Other providers on our list are brokers and use third-party claims administrators.)

Endurance offers used car extended warranty plans in 49 states, excluding California. An Endurance extended car warranty covers 200,000+ miles, and you have access to six plans with varying levels of coverage:

Every Endurance auto warranty comes with 24/7 roadside assistance, rental car reimbursement, trip interruption coverage, and towing. Plans also come with one free year of Endurance Elite Benefits. This includes perks such as:

Reputable extended car warranty company that offers six levels of coverage and has excellent customer reviews. It is our choice for Best Coverage and our top overall pick for extended warranty providers.

Founded in 2011, ForeverCar is another newer used car warranty company. ForeverCar offers short and medium-length contracts with no mileage restrictions. By offering shorter contracts, it can keep prices low.

If you want a shorter used car warranty, ForeverCar is a great option to check out. Instead of paying over $3,000 for a long plan, you can find three-year plans from ForeverCar for under $2,000 total. Monthly payments are about $50 according to the quotes we received, which makes ForeverCar a good option for budget-conscious drivers.

Olive is a digital used car warranty company that allows customers to buy and manage their warranties entirely online. The company was founded in 2020 and the owners have been in the car warranty business since 2000. Repair Ventures, LLC, which owns the Olive trademark, has an A+ rating from the BBB.

Protect My Car offers three extended warranty options that can cover your vehicle for up to 125,000 miles. It offers a range of mid-tier coverage plans rather than the most basic powertrain plans or comprehensive bumper-to-bumper warranties. These plans cover specific repairs after your deductible.

Omega Auto Care has been in business since 1968 and has offered vehicle service contracts for nearly two decades. The company has an A+ rating from the BBB and a 4.4-star rating from customers on the site, which is high for the extended warranty industry. Omega Auto Care also has a 4.0-star rating from over 1,000 reviews on Trustpilot.

Omega Auto Care is another affordable extended warranty company. According to quotes we received, a year of coverage costs about $583 per year on average. However, with 24-month payment terms, monthly payments are about $120. Omega Auto Care also only provided one deductible option of $100 to our secret shoppers.

Whether you should get an extended warranty on a used car depends on your needs and your budget. Some drivers may prefer to pay for car repairs as they arise, while others may not be able to afford unexpected expenses out of pocket. 041b061a72


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