Buying a new car is not only an investment: It is a commitment. Owning a vehicle means that you are ready to spend time, money, and effort caring for your vehicle. Some car buyers consider purchasing an extended car warranty to help lighten the load when the need for sudden replacements and repairs occurs. Here are the important details you should know before purchasing an car warranty.
Extended Car Warranty for a New or Old Car
If you purchase a new car, its factory warranty is included in the price and will last for a few years after activating it on the day of the purchase. This warranty covers most of the car’s repairs until it expires. The warranty has a list of inclusions and exclusions to be clear about the coverage.
In contrast, if you bought a used car from a dealer, it may not have a manufacturer’s warranty. To be clear about this, you can read the guide on the car’s window which will inform you if the used car includes a warranty. If it does, then you may need to pay extra to get the warranty transferred to your name. You can pay an extended car warranty if the car does not include the factory warranty anymore. This is also a step you can take if you want to have more coverage after the factory warranty expires.
The Need for an Extended Car Warranty
There is no legal obligation for vehicle owners to purchase an extended car warranty, as it does not work like a driver’s license. You can drive even without an extended car warranty; all you need is a minimum level of automotive insurance as required in your area. An car warranty is a way to save you money if your car needs repairs after its factory warranty expires.
An extended warranty is valuable if you have a used vehicle that has a list of past service needs. It is also applicable to older cars that will need more services in the future. If your car’s make and model is prone to issues, an extended car warranty can help you with the repairs. Having an car warranty can help you if your vehicle breaks down on the road and can provide roadside assistance to shorten the crisis.
Factors Affecting Extended Car Warranty Costs
Many first-time car buyers find it difficult to find out how much an extended car warranty plan can cover. Unfortunately, there is no fixed standard when it comes to pricing in extended car warranties. The provider’s focus is on the vehicle and the vehicle owner. Providers have a set price range for every extended car warranty plan. They also have algorithms that help finalize the final coverage cost. Here are some of the factors that providers consider:
1. Car Owner’s Driving History
Sometimes, a car owner’s driving history impacts how much the extended car warranty coverage will cost. The provider looks at how well you care for the vehicle. This may seem petty, but it is a strong factor in determining your likelihood of having a car accident. It is the same thing with car insurance companies.
2. Type of Car
If the car is common like a sedan, the extended car warranty is not high at all. More expensive cars, such as luxury brand vehicles, cost more. Extended warranties are also costlier for commercial vehicles which may even have a different kind of warranty plan.
3. Scope
The extended car warranty coverage depends on the parts and repairs that the plan covers. If you choose a basic plan, then the coverage is not that wide. You should expect a limited list of inclusions. If you want a comprehensive plan, you will get a longer list of inclusions and the associated cost is, of course, higher. Special inclusions will make the plan even more expensive.
4. Warranty’s Duration
Longer car warranties cost more than a short-term plan. Even so, the benefits of this long-term coverage will be evident when a sudden need for parts or repairs occurs. The provider can tailor the coverage length by changing the plan’s expiration date. You need to disclose your budget to your provider as well.
5. Car’s Age
Mileage and years of function determine the age of a car. These factors affect the car’s eligibility and the cost of the extended car warranty. A more expensive warranty plan covers older cars. The price of the coverage depends on the maker of the vehicle. The maker’s reputation also impacts the coverage of the repairs that will keep the vehicle functioning.
Getting an extended car warranty is a prudent move to care for your car and can save you a lot of money on repairs and parts. If you are ready to commit to your vehicle, this plan can help you do it. Talking to the dealer or a third-party provider can get you ready for the long haul.