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An extended car warranty refers to a service contract that covers a list of specified repairs once the warranty of the carmaker expires. This article discusses some important factors you need to think about before getting that extended warranty:
Who Is Backing that Warranty?
The manufacturer of the vehicle may back the extended car warranty or a third party (with no connection to the carmaker) may back it. Manufacturer-backed extended warranties are in some ways similar to extensions of the original manufacturer warranty since the car will be repaired by technicians trained by the carmaker and OEM (original equipment manufacturer) parts will be used.
Third-party backed extended warranties may or may not allow you to have your vehicle repaired at a facility affiliated to the carmaker. You should consider the implications (such as the use of OEM or aftermarket parts) of who is backing the extended car warranty before you buy it.
Are There Deductibles?
Pay attention to whether the extended car warranty policy includes a deductible or not. The best policy should have no deductible so that you limit how much you spend on the car during the period covered. In case there is a deductible, consider how much it is and what effect it has on the cost of the policy. If the difference between the cost of the policy with a deductible is negligible when compared to the cost when no deductible is included then buy the version without the deductible.
Who Foots the Bill?
Find out who is responsible for paying the repair shop for repairs before you buy an extended car warranty. For instance, some policy providers may require you to pay the repair shop then submit the receipt so that the company reimburses you for that expense. Such a requirement may involve a long wait (weeks, for example) before you receive the payment from the insurance company. Other policy providers pay the repair shop directly so you do not have to spend any money once repairs done. Choose a policy provider that pays the repair shop directly.
What Is Covered?
Ask a mechanic to advise you as to what parts are most likely to wear out or need repairs such as the transmission system and air conditioning system. Make sure that the extended car warranty covers such components before you buy the policy.
You will have no reason to regret if you buy the extended car warranty after considering the factors discussed above.Share
9 July 2015