What You Need to Know About Car Warranty

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If you are nearing the end of your car's given factory warranty, you may be looking for ways to protect your vehicle from the imminent threat of costly repairs. If this is the case, you have many options on what direction to go in. But, of course, your options will depend on your needs and budget

If your car breaks outside of the warranty, you are responsible for paying the repair cost. When this happens, the situation can be very distressing. Since the average person relies heavily on their car, any issues with a vehicle should be addressed immediately. However, because there are so many things to consider, deciding between an extended car warranty and a service contract for your vehicle is important. This article will discuss both options.

 

Overview:

- What Is Auto Warranty?

- Types of Car Warranties

- What Is A Vehicle Service Contract?

- What Are The Differences Between Auto Warranty & Vehicle Service Contracts?

 

What Is Auto Warranty?

An auto warranty is provided directly by the vehicle manufacturer. Warranty can be used to refer to many different things. Although an extended car warranty can vary in terms of length, they are generally three to five years long.

These extended car warranties also allow for a limited amount of mileage. This is usually 60k to 100k miles. Although it is common for dealerships to offer extended warranties that cover "bumper-to-bumper" coverage, there is still a possibility that they may be selling less coverage that covers only powertrain components.

Vehicles that are not covered by the factory warranty do not have auto warranties. If you have an extended warranty, make sure you review all paperwork to determine the validity of your coverage, how long it covers, and any exclusions. It's also important to know that after-market modifications may void a car's warranty.


Types of Car Warranties

These are the most common situations covered by manufacturer's warranties:

 

Basic Warranty

Most certified new cars come with basic warranties. These warranties cover major components and systems that fail due to defects or flaws in factory-installed components.

 

Bumper-To-Bumper Warranties

This comprehensive umbrella coverage covers all parts and systems of a car, except routine maintenance and damage due to wear and tear.

 

Powertrain Warranties

This warranty covers the car's engine and transmission, as well as power components that are connected to the wheels of the vehicle.

 

"Secret" Car Warranties

A car manufacturer offers free repairs under its secret car warranties. These are also known as "silent recalls" or technical service bulletins. To find out if your vehicle has a technical service bulletin (TSB), search the National Highway Traffic Safety Administration database.


In contrast, these warranties are usually provided by third-party companies or dealerships:


Extended Warranties

Extended warranties provide protection similar to that offered by a manufacturer's warranty; however, there are some exclusions and rules regarding coverage.

 

Adjustment Warranties

Certain car repairs are covered by an adjustment warranty within the first few months or weeks of purchase.

 

Wrap Warranties

Wrap warranties are an addition to a powertrain warranty. They effectively offer bumper-to-bumper coverage.

 

Corrosion Warranties

Corrosion warranties help cover rust damage to vehicles.

 

What Is A Vehicle Service Contract?

A vehicle service contract is similar to an extended vehicle warranty. Often, many people confuse the two. However, there are important differences to know.

Vehicle service contracts are purchased through a dealer or outside the company and are not provided by the manufacturer. Vehicle service contracts typically offer coverage for three to seven years from the date of purchase. It's important to note that an extended car warranty does not offer the same coverage as a vehicle service contract.

Usually, vehicle service contracts provide more coverage than extended car warranties. You can also choose from various mileage plans, some of which cover up to 200,000 miles. Of course, like extended warranties, vehicle service contracts can also vary in coverage. This all depends on your car and the company you decide to sign a contract with.

If you have a vehicle service contract, check it to find out how long it covers, what coverage you bought, and if there are any exclusions.

 

What Are The Differences Between Auto Warranty & Vehicle Service Contracts?

The difference between a normal car warranty and a vehicle service contract is minimal for most consumers.

As your vehicle ages, a vehicle service contract will offer less coverage. In contrast, with an extended warranty, many dealerships won't offer warranties at all on vehicles outside the given factory warranty. Furthermore, prices for both plans depend on the vehicle, the type of coverage, and how long the coverage is being provided.

Another thing to be aware of is the usability of these plans. Although dealerships can accept both plans, an extended warranty usually can only be used at the same dealership as the manufacturer. As for a vehicle service contract, it can be used at any dealer or ASE-certified repair facility.

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