A car warranty covers the cost of car repairs completely or partially and protects owners from out-of-pocket payments. By doing so, warranties reduce the financial risk associated with periodic maintenance for car owners. Besides this, there are many things that car owners need to know and consider before selecting a car warranty provider or extending their existing warranty period. Understanding car warranty terms and other details helps one pick the warranty suited to their needs.
Types of car warranties
Comprehensive warranty
One of the top features of a good car warranty is comprehensive cost coverage. This kind of warranty is also known as bumper-to-bumper warranty as it covers nearly all of a vehicle’s systems. If a car comes with a comprehensive warranty, then its manufacturer will cover the costs of repairing its air-conditioning, anti-lock brakes, interior trims, transmission, and other components when owners take their vehicle to one of its dealerships.
Generally, comprehensive warranties last around 3 years (or 36,000 miles of usage) or 5 years (or 60,000 miles of usage).
Powertrain warranty
Unlike a comprehensive warranty, this option only covers the cost of repairing the mechanical parts that help move the car. The key benefit of this type of warranty is that its coverage period lasts several years (or several years worth of driving/miles driven), often exceeding the coverage period of a bumper-to-bumper warranty. Some of the best powertrain warranties cover the repair costs up to 10 years/100,000 miles of vehicle usage. This means that if a car comes with 36,000 miles of comprehensive warranty coverage, then owners will need to pay out of pocket if the machine’s electric windows stop working at about mile 36,001 and beyond, but the cost of repairing its gearbox will still likely be covered by a powertrain warranty.
The debate around comprehensive vs. powertrain warranty is a common one. Car owners need to opt for the alternative that suits how they use their vehicle and their other specific requirements.
Corrosion warranty
Cars that are put to extensive use for many years are likely to undergo corrosion and perforation. This is especially the case when vehicles are driven and parked in the snowbelt states. Corrosion warranty covers a car against rust and corrosion-related issues.
Certain warranty providers may have their specific terms of service provision and definitions of “significant corrosion-related damage,” while others limit coverage based on actual perforation observed on a car’s metal panels. A corrosion warranties often provide coverage for 5 years and unlimited miles of usage.
Restraint systems warranty
This kind of warranty covers the costs of repairs associated with a vehicle’s airbags and seatbelts. The period of coverage tends to vary dramatically from one manufacturer to another. For example, certain manufacturers offer the usual 5-year/60,000-mile coverage, while other companies may go the extra mile and offer lifetime repair coverage.
Extended warranty
After a manufacturer’s warranty runs out, car owners can prolong coverage by paying for an extended warranty. They can purchase it from the manufacturer of their vehicle, the dealership from where they purchased it, or third-party service providers. The new car warranty vs. extended warranty debate does not have a definite winner, as both alternatives help vehicle owners during different phases of a vehicle’s usage.
Some other common types include emissions systems warranties, tire warranties, and hybrid and electric car battery warranties for vehicles with electric motors and hybrid powertrains.
Things to know before buying car warranties
There is a deductible for extended warranties
Prolonged warranties can be rarely used by vehicle owners. Purchasing this kind of warranty requires an understanding of car warranty terms and how the coverage essentially works. Extended warranty providers often need users to pay an added cost on top of the price of the warranty itself. This cost is known as a deductible and needs to be paid monthly to the service provider. If the deductible is too high and does not lead to users getting special benefits from the package, then buyers should explore other options for extended warranties.
Extended warranties only begin once the factory warranties expire
Many people make the mistake of purchasing an extended warranty weeks or months before their original purchase warranty expires. This tends to be counter-intuitive as extended coverage only begins after the original one lapses. For this reason, it is wiser to wait for the manufacturer’s warranty to run out before car owners splurge on extended warranty packages.
There are many car warranty scams to be aware of
Many malicious elements use various ways of swindling people’s money and information. Across the country and internationally, fake extended warranty providers masquerade as authentic providers before securing payments from customers and then disappearing with their clients’ hard-earned money. So, an important tip for car warranty buyers is to do thorough online and offline research on third-party warranty providers by checking past customer reviews, going through the website of the provider and testing its authenticity, and checking their accreditation.
Popular car warranty providers
There are many well-known names when it comes to manufacturer or third-party car warranty providers. One can explore car warranty comparison guides online to make an informed decision.
- Jaguar
- Kia
- Mitsubishi
- Hyundai
- Genesis
- Select Auto Protect
- Premier Auto Protect
- Endurance
- Chaiz
- Autopom
- American Dream Auto Protect
