An extended car warranty is a great way to protect your vehicle from costly repairs due to mechanical breakdowns. It is very similar to the manufacturer's warranty, as it usually covers faults in major systems such as the powertrain. A comprehensive warranty can cover more systems, including heating and air conditioning, steering and safety technology, and more. The primary purpose of an extended warranty is to cover major mechanical repairs, such as the engine, transmission, electrical system, and more.
Extended car warranties cover the cost of repairing or replacing parts of your vehicle that break down over time. A plan is useful if you're not prepared to pay for repairs, especially those that cost hundreds or thousands of dollars. An extended warranty is usually a contract or agreement for financial coverage for auto repairs. The cost and the items covered vary from company to company and within the different levels of benefits offered by each company.
On the other hand, the extended vehicle warranty is a totally optional purchase (but highly recommended). 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. The extended car warranty (MBI or VSC) covers the cost of mechanical breakdowns due to defective parts that have nothing to do with an accident or other event covered by car insurance.
The law doesn't require you to have MBI or VSC coverage for your car, but some drivers choose to buy them because of the peace of mind they offer. Or, if you'd like to include extended warranty coverage in the financing of your new vehicle, you can compare guarantees for a win-win situation. You'll get optimal coverage and price, and your dealer will get a nominal benefit for the convenience it offers. If your car isn't the most reliable, you might be more comfortable buying an extended warranty than without it. Manufacturer warranties typically cover defects in materials and workmanship, while extended warranties can cover both defects and wear and tear.
But what happens when the manufacturer's warranty expires? If you're thinking of buying an extended warranty for extra protection, here's what you should know: The cost of extended warranties can range from hundreds to thousands of dollars a year, but you'll likely pay thousands. Every extended warranty company has something different to offer, so it's worth looking for a good price. Drivers can purchase an extended warranty from an outside company or directly from their vehicle manufacturer. Used car warranties from outside companies are one way to get coverage if your vehicle's original factory warranty has expired. These warranties don't include typical wear and tear items such as tires, brakes, and other regular maintenance items. 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.
However, if you're concerned about the reliability of the car, the cost of repairs, or simply want additional coverage, you might consider purchasing an extended warranty for additional coverage. Extended warranties are separate agreements that do not relate to the coverage included with the new vehicle. Vehicle service plans are offered by auto insurance companies while extended warranties are generally sold by dealers or third-party companies.
