Understanding Your Car Warranty

Understanding Your Car Warranty

An extended auto warranty can best be described as health insurance for your car.

Understanding your car warranty is key because when your car “gets sick”, the warranty service agreement then covers you by paying your mechanic or dealership directly for the cost of the repairs.

Where to get an extended warranty

Depending on the age of your car and how many miles it has on it, you can get an extended warranty from a number of places.

A few options are:

  • online form the manufacturer of your vehicle
  • from a new or used car dealership
  • from a third party broker

Believe it or not, most times it’s NOT the best idea to buy your extended auto warranty from the dealership that is selling you the car, even if it’s a new car!

How a good extended warranty works

You pay a set amount for your warranty service agreement. Your vehicle is then covered for a certain number of years OR miles on the odometer, whichever comes first.

Remember, that is years OR miles, whichever comes first, NOT BOTH. You always want to make sure you get an extended warranty that fits your driving habits, so you don’t run out of your years before your miles, or vice versa.

For instance, if you drive 12,000 miles a year and you want a warranty that covers you for 3 years, you’ll want to get one that gives you at least 36,000 miles during the 3 year period.

If you already have a car warranty and you’re wondering when it runs out, you can use this Free Factory Warranty Chart.

An extended warranty pays for mechanical repairs only (things such as engine, transmission, electrical, air conditioning problems). 

It does not cover things like routine maintenance (oil changes, tire rotations, tune-ups). It also does not pay for repairs that are needed as a result of a car accident. In that instance, you’ll want to be familiar What Happens To My Extended Warranty If I Have A Car Accident?

Some extended warranties will require that you pay for your own repairs upfront and then submit your receipts for reimbursement, after repairs are approved.

We strongly advise against these types of service agreements since it is too easy to have your warranty claim denied after you have already paid in full for your repairs.

ALWAYS choose a car warranty that makes sure that your mechanic or service facility is paid upfront with a credit card before repairs are done.

How to use your extended warranty

When your vehicle needs repairs, you simply take your warranty service agreement to your mechanic or service manager, they diagnose the problem, submit the claim, then they fix your vehicle once the repairs are approved and paid for by your extended warranty’s claims administrator.

Depending on the plan you have, you may have to pay a deductible. Some mechanics will ask for the deductible upfront, others will let you pay it when you pick up the vehicle, after the repairs have been completed.

Make sure you choose the correct extended car warranty deductible for your needs, since choosing the wrong one can cost you.

Added benefits

  • Roadside AssistanceIf your battery dies, you run out of gas, get a flat tire, or if you lock your keys in your vehicle or lose them.
  • Rental Car Coverage- Reimbursement for a rental vehicle for when your car, truck, or SUV is in the shop having warranty work done.
  • Trip Interruption BenefitsReimbursement for food and hotel/motel expenses when you break down at least 100 miles away from home.

That’s it for the basics! Check out the rest of the blog for answers to all your extended auto warranty questions.

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