Is an Extended Car Warranty Worth The Extra Money?
When people purchase new or used cars, they often forgo the extended car warranty. They believe that they will never use the benefits provided, so why spend the extra money?
An extended car warranty offered by a dealership is often very expensive, ranging into several thousands of rands. Dealers build their commissions into these agreements, which can inflate the price of a warranty from a few thousand rands to tens-of-thousands of rands. The dealers scare consumers into thinking that they must purchase this service contract immediately or face exposure in the future.
The truth is that the new or used vehicle owner does face exposure once the manufacturer service agreement expires. The falsehood is that the individual must purchase the extended service contract from the dealer. Private agencies offer extended car warranties at a fraction of the price and they are just as easy to obtain. Consumers should do an online search and complete a short form to get a price quote from the most reputable providers.
The extended car warranty provides extensive coverage with low excesses and budget-friendly monthly payments. Under some policies, the individual can have the vehicle serviced at any RMI approved repair facility. The vehicle owner will only need to pay the excess (in instances where it is applicable) because the vehicle warranty company and the repair shop will typically coordinate the remaining payment.
A vehicle owner who has an extended car warranty does not need to worry about huge bills for most repairs that may be required. He or she only needs to budget for the low monthly payment required to hold the product or plan. The additional excesses usually range from zero to a few thousand, a small price to pay for a major repair to an engine or transmission.
Still not convinced?
Reasons Why an Extended Car Warranty is Worth the Extra Money
Extended warranties can cover items not included in factory warranties. Every new car comes with a factory warranty, which typically covers specific mechanical breakdowns for a set amount of time. You might consider extra coverage on a new car because factory plans often don’t include perks such as round-the-clock roadside assistance and towing.
Once the factory warranty expires, you’ll be responsible for all repair costs. But you can make sure you aren’t hit with large out-of-pocket expenses by getting an extended car warranty, which picks up when the factory warranty ends.
Aging cars are prone to frequent, costly breakdowns. With extended vehicle protection, you can rest easy knowing that a factory-like warranty is covering your auto asset.
You’ll lock in savings upfront. If you go ahead and buy an extended warranty on your new car, you’ll save money. That’s because as a car ages, the cost of extended protection goes up. If you buy one sooner, rather than later, you’ll pay less for the extended warranty.
You’ll protect yourself against inflation. When you buy an extended car warranty, you get a fixed price at the time of purchase. However, auto parts and the cost of labour are subject to inflation. As long as your repairs are included in your plan, they’ll be paid for no matter how much the cost of repairs has gone up since you purchased your plan.
You’ll save time by eliminating haggling. With an extended protection plan, you take your car into the shop, and they deal directly with the provider administrator. Those two parties handle payment, so you won’t have to deal with haggling on the price of expensive repairs.
Extended warranties offer extra perks. Some extended warranties can include 24/7 roadside assistance, a locksmith on call for when you accidentally lock yourself out, and your choice of licensed repair facilities, including dealerships or personal mechanics. Some warranties (such as those provided by Motorvaps) also allow for accommodation in the event your car breaks down more than 100km’s from home.
If you sell your car, a warranty can give it added value. Extended warranties often are transferable, which can improve the chances of selling your used car at a higher price.
So in summary, YES, extended warranties are worth it every single time.