There’s nothing scarier than making an investment that doesn’t pay off. This spooky season, don’t get stabbed in the back because you don’t have all the information. So today, we’ll investigate if having an extended warranty is worth the investment? Before we begin, we acknowledge that extended warranty companies aren’t all the same. While most are fine, there are some companies that may set off red flags. However, it’s completely up to you, and with this information, you can make the best decision based on your needs.
There are typically three main types of extended warranty packages: basic (or bronze), plus (or silver), and deluxe (or gold. The basic extended warranty package will be an extremely basic warranty. It will only have coverage up to a certain amount of money per hour paid out, as well as it generally will only cover half of the bill up to a maximum amount. Usually, it covers internally lubricated parts of the engine and transmission. The plus extended warranty package will include everything in the basic package with the addition of some filler options–there’s a good chance that the extra items listed in this level won’t fail during the warranty period. The deluxe extended warranty package is our recommendation for the best package to choose if you do decide to invest in one. This package will include all of the above, as well as some wearable items, such as suspension components that we know will eventually fail, hopefully in that warranty period.
But there’s a reason that thinking through the purchase of an extended warranty is important, so what is the biggest issue with these above warranties? When you purchase an aftermarket or extended warranty, the warranty company has a 90% chance that you will never have an issue with the items covered under your warranty. That basically means, they have a 90% chance of winning, and you have a 10% chance of winning. Sure, you may get some peace of mind in the event that you are able to use it, but are those odds that you want to take?
Basically, warranty companies have a much higher chance of benefiting from your purchase of an extended warranty than you are. It’s not as likely that your warranty will cover something you actually need replaced in the time you have it. In the event that you are covered under warranty and the extended warranty company accepts fault, in many cases they will battle with the repair facility and tell them what quality of part they want to install on the car and then ask us to back it with our warranty and put it in writing for them. Depending on how far you are in your warranty will really determine what they decide on parts, but we often see requests to install used parts. Naturally, a customer expects that they will be receiving a new replacement, just like they would with home insurance– if the roof goes bad, it’ll be replaced with a new roof… not a used one!
When we encounter an extended warranty, we work with the companies and represent you, our client, to ensure that they do not try to use a part that will compromise the vehicle in any way or be less quality than it came with from the factory. When we do this, many extended warranty companies will use this against us, claiming that we’re overcharging or taking advantage of the situation, when we’re really just using a quality part. This way, we can ensure the safety of our customers when they’re back on the road, try our best to see that our customers will not be in for the same issue when the used replacement brakes, and so that we can stand behind our Honest Wrenches warranty to our own clients.
Our favorite solution is to instead take the money you might spend on an aftermarket or extended warranty and set it aside. This way, when you come across a necessary repair to your vehicle, you don’t have to check a warranty sheet for coverage or take the gamble that the company will ensure a quality repair. This way, we can flip the odds that some warranty companies hold over us. Instead, 90% of the time, we have money left over, and only 10% of the time it might not turn out in our favor.
As always, we are here for you, for advice, questions, and to advocate for you as our customers. If you need assistance in your decision on a warranty, give us a call. We are here to help!