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Should I Buy an Extended Warranty?

If you’re asking yourself if you should buy an extended car warranty, you’re not alone. Many drivers have a hard time knowing when they should purchase coverage for their cars and if the investment will be worth it.

The experts at CARCHEX will walk you through the benefits of an extended warranty and help you craft the perfect plan for your specific coverage and pricing needs. To receive a quote from us, call 866-261-3457 or fill out the online form.

Why Should I Purchase an Extended Warranty?

Are you in a position to drop a lot of cash on a single repair? A recent study from CarMD showed that the cost for a car repair continues to rise with a 6.5% increase from 2017 to 2018. The average check engine light repair cost is now $380 because of the increase in both labor and part costs. Here are some of the most common vehicle repairs and their costs:

Repair Cost
Ignition coil replacement $218
Oxygen sensor replacement $244
Mass air flow sensor replacement $340
Fuel injector replacement $450
Thermostat replacement $245

Though new cars hold up better than aging ones, all car owners will encounter that costly, unexpected repair bill at some point. An extended warranty can help offset those costs.

Can You Afford To Pay These Repair Costs?

Here are other factors to think about as you consider buying an extended warranty:

  • Looking to sell your car in the future? Extended warranties can increase your car’s resale value because buyers will be more interested in a car that comes with a transferable warranty.
  • Benefits like roadside assistance and trip interruption services are offered through some extended warranties, so you aren’t stranded when something goes wrong with your vehicle.
  • An extended warranty from the dealership is not your only option. Auto warranty companies like CARCHEX provide plans that offer more flexibility in auto repair shops, levels of coverage, and more.
  • Extended warranties prevent costly repairs from hanging over your head. You can rest assured knowing you can afford repairs when you need them because they are covered under your warranty.
  • Extended warranties, especially those from third-party providers, can be tailored specific to your needs. This means you will only pay for coverage of the components that are likely to cause issues for your make and model.
  • Dealerships and some third-party companies like CARCHEX will handle all of the paperwork for you during the claims process. They will pay the repair shop directly for services rendered, so you don’t have to wait to be reimbursed.

Is Buying an Extended Warranty Worth the Money?

What does an extended warranty cost? There’s no set price for an extended warranty because it depends on a variety of factors, including:

  • Level of coverage
  • Deductible
  • Make, model, and year of your car
  • Car mileage
  • Warranty provider
  • Your driving habits

A rough estimate for what a dealership plan would cost is $1,000 to $1,500. But a plan with a third-party provider like CARCHEX will be cheaper. For you luxury car owners, consider CARCHEX’s price for an Infiniti. For 2007-2014 models, the average monthly cost is $89 a month.* For you economy car owners, let’s look at Toyota. 2007-2014 Toyotas cost about $56 per month to protect.*

Simply think about the kind of person you are. Not a fan of surprises? If you like the peace of mind that comes with knowing that you’re covered when something unexpected happens, then buying an extended warranty is worth the money.

What to Know Before Buying an Extended Warranty

Protecting your car is important. That’s why it’s smart to do some homework before buying an extended warranty.

Keep these things in mind:

  • Know the Benefits of Extended Warranties
    • New cars come with manufacturer warranties, but an extended warranty can cover the costs that factory warranties do not.
    • Extended warranties can cover roadside assistance, towing, and car rental costs when your vehicle is in the shop.
    • Remember that even a new factory warranty will expire. Buying an extended warranty will ensure your car is protected as it ages and needs more repairs.
  • Beware of Scams
    • Not all extended warranty companies are created equal. Some may try to scam you. Check rankings from Consumer Reports and the Better Business Bureau before you call anyone.
  • Know Your Car
    • How old is your car?
    • How long do you plan to keep it?
    • Do you know the repair history on it?
    • How many miles do you have on it?
    • What types of repairs are common for your model?
Young Latin American woman at a garage talking to a mechanic about her car

When Is the Best Time to Buy an Extended Warranty?

Choosing the right time to purchase an extended warranty may save you money down the road. An extended warranty begins after the bumper-to-bumper manufacturer warranty expires. You can decide to purchase an extended warranty the day you buy the car. You also have the option to hold off until later, but it’s important to know that the price usually increases if you wait until your original warranty expires. We recommend buying an extended warranty right before your factory warranty expires so that you don’t have a gap in your coverage.

Buying an Extended Warranty for a New Car

New vehicles come with a factory warranty that provides bumper-to-bumper and powertrain coverage for a few years. But once that warranty expires, you’re responsible for covering any repairs that may arise. This becomes especially important when considering the high-tech components being used in new cars. These components are going to be more expensive to diagnose and repair than your typical squeaky brakes. An extended warranty will help you cover that cost.

After making such a large purchase on a new car, you don’t expect to be buying another car anytime soon, so you’ll want to make sure this one holds up. An extended warranty is there to make sure your car lasts as long as you need it to before you’re ready to purchase another one.

Buying an Extended Warranty for a Used Car

A recent survey by IHS Markit found the average car on the road in the U.S. is 11.8 years old. As vehicles age and gain more miles, their risk for major repairs increases. Here is what your car may run into as it ages:

Problem Repair Cost
Squeaking/grinding brakes Brake pad replacement $263–$294
Moisture buildup Heater core replacement $758–$975
Failing radiator Radiator replacement $605–$795
Difficulty starting car Spark plug replacement $190–$255
Bouncing car Shock and strut replacement $549–$618

As you can see, owning a used car can be expensive. If more than one of these problems were to occur in one year, you would be paying more out of pocket for the repairs than it would cost for you to buy an extended warranty up front.

Tips for Finding the Best Extended Warranty

If you’re ready to buy an extended car warranty, here are a few tips to help you navigate the process:

  • Don’t Ignore the Fine Print—It may seem obvious, but most people don’t really take the time to read exactly what their contract says. Instead of blindly signing, know your plan and ask plenty of questions.
  • Think Long Term—Eventually, all cars will run into trouble. Thinking about your long-term plan is best when warranty shopping. After all, cars are far more likely to experience problems as they age.
  • Don’t Go Only Halfway—You won’t find much of a difference in price when considering the various levels of coverage. Why not make sure you’re covered? For a few more dollars, you could see huge savings and a long list of benefits.

Still not sure if you should buy an extended warranty? Luckily, the vehicle protection specialists at CARCHEX are here to help.

Extended Warranty Options from CARCHEX

Our industry-leading extended Vehicle Protection Plans are affordable, flexible, and offered in five different coverage levels: Titanium, Platinum, Gold, Silver, and Bronze.

CARCHEX Vehicle Protection Plans

All of our extended warranties include these additional benefits:

  • 24/7 roadside assistance
  • Trip interruption services
  • Gas delivery
  • Towing
  • Rental car reimbursement

Not sure which plan is right for you? Our auto warranty and insurance experts at CARCHEX are here to help you make the best decision for your unique needs. We pledge Customer Experience Above All when you look to us for an extended warranty.

A+ Experience with CARCHEX

Knowing who you can trust will help you answer the question, “Should I buy an extended warranty?” Speaking to knowledgeable representatives from a reputable company can show you how much money you can save with an extended warranty.

CARCHEX has an A+ rating from the Better Business Bureau (BBB) and a long list of endorsements from industry leaders, such as CARFAX, RepairPal, and SiriusXM. CARCHEX uses a consultative approach to offer you the best pricing and a variety of protection plans to suit your needs for your new, used, or certified pre-owned vehicle.

Should a repair arise, we make it easy for you to manage. You get to choose a repair shop that you know and trust. We also handle the paperwork and payment directly with the shop so that you don’t have to cover the cost and wait for a reimbursement.

At the end of the day, if you’re still not happy with your plan, you can contact us within 30 days for a refund.**

Car parts

Call CARCHEX

Talk to a CARCHEX auto warranty specialist to see if you should buy an extended warranty and get your free, customized quote.

866-261-3457

Sources:

Edmunds.com: https://www.edmunds.com/auto-warranty/five-questions-to-ask-before-you-say-yes-to-an-extended-warranty.html

Better Business Bureau: https://www.bbb.org/greater-maryland/business-reviews/extended-warranty-contract-service-companies/carchex-in-hunt-valley-md-23015869

IHS Markit: https://news.ihsmarkit.com/prviewer/release_only/slug/automotive-average-age-cars-and-light-trucks-us-rises-again-2019-118-years-ihs-markit-

CarMD: https://www.carmd.com/wp/vehicle-health-index-introduction/2019-carmd-vehicle-health-index/

Consumer Reports: https://www.consumerreports.org/car-maintenance/car-repair-red-flags-older-vehicles/

RepairPal: https://repairpal.com/estimator/brake-pad-replacement-cost

RepairPal: https://repairpal.com/estimator/heater-core-replacement-cost

RepairPal: https://repairpal.com/estimator/radiator-replacement-cost

RepairPal: https://repairpal.com/estimator/spark-plug-replacement-cost

RepairPal: https://repairpal.com/estimator/front-strut-replacement-cost

*Figure accurate as of May 2017. Average monthly coverage cost is based on the average total price of the Vehicle Protection Plan over a four year coverage period. Actual monthly payments will vary per plan’s payment policy. Individual pricing is subject to change based on the combination of make, model, year, and mileage as well as coverage level and term length.

**Refund methods vary by state. See extended service plan for complete details, including refunds, exclusions and limitations.

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

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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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