We’ve all experienced the wonderful feeling of walking into a dealership knowing that when we left it would be in a new vehicle. Whether it is a brand-new vehicle or a pre-owned vehicle I would imagine the feeling of sitting in a new vehicle is the same for everyone. It’s so easy to get wrapped up in the car buying experience; finding the vehicle, test driving, financing, insurance etc., that we forget to ask the car salesman about extended warranty they have pushed on us during the height of the car buying euphoria. Remember, a car salesman’s job is to sell you a vehicle and that includes adding additional cost with things like extended warranty coverage! To help you leave the dealership feeling confident in your decision to purchase extended mechanical and electrical breakdown coverage, I have listed below some critical questions to ask before accepting any extended warranty plan from your car salesman.
1) What is the summary of terms of the coverage?
First, it is important to find out how long the extended coverage is going to last. Warranties for vehicles expire based off either the time or miles assigned with the coverage plan. For example, in 2014 Bob was purchased a 3 year/ 36,000-mile plan for his Chevy Impala. In this example, Bob’s coverage would expire in either 2017 or at 36,000 miles on the odometer whichever came first. A common misconception among most people is that the 3 years/ 36,000-mile plan is an either-or option. For instance, using the example above, in 2017 Bob only has 14,523 miles on his odometer. Although Bob’s coverage has already expired, he thinks he is still covered because he has not yet reached 36, 000 miles. Also, don’t let your car salesman force a coverage plan on you that does not fit your driving habits. If you are a lower mileage driver the focus should be covering the vehicle with as much additional time as possible. If you are an average to high mile driver the focus should be on accepting a coverage that meets or exceeds your annual driving average. Using the example above, Bob’s salesperson incorrectly placed him into a 3 year/ 36,000-mile plan by assuming his yearly driving average was 12,000 miles per year.
2) When does the coverage begin?
When speaking to your salesperson find out when the extended warranty coverage begins. This can be a bit tricky depending on how knowledgeable your car salesperson is about extended vehicle warranties. The main thing you want to know is whether the extended coverage will start at the end of the vehicle’s factory warranty or begin the same year the coverage is purchased.
Example A: Carl buys a brand new 2019 Honda Civic. The factory warranty for Honda is 3 years or 36, 000 miles. During Carl’s visit to the dealership he purchases a 6 year/ 100, 000-mile extended warranty plan. If carl’s extended coverage begins in 2019 then he would only have three years of additional coverage. Whereas if the extended coverage started once the factory warranty expired Carl would get the full six years of coverage he purchased.
3) What components does the extended plan cover and what items are excluded?
Be on high alert when you hear the phrase “bumper to bumper coverage”. It can mislead you into thinking the entire vehicle is covered from break downs or repairs, when in a fact it couldn’t be further from the truth. Remember, a car salespersons job is to sell you a vehicle and using an all- inclusive phrase like “bumper to bumper” coverage is sales language. It sounds great, but it does not offer any specifics. It is advisable to ask your salesperson for a full break down of the items that are covered under your plan. Most extended coverage plans DO NOT cover wear and tear items: oil changes, brake pads, tires, windshield wiper blades, rotors, battery or safety items such as: seat belts and airbags.
4) Where can the coverage be used?
When it comes time to utilize your extended warranty make sure the coverage being offered allows for use at multiple locations. Inquire as to whether the coverage must be used at a specific dealership or if it can be used at any certified mechanic shop nationwide. This is critical if you have a special relationship with a mechanic that you like to have work on your vehicle’s repairs.
5) Are there any additional perks that come included with the coverage plan?
Make it a point to find out every detail about any additional perks that come included with the coverage plan. The more you know about your protection plan the better off you will be when it is time to put the coverage into action. There are three specific perks you should ask about if your salesperson “forgets” to mention them: towing, a rental car, and roadside assistance. It is advisable to request information on how each perk works. The main goal is finding out; how far you can be towed, what the daily amount for the rental car will be (typically $30/day), and if each of these additional perks are covered up front by the plan or if they must be paid out of pocket and then reimbursed.
Approach buying extended warranty coverage the same way you might approach getting professional advice from a doctor or a lawyer. It would be best to speak with a licensed extended warranty coverage specialist about coverage for your vehicle. At Service Protection Direct you can speak with a licensed extended warranty coverage specialist whose overall objective is not to sell you a car, but to find you the right level of coverage based on your vehicles age and miles, driving habits, and budget. Call 1-800-986-3608 to learn more about how we can get you the coverage you need, and not the coverage your car salesperson is trying to sell you!