How to Buy an Extended Automobile Warranty

An extended warranty protects you against unexpected auto repairs.

An automobile, no matter what make or model you choose to buy or how much extra cash you have, is a large investment. Not only does an automobile cost a decent amount of money upfront, but there are also considerable maintenance expenses, including payments, insurance, taxes, oil changes, inspections and of course, repairs. Generally speaking, automobile are unpredictable. Any vehicle can require repairs at any time. To help protect yourself from unexpected, costly repairs, buy an extended automobile warranty, which is basically a service contract for repairs on your vehicle.

Instructions

1. Let the auto dealership you're purchasing your vehicle from that you would also like to purchase an extended automobile warranty. This is purchased separately from your vehicle and can therefore be purchased long after you actually buy your vehicle from the dealership.

2. Read over the factory warranty for your vehicle to help you make decisions about your extended warranty. Factory warranties don't always cover all types of repairs, for example. Your factory warranty might also be expired.

3. Find out what type of company is behind the extended warranty. While you can purchase the warranty through your dealer, the actual warranty is issued by an independent warranty company or your vehicle manufacturer. Research the pros and cons of each of these options. For example, manufacturer warranties are often easier to use but more expensive than warranties offered by independent companies.

4. Get the details about the deductible before buying the extended warranty. Find out how much it is, as well if it's by the individual repair or per visit to an auto repair shop. Be aware that by the repair deductibles can add up quickly if your vehicle needs several repairs in the same visit. Zero-deductible extended warranties are available, but they are more expensive.

5. Ask where you'll be able to take your car to get repairs before buying the extended warranty. Some warranties include many repair shops in your area, while others are restricted to the dealership. This is information you need to know before buying.

6. Request a list of all the repairs that are covered by the extended warranty you're buying. Some warranties cover parts that break, while others cover wear-and-tear damage. If you plan to drive your vehicle a lot, getting wear-and-tear coverage will be important. Make sure expensive parts, such as your transmission or engine, are covered by the extended warranty.

References

• Edmunds: Understanding Extended Warranties