In today’s rarefied car market, warranties are indicative of how badly manufacturers want to sell cars. Fortunately, their misfortune can be your good fortune. The only thing you have to do is know the terms of the warranty and not be misled by the magic of the word “warranty.” Don’t think that just because the warranty on a new car is “included” that you aren’t paying for it one way or another. You are paying for it, just as a part of the overall purchase price and not as a separate feature like you might with an after-market warranty.
In most cases, you’ll find that new cars come with pretty good warranties included in the purchase price. On the other hand, if you buy a used car that’s beyond its manufacturer’s warranty, it’s still worth it to look into an after-market warranty. Here’s why:
Cars aren’t objects of art. You aren’t going to buy one and park it – you intend to drive it. The value of the warranty is directly related to the car’s ability to keep moving. Figure in the incalculable cost of keeping you and your family safe, and the question becomes not how good the warranty is, but how good of a warranty can you afford? Don’t be too afraid of cost here – a good automotive warranty can pay for itself with just one major covered repair.
What you need to know from this point on is the reputation of the company that’s underwriting the warranty, the specific terms of the warranty, and the service record that the company has when it comes to fulfilling their obligations under the warranty. Any company that seems to be unwilling or unable to produce this information for you isn’t a company you want to do business with – vote with your feet and go elsewhere. There are currently large class action lawsuits under way against some disreputable auto warranty companies – no reputable company is going to have an issue with answering your questions and proving that your trust in them will not be misplaced.
The specific terms of the warranty include how the terms or words in the warranty are defined, as well as the term or time period for which the warranty will be in effect. Pay special attention to both. “Drive train” and “power train,” for example, aren’t standardized terms, so you’ll need to know how they’re defined according to the terms of the particular warranty you’re considering. Terms can also vary for different pieces of equipment. Drive train protection, for example, may exist for a longer period of time than transmission protection, depending on the specific warranty you choose.
And when it comes to know the service reputation of a company, check with the Better Business Bureau and on online car owner’s forums. Know that people who have had a negative experience are more likely to share it than people who have had a positive experience, so take reviews with a grain of salt. But if you see the same complaints coming up again and again, or if the company seems to have more than its share of complaints, consider that a warning you’d be wise to follow.
