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Extended Warranty Guide: How to Shop for an Auto Protection Plan

Have you ever wondered if you should buy an extended warranty? Adding a protection plan to your vehicle may help you save money on costly repairs down the road. This guide will help you determine if buying an extended warranty for your car is the right choice for you.

Discover the benefits of an extended warranty and what questions you should ask before buying a vehicle protection plan. At CARCHEX, we offer Extended Vehicle Protection Plans to cover a variety of vehicle repairs.

What Is an Extended Warranty?

Extended warranties are offered as extensions of the coverage provided by a standard warranty, such as a manufacturer warranty or a home warranty. Known sometimes as a service agreement, service contract, protection plan, or service plan, extended warranties increase the length of protection for expensive purchases. You can buy extended warranties for most major appliances like refrigerators or washing machines, as well as new and pre-owned vehicles.

What Is Covered Under an Extended Auto Warranty?

Once your car’s factory warranty expires, the manufacturer no longer promises to cover the cost of unexpected breakdowns. An extended auto warranty can replace that protection. These vehicle service contracts are useful for used cars or cars with higher mileage that need extra protection, as well as new cars that you’d like to cover for longer than four or five years (the typical length of a manufacturer’s new car warranty).

You’ll often find different levels of warranty coverage. The two most common are:

  • Powertrain coverage—Covers components of your engine, transmission, and drive axle.
  • Bumper-to-bumper coverage—Covers most vehicle components, including steering, suspension, A/C and heating, electronics, and more. You may also see the term “exclusionary,” meaning the contract only lists items that are not covered.

Extended auto warranties are offered as a way to pay for expensive repairs on vehicles, but they don’t cover everything.

Most extended auto warranties exclude the following from their coverage:

  • Wear and tear items (tires, wiper blades, brake pads, etc.)
  • Regular maintenance (oil changes, wheel alignment, etc.)
  • Damage from accidents or collision (covered by insurance companies)
  • Weather-related damage
  • Damage caused by neglect or reckless driving
  • Damage from modifications or alterations
  • Damage from lack of maintenance or improper care

Where Can I Purchase an Auto Extended Warranty?

You can purchase an extended warranty through a dealership or third-party warranty company that specializes in extended vehicle protection.

  • Dealership extended warranties are purchased directly from an auto dealership or manufacturer. Some dealer warranties may have fine print that limits you from using mechanics other than those at their facilities. They may also require you to use only original equipment manufacturer (OEM) parts.
  • Third-party warranty companies often offer a wide variety of extended warranty options to meet different needs and budgets. Providers like CARCHEX offer vehicle protection plans and service agreements for a variety of vehicle makes and models.

Benefits of an Extended Auto Warranty

Purchasing an extended warranty for your vehicle offers additional benefits and protections that don’t always come with standard warranties. Some of these benefits include:

  • Comprehensive, flexible coverage—Vehicle owners who add an extended warranty can select what parts they want to cover. You can choose more comprehensive coverage or select a basic powertrain warranty, if that’s what you’d prefer. At CARCHEX, many of our contracts are highly customizable.
  • Protection for your budget—Even common repairs may require expensive parts or have high labor costs. An extended warranty can save your wallet from surprise repair costs. You’ll only need to pay your deductible, if you have one.
  • Improved vehicle maintenance—Have you ever avoided taking your car to the repair shop to prevent a hefty bill? Ignoring the issue can cause the problems to grow worse, resulting in an even more expensive repair. It’s better for you and your car to address repairs quickly. An extended warranty frees you from the fear of visiting a mechanic, even after your factory warranty ends.
  • Additional benefits—Companies like CARCHEX include additional perks for car owners who buy an extended warranty, including roadside assistance, rental cars, trip interruptions benefits, and more.
  • Continued peace of mind—If you found comfort knowing that repairs were covered in your factory warranty, why end your coverage? An extended warranty can continue to provide that same peace of mind for years to come.
A car mechanic working on the underside of a car

Common Auto Repair Costs

Cars are complex machines that are always vulnerable to breakdowns, no matter how advanced or reliable they may be. You can potentially save hundreds or even thousands of dollars in repairs with an extended warranty. This is especially true for cars with more high-tech features that are expensive to repair or replace.

We broke down the cost of common repairs on 10 of the 50 most researched cars in 2019, according to Edmunds. The chart below details some of the estimated repair costs for common vehicle issues of popular cars, trucks, and SUVs.

Car Make and Model Repair Type Average Cost Without Extended Warranty
Honda CR-V Head Gasket Replacement $1,859
Toyota RAV4 Brake Line Replacement $297
Toyota Camry Transmission Replacement $6,204
Ford F-150 Transmission Case Shift Motor Replacement $284
Honda Civic AC Compressor Replacement $1,210
Mazda CX-5 Daytime Running LED light failure $1,100
Subaru Outback Windshield Replacement $540
Jeep Wrangler Oil Housing Replacement $730
Honda Accord Starter Replacement $620
Subaru Forester Suspension Coil Replacement $1,60

Average costs are from RepairPal and CarComplaints.com

Common repairs such as those listed above generally happen outside of a manufacturer’s warranty. If your car warranty has expired, these repair costs may have to come out of pocket. Depending on the coverage you choose, an extended warranty may cover the cost of these repairs.

CARCHEX offers five tiers of Extended Vehicle Protection Plans that offer different advantages. You can select from a comprehensive plan, cover your powertrain and a few other select systems, or protect only the items with the most expensive repairs.

Additional Perks of Auto Protection Plans

Most manufacturer warranties cover common repairs for a short amount of time or limited mileage—usually three to five years or up to 60,000 miles. On the other hand, an extended warranty from a third-party company like CARCHEX can last up to 10 years. CARCHEX contracts also include additional benefits such as:

  • Roadside assistance
  • Towing
  • Gas delivery
  • Trip interruption services
  • And more

If your vehicle breaks down along the road, CARCHEX will not only help you pay for car repairs, but also transport your vehicle to the repair shop. Additionally, CARCHEX offers a rental car reimbursement to keep you on the move if your car is in the shop for an extended period of time.

These extra perks can quickly add up to cost savings if you find yourself facing car repairs. Rentals cars and vehicle tows are expensive. You can potentially save hundreds of dollars in expenses before your car is even in the shop. To give you an idea of how much, renting a car for a week can cost $228 to $335, depending the size of car and rental company, according to The Balance.

Questions to Ask When Buying an Extended Warranty

If you are thinking of buying an extended warranty for your car, take the time to consider the following important questions.

What Is the Cost of an Extended Warranty?

Knowing the potential extended car warranty cost is likely one of the most important factors when deciding to buy a vehicle protection plan. Be sure to factor in the make and model of your car, and what the potential repair costs might be. A luxury or imported car may be more expensive to repair due to more expensive or limited access to parts. You should also take the condition of your vehicle into account, as poorly maintained vehicles may not qualify for some coverage.

Your extended warranty could cost between a few hundred dollars to well over $1,000, depending on the level of coverage you choose and your provider. You should also be aware of the contract’s deductibles, as contracts could require a deductible of more than $100 for each repair.

When shopping for the best price, be sure to look for warranty companies that offer different levels of coverage. Companies like CARCHEX that specialize in protection plans for vehicles are likely to provide you with several different price and coverage options.

Other companies will require you to spend hours negotiating to get the best price. Reputable companies like CARCHEX won’t make you do this, and will offer you the best price up front as part of our No-Haggle, Low-Price Everyday Guarantee™. If necessary, you can choose an affordable, monthly payment plan to finance your warranty.

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Is an Extended Warranty Worth It for New Cars?

If you just bought a new car, it is probably covered by a manufacturer’s warranty. You may think that this is plenty of coverage to keep your shiny new vehicle on the road and out of the repair shop for years to come. However, many manufacturer warranties don’t cover the costs associated with a vehicle breakdown or may expire too soon.

Once your manufacturer warranty expires, purchasing an extended warranty on a new car will provide the protection you need.

When Should I Purchase an Extended Warranty?

Purchase an extended warranty sooner rather than later, while your car is still new. This may make your warranty cheaper. Your car’s age and mileage are factors that determine the cost of your extended warranty. Adding a warranty to a new car will cost less than an older vehicle. For drivers who plan to keep their cars for a long time, this can generate a lot of cost savings.

Is an Extended Warranty Worth It for a Used Car?

Many used cars can benefit from an extended warranty. Often, when you purchase a used car, the manufacturer’s warranty has already expired. Unless the owner sold you a warranty, this means that the car is not covered by any warranty, and you’re responsible for repair costs. An extended warranty gives you the option to choose how much coverage is appropriate for your used car.

The best way to determine if you should add an extended warranty to a used vehicle is to consider the reliability of the vehicle. You can start by checking online for lists of the best used cars to get an idea of reliability, and look into your specific make and model’s common repairs. U.S. News & World Report, Consumer Reports, Kelley Blue Book, and CarMax can all be helpful resources.

If you have a used vehicle that is known for needing certain repairs at certain mileages, an extended warranty can be a safe bet.

CARCHEX covers used and CPO vehicles, or vehicles with more than 100,000 miles. So, you won’t be turned away from protection for your used vehicle. After all, older cars with higher mileage are more likely to face a breakdown, so having a warranty with perks like roadside assistance is a major benefit.

Male arm in suit offer insurance form clipped to pad and silver pen to sign closeup. Strike a bargain, driver money loss prevention, secure road trip, harmless drive idea, owner protective concept

How Long Is a Vehicle Covered?

Once you know what is covered under an extended warranty, the next question is to find out how long the warranty lasts. Your options will likely be a certain number of years and/or mileage. Most providers have several options, so you can customize your extended warranty to meet your needs.

A high level of coverage is generally going to be active for more miles and a longer length of time than a lower level. Shorter warranties are most useful if you plan to trade in your vehicle in the next couple of years. This allows you to enjoy the benefits of the warranty without the fear that it will go to waste when you purchase a new vehicle.

Can My Warranty Be Transferred?

In most cases, you can transfer your extended warranty to a new owner. Selling a used car with a vehicle protection plan can increase its value, according to NEA Member Benefits . For a small transfer fee, usually around $40–$50, you can move the warranty over to the new owner. The new owner then enjoys the same benefits of the warranty that you did.

Offering to transfer the extended warranty gives potential buyers a sense of protection if they choose to purchase the vehicle. It can also show that you took care of the car and valued its maintenance. The buyer will be more comfortable knowing that there are no concerning repairs needed for the vehicle, and if they come up, they won’t have to foot the bill.

Why Choose a Third-Party Warranty Provider?

Third-party companies like CARCHEX offer numerous benefits in their extended warranty plans. Unlike many dealership extended warranties, third-party providers allow you the freedom to choose your own repair shop. When you buy a dealership warranty, they are likely to require that repairs be made at the dealer or a specific repair shop.

In addition to the flexibility of using your trusted local mechanic for car repairs, CARCHEX provides a No-Haggle, Low-Price Everyday Guarantee™. Many other warranty companies quote you an inflated price and hope you do not try to negotiate. CARCHEX gives you their best price the first time, saving you time and frustrations when buying an extended warranty.

Lastly, one of the best things about third-party providers is the number of contract choices available. For example, CARCHEX has over 15 customizable vehicle service contracts. Most dealership extended warranties are limited to just a few.

To learn more CARCHEX’s flexible plan options and find the best fit for your vehicle, call 866-261-3457 and get a free quote.

CARCHEX Extended Vehicle Protection Plans

The friendly customer service representatives at CARCHEX work with you to determine which coverage level is best for your vehicle. With five levels of coverage and a variety of plans within each level, CARCHEX has an option for every budget.

  • Titanium Coverage—This level of coverage offers the most protection for your vehicle. Often known as a bumper-to-bumper warranty, this is the most comprehensive extended warranty with options for 10 years of coverage.
  • Platinum Coverage—This level provides the highest level of stand component coverage and can protect your vehicle for up to 10 years.
  • Gold Coverage—Usually the best fit for vehicles with over 60,000 miles, this extended warranty provides flexible terms and up to 10 years of coverage.
  • Silver Coverage—Great for vehicles with high mileage, this plan covers the major systems of a vehicle for up to 7 years.
  • Bronze Coverage—Designed to cover the costliest repairs, this protection plan is available for a term of up to 6 years.
CARCHEX Vehicle Protection Plans

What Sets CARCHEX Apart?

Many third-party extended warranty providers offer similar coverage plans, such as powertrain or bumper-to-bumper, but not all extended warranty brands have the same level of customer service, reputation, and cost-effectiveness.

CARCHEX has more experience and high BBB ranking among its competitors, with higher customer satisfaction and a host of endorsements and reputable partnerships. Compare our performance with competitors in the chart below.

CARCHEX Protect My Car AutoAssure autopom! Endurance
Years in Business 21 14 9 10 14
BBB Rating A+ Not Rated B A+ C+
Partnerships & Endorsements CARFAX, RepairPal, Edmunds.com, Autoblog, Sirius XM, Vehicle Protection Association, Goss’ Garage ACVPP, Contact Center Compliance, DataOne Software Vehicle Protection Association, Dun & Bradstreet Verified Trustpilot Courtney Hansen, Katie Osbourne, and Vehicle Protection Association

Updated May 2020

What Other Benefits Does CARCHEX Offer?

  • Roadside assistance, including gas delivery, towing reimbursement, and trip interruption coverage
  • Affordable monthly payment plans that fit your budget
  • A hassle-free claim process
  • Easily accessible contracts online
  • A network of more than 30,000 authorized mechanics
  • Claims paid directly to the repair facility
  • Customized help from our CARCHEX Extended Vehicle Protection specialists
  • No inspection required

CARCHEX Customer Reviews

At CARCHEX, our customers are pleased with our Extended Vehicle Protection Plans and customer service. We boast a 99.9% customer satisfaction rating and grade of A+ on Better Business Bureau, as well as accreditation since 2009.

Here are a few reviews from our customers:

“Outstanding customer service representative answered all questions. Also spoke with her supervisor who also was very knowledgeable and friendly! I was very impressed with the professional service and would highly recommend to anyone needing their product.” – Gerald

“My alternator went out on my 2011 Nissan Maxima. I called CARCHEX to set up a claim within minutes they told me it was covered under warranty. CARCHEX saved me a lot of money!” – Jackema

I compared warranties, and this company offered the best deal with the most coverage. [The representative] explained everything to me in detail, which made my decision easy. - Troy”

“The representative I worked with was very knowledgeable, helpful and not pushy. Talked where I could understand him and explained everything very well.” – Cynthia 

“Warranty coverage is top rate. Advisors are willing to provide feedback to ensure clients purchase exactly what they need. Coverage details are clear and easy to understand. Coverage prices are comparable to other warranty providers.” – William

Protecting Your Vehicle with an Extended Warranty

Purchasing a vehicle service contract can protect you from unforeseen repair costs. The coverage offered by an extended warranty may save you hundreds, and possibly thousands, of dollars in repairs to your vehicle.

Find out if an extended warranty is right for you by speaking with a trusted provider like CARCHEX and asking the important questions regarding coverage. Call CARCHEX now at 866-261-3457 for a free quote.



ConsumerFinance.gov: https://www.consumerfinance.gov/ask-cfpb/what-is-an-extended-warranty-or-vehicle-service-contract-en-729/

Business Dictionary: http://www.businessdictionary.com/definition/extended-warranty.html

Forbes: https://www.forbes.com/sites/jimgorzelany/2016/08/16/despite-better-cars-roadside-rescues-are-rising

RepairPal: https://repairpal.com/estimator/bmw/x3/head-gasket-replacement-cost

RepairPal: https://repairpal.com/estimator/chevrolet/silverado+1500/lower-ball-joint-replacement-cost

RepairPal: https://repairpal.com/estimator/ford/mustang/fuel-pump-replacement-cost

RepairPal: https://repairpal.com/estimator/nissan/maxima/oxygen-sensor-replacement-cost

CarComplaints: https://www.carcomplaints.com/Honda/Civic/2016/AC_heater/AC_not_working_properly.shtml

CarComplaints: https://www.carcomplaints.com/Mazda/CX-5/

CarComplaints: https://www.carcomplaints.com/Subaru/Outback/2015/windows_windshield/cracks_easily.shtml

CarComplaints: https://www.carcomplaints.com/Jeep/Wrangler/2014/engine/oil_housing_leak.shtml

CarComplaints: https://www.carcomplaints.com/Honda/Accord/2013/electrical/starter_failure.shtml

CarComplaints: https://www.carcomplaints.com/Subaru/Forester/2014/suspension/broken_coil_springs.shtml

Edmunds: https://www.edmunds.com/auto-warranty/warranty-and-roadside-assistance-coverage.html

The Balance: https://www.thebalance.com/average-cost-of-renting-a-car-4177232

Phys.org: https://phys.org/news/2018-04-car-warranties.html

U.S. News and World Report: https://cars.usnews.com/cars-trucks/rankings/used

FTC: https://www.consumer.ftc.gov/articles/0138-auto-warranties-routine-maintenance

Better Business Bureau: https://www.bbb.org/us/md/hunt-valley/profile/extended-warranty-contract-service-companies/carchex-0011-23015869

LACountry.gov: http://dcba.lacounty.gov/portfolio/service-contracts-and-extended-warranties/

Edmunds: https://www.edmunds.com/car-reviews/consumers-most-popular.html

NEA Member Benefits: https://www.neamb.com/your-car/is-an-extended-car-warranty-worth-the-cost

CARCHEX 118 Shawan Road, Suite 210 Baltimore, MD 21030 (FL License # E155490)

© 2018 Carchex. All rights reserved.

We proudly offer the CARCHEX No-Haggle, Lowest Price Everyday Guarantee™ for all of our auto warranty and car inspection programs.
Consistent with consumers’ understandings and expectations of the market in which CARCHEX operates, CARCHEX uses the terms “warranty”; “extended warranty”, “extended auto warranty”, “extended service protection plan” and similar terms to describe the more technical term “vehicle service contracts”. For more information, see this FTC link or learn more here or by reviewing CARCHEX’s website.
CARCHEX markets and sells extended warranties on behalf of third party extended warranty providers, and your extended warranty will be between you and the provider. This website site is intended solely for the purpose of providing general information regarding the purchase of extended warranties. Specific contract terms, rates, taxes, fees and other charges are determined upon validation of vehicle information and acceptance by the extended warranty provider, for which CARCHEX is not responsible. Extended warranties may not be sold where prohibited by law.
CARCHEX 118 Shawan Road, Suite 210 Baltimore, MD 21030 (FL License # W469753)
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