Car Profiles

Common Pitfalls On Warranty Plans

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It seems hard to believe that businesses can remain open but wrangle honest customers out of money needlessly. Yet that’s the case at car dealerships across the nation every day. Technically, the salesmen aren’t breaking any laws. But could they give you a better deal on warranty plans? Probably. The way the system is designed (to give added commissions for extended warranty plans sold) may lead some salespeople to pressure you into choosing a warranty immediately at the time of purchase. People who choose not to make hasty decisions often turn to the internet to secure a better deal by cutting out the middle man and purchasing an automobile warranty directly from the source.

One common problem people run into is to fail to read and understand the agreement before they get work done. Knowing the right questions to ask your warranty company is crucial, experts say. For instance, ask if you can get the work done at any shop, or do you have to look for a certain certification, or in some cases return to the dealer? Additionally, is your car covered for “wear and tear” damage or just mechanical failure?

You should have a comprehensive list of all the parts that are/aren’t covered! Sometimes you’ll get a “bumper to bumper” warranty that covers everything except for the wear items, like brakes and tires, while other times you’ll get a “power train” warranty, which covers the engine and transmission. While it’s rare to find a company that offers coverage for everything, you should ensure that some of the most expensive repairs will be taken care of.

Additionally, beware of flyers and spam emails from companies offering warranty plans that seem almost “too good to be true.” If the prices are far lower than everywhere else, it’s probably not a good idea. If you can’t find information about the company from the Better Business Bureau, avoid them. One thing you should be aware of is that there are some “companies” out there that look to cash-in quickly, only to go bankrupt in a few years, leaving you with a useless automobile warranty that no one will honor. Even some legitimate companies just don’t have back-up financing, so if claims come pouring in, they run out of money and go belly-up. To protect yourself, look up as much information as you can before signing with a company and look for a longstanding track record.

Warranty plans can be intimidating at first, especially because there are so many companies to choose from. You may want to try AutoWarrantyReviews.org or another comparison site. Look at how long the warranty company has been in business and how many claims they’ve addressed, their BBB rating, if they have clients like car dealerships and banks, if they fully explain their plans with details, if they offer written terms and conditions, if they cover all 50 states (in case you’re traveling and have a problem) and if there is some sort of money back guarantee.

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US $8.99
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