When you buy a new car, it comes with a manufacturer’s warranty designed to cover problems such as mechanical failures. The warranty will cushion you from additional expenses if your car breaks down within the indicated timeline. However, manufacturers offer different warranties for specific areas of the vehicle that expires after a certain number of years and/or miles.
You can buy an extended warranty, sometimes referred to as car warranty insurance, to avoid spending money when your car has a problem. In this post, we will cover everything you need to know about car warranties, including the best companies offering car warranties, the difference between a warranty and insurance, and what your car warranty covers.
What Is Car Warranty Insurance?
Car warranty insurance is a different way to say extended car warranty, which is a type of service contract policy that covers auto repairs after your car’s factory warranty has expired. You can buy aftermarket auto warranty coverage from vehicle manufacturers or extended car warranty companies.
Manufacturer’s Warranty vs. Extended Car Warranty vs. Car Insurance
A manufacturer’s warranty, also referred to as a factory warranty, usually comes with the car and is included in its initial cost. It covers problems related to defective components and kicks in when a component fails to function efficiently. It’s usually limited to a number of years and miles.
An extended car warranty is a type of coverage you buy when your manufacturer warranty expires to protect you from paying out-of-pocket fees if your car needs repairs. Unlike the manufacturer’s warranty, that’s limited to specific defects; the car warranty covers most components. It allows you to buy the plans that best fit your budget and warranty needs. This warranty doesn’t cover repairs caused by weather, accidents, and other factors.
Car insurance is a comprehensive policy that covers the car, driver, passengers, and other motorists. The policy helps protect you from paying medical bills, property damage, and legal fees out of pocket in the event of an accident. All damage should be accidental.
What Does a Car Warranty Cover?
Car warranties cover repairs and replacements for breakdowns that occur from regular use. Choosing your plan wisely is essential to ensure your warranty covers expensive and vulnerable parts of your car, ranging from the engine and transmission to the air conditioning and other electrical systems. Most warranties don’t cover routine maintenance. Paying for services such as oil changes and tire rotations are your responsibilities.
How to Find the Best Extended Warranty Company
Here are a few factors to consider when searching for an extended car warranty provider to ensure you get a plan that fits your budget, car type, and lifestyle:
Industry Standing
Reputable extended warranty companies partner with manufacturers and other trusted companies and regularly win awards. Awards and recognition can help you confirm a company is legitimate.
Coverage Offered
If you have a budget, you might want to learn what your money will cover. Inquire about the parts and components covered, and determine whether they match your needs. Read the contract carefully, and review all exclusions before signing any paperwork.
Customer Service
Because your vehicle can break down any time, you need an extended car warranty provider who can respond to you promptly. You can read reviews, complaints, and ratings online. You’ll likely come across several complaints, even about the best-rated company, but too many complaints can signal poor customer service.
Cost
While you’re looking to lower your repair costs, the lowest possible plan might not be helpful if it covers only the engine. That means you might still have to spend money on frequent repairs the warranty doesn’t cover.
Transparency
Avoid companies that hide critical details such as quotes and company information. This information should be available on their website and other networks.
Better Business Bureau (BBB) Rating
This rating gives scores based on a company’s ability to resolve customer complaints, transparency, affordability of plans and products, licensing, and business practices.
Top 5 Best Extended Car Warranty Providers
Here are five of the highest-rated warranty providers:
Endurance
Endurance offers the widest selection of standard warranties and maintenance plans for old and high-mileage vehicles. It provides six coverage plans for up to eight years or 200,000 miles. Endurance warranty costs between $546 and $612 per year of coverage, with total costs between $2,990 and $3,990, depending on your plan.
Carchex
Having been in business for more than 20 years, Carchex has worked hard to get an excellent A+ rating from the Better Business Bureau. The company has also won awards for its excellent customer service and high mileage limits. Carchex has five plan options that cost around $120 to $170 per month.
Protect MY Car
Established in 2005, Protect My Car is an excellent option for short- and long-term financing, as it allows warranty holders to pay minimal monthly payments for up to 60 months. While this plan works well for low-income earners, it costs more in the long term. Protect My Car extends up to 10 years/125,000 miles.
CarShield
Another excellent option offering low rates, CarShield is known for its positive online reviews. It boasts an average 4.0 out of 5.0 stars across more than 29,000 TrustPilot reviews and 4.2 out of 5.0 from more than 10,000 Google reviews. CarShield’s plans range from as low as $89 to $129 per month.
Autopom
Autopom, which stands for “automotive peace of mind,” is a great option if you want to learn more about extended warranties. Representatives from Autopom work with their customers to navigate the application and claim filing processes. The coverage plans last up to seven years or 150,000 miles. Each plan includes 24-hour emergency roadside assistance, trip interruption reimbursement, and tire protection.
To provide reliable and accurate information, we based our rankings on the company’s performance, coverage, reputation, customer reviews, experiences, and cost. We weighed the number of years and positive reviews against the overall number of customers served to come up with our list.
Before making a final decision to purchase a car warranty, it’s essential to review your needs and determine how much coverage you want for your vehicle. Shop around, compare quotes, and read reviews to find the best car warranty provider in your area.
At FIXD, our mission is to make car ownership as simple, easy, and affordable as possible. Our research team utilizes the latest automotive data and insights to create tools and resources that help drivers get peace of mind and save money over the life of their car.
