The primary purpose of an extended warranty is to provide coverage for major mechanical repairs. This can include the engine, transmission, electrical system, and more. The more premium extended warranties will also cover the car entertainment system, such as the radio and GPS, as well as the climate control system. What exactly an extended warranty covers depends on the type of warranty you choose.
In general, extended warranties cover critical mechanical parts of the vehicle, including the engine, transmission, axles, and gaskets. A vehicle service contract is essentially the same as an extended warranty. Not only do these warranties offset repair costs, but they often cover the costs of parts, labor, and taxes. Cheap extended warranties usually cover a list of transmission components. The most expensive plans usually cover everything EXCEPT a select list of exclusions, most of which are not related to streaming.
You can purchase an extended warranty from your car manufacturer or from an outside company, and the price is generally the same between the two. It's easy to confuse car warranties and car insurance since they both provide protection for your vehicle; however, they are two distinct services. A vehicle service contract, commonly known as an extended warranty for car owners, is an optional protection plan that you can purchase to help cover repair costs. With every new car brought to a dealer or directly from the car manufacturer, a manufacturer's warranty (also known as a “factory warranty”) comes standard. On the other hand, the extended vehicle warranty is a totally optional (but highly recommended) purchase.
Extended warranties cover general wear and tear issues; however, the specific components that are covered will ultimately depend on the protection plan you choose and your supplier. You can buy an extended warranty from your car manufacturer or from an outside company. The dealer is not wrong to do this; however, it's telling that sellers don't start out trying to sell an extended warranty since buyers would quickly leave the showroom. For more information on this topic, see WalletHub's guides on insurance against mechanical breakdowns and extended car warranties. CarShield sells service plans for vehicles which are similar to extended warranties and cover the cost of repairs to automotive systems and mechanical parts. Then ask for the name of the provider of the extended warranties they offer with their inventory along with the price levels of coverage.
Powertrain warranties cover everything that moves the vehicle including the engine, transmission, and any power component that reaches the car's wheels. It's also worth noting that mechanical breakdown insurance from an auto insurance company is often a cheaper alternative to a third-party vehicle service plan or an extended warranty. It's probably a smart decision to wait until your manufacturer's warranty is about to expire before assessing your situation and determining if you want to pay for an extended warranty. That's why while insurance covers damage caused by accidents, extreme weather conditions or even if your car is stolen; extended warranties specifically help cover the costs of covered repairs caused by normal wear and tear in addition to applicable deductibles. If you drive a reliable car and maintain enough savings to pay for an auto repair emergency then an extended car warranty probably isn't worth what you would have to pay.
