Pros and Cons of Extended Car Warranties
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If you own a car, you know how valuable it is. With an asset this important, it’s smart to consider the pros and cons of an extended car warranty.
All new cars come with factory warranty protection for your car’s major components and systems, but these typically only protect your car for three to five years after purchase. Buying a car is a major investment, and purchasing extra protection for it could actually save you money on the cost of car ownership down the line. Let’s weigh the pros and cons of extended car warranties and see how these protection plans could bring you peace of mind on the road.
If you’re ready to start comparing coverage and prices, get a few free, personalized quotes from our top choices for the industry’s best extended car warranty companies.
Table of contents
Pros of Extended Car Warranties
An extended car warranty can offer excellent protection for your vehicle at a reasonable price. Below are some pros of getting an extended car warranty:
Vehicle Protection Plans Can Save You Money on Car Repairs in the Long Run
Extended auto warranties can be expensive, but paying for coverage monthly can help you avoid having to pay for sudden, major repairs in the future.
Many extended warranties come with a $100 deductible. This means that if you bring your car into the shop for a covered repair, no matter how expensive the parts and labor are, you’ll only pay $100 at the time of service.
Some cars need extended warranties more than others, but having extra protection never hurts. If your car falls into one of the following categories, an extended car warranty could be a good idea for you:
- Your factory warranty has expired.
- You drive a luxury car.
- You drive a high-mileage vehicle.
Extended Car Warranties Are Good for Peace of Mind
Buying an extended warranty is always a good idea to bring you peace of mind on the road. Some cars will benefit more from extended warranty protection than others. We recommend car owners research the reliability of their vehicle so they don’t pay for coverage they don’t need or won’t use.
You Can Transfer Your Extended Warranty to a New Owner
Some providers do not allow the transferability of an extended warranty, but most do. If you want to sell your vehicle, you can increase its value by transferring the extended warranty to get more money from the sale. Or, if you give the car to a family member or friend, they will not have to worry about buying a new extended warranty.
Third-Party Extended Car Warranty Companies Have Highly Customizable Coverage Options.
When you’re buying an extended car warranty, you have the choice to buy from your car’s manufacturer or from a third-party extended warranty provider. Here are the pros and cons of extended car warranties from the manufacturer:
Pros of Manufacturer Warranties |
Cons of Manufacturer Warranties |
|---|---|
Guaranteed original parts for repairs and technicians trained specially to repair your car |
Repairs must be done at the dealership |
Plans tailored to your car’s specific needs |
May need to purchase extended warranty at time of vehicle purchase |
Can be more expensive than a third-party warranty if you roll the plan into your vehicle financing |
Extended car warranties from third-party providers have advantages and disadvantages, too. Let’s review both so you can make the best vehicle protection decision for your car.
Pros of Third-Party Extended Warranties |
Cons of Third-Party Extended Warranties |
|---|---|
More customizable coverage options and payment plans |
Not all plans come with guaranteed original manufacturer parts for repairs |
Repairs can generally be performed at the dealership or any technician certified by the National Association for Automotive Service Excellence (ASE®) |
Cons of Extended Car Warranties
Extended warranties can be budget-friendly and help you save money in the long term. However, there are some downsides to purchasing an extended car warranty. Read below to find out:
An Extended Warranty Can Be Expensive
Above, we stated that an extended car warranty can help you save money in the long term. However, if you do not get the right plan for your needs, you can pay much more than you expected.
This is why it is important to research multiple providers and what coverages are offered.
Extended Warranties Don’t Cover All Repairs
If your car is damaged in a collision or by weather, your extended car warranty won’t cover repairs. It would be a better idea to file a claim with your insurance company for those damages. Extended car warranties only cover repairs and replacements of certain parts after a breakdown.
You May Never Use the Extended Warranty
Extended car warranties are a good way to protect your finances from the cost of expensive repairs if your car breaks down. That being said, there is no guarantee that your car will break down. You could be paying for coverage that you don’t need.
Are Extended Car Warranties Worth It?
Extended protection could be worth it if:
- You plan on keeping your car for a longer period of time than what is covered by the manufacturer’s warranty.
- You plan on selling your car and want it to be more appealing to prospective buyers.
- You own a high-mileage vehicle that is likely to break down.
- Your car has expensive technology or manufacturer-backed accessories.
Buying an extended warranty for your car might not be worth it if:
- You feel confident that your car will not require any unforeseen repairs due to breakdowns.
- You would rather pay for repairs out of pocket.
When weighing the pros and cons of extended car warranties, it’s a good idea to ask yourself if you would feel comfortable facing the cost of common car breakdowns. Here are some of the more expensive repairs and replacements you might encounter, according to RepairPal.
Air conditioning compressor replacement |
$1,330.50 |
Power window motor replacement |
$312.35 |
Timing chain replacement |
$1,281.60 |
Alternator replacement |
$708.50 |
Starter replacement |
$596.95 |
Fuel pump replacement |
$1,317.10 |
Breakdowns can come out of the blue, and even the most reliable car can have expensive repairs throughout its lifetime. The best way to be prepared for these costs is to buy a vehicle service contract before a breakdown occurs. No matter which car you own, we think extended vehicle protection plans are a worthwhile investment.
Pros and Cons of Extended Warranties: Conclusion
- Vehicle Protection Plans Can Save You Money on Car Repairs in the Long Run
- Extended Car Warranties Are Good for Peace of Mind
- You Can Transfer Your Extended Warranty to a New Owner
- Third-Party Extended Car Warranty Companies Have Highly Customizable Coverage Options.
Cons:
- An Extended Warranty Can Be Expensive
- Extended Warranties Don’t Cover All Repairs
- You May Never Use the Extended Warranty
Best Extended Car Warranty Companies
When you decide to purchase an extended auto warranty, you have many choices for coverage. You can buy coverage from the automobile manufacturer, although you may need to purchase it at the time you purchase the car. Or you can buy from a third-party extended warranty company anytime.
Our review team has researched the extended warranty industry extensively. Some top warranty companies that you can count on for reliable protection include Endurance, CARCHEX, and CarShield.
#1 Endurance: Best Coverage
Endurance is our choice for the best extended warranty provider in the industry because of its high customer service ratings and great coverage limits. An Endurance extended warranty could cover your vehicle for up to 8 years or 200,000+ miles.
Endurance plans come in five tiers of coverage:
Supreme |
Exclusionary, bumper-to-bumper plan |
Superior |
Second highest level of coverage |
Secure Plus |
Powertrain plus coverage |
Secure |
Affordable powertrain coverage |
Select Premier |
Coverage for high-mileage vehicles |
EnduranceAdvantage™ |
Covers mechanical breakdowns as well as maintenance |
All extended warranties from Endurance come with one year free of Elite Benefits, which includes:
- Up to two tire replacements or repairs per year
- 24/7 roadside assistance
- Key fob replacement
- Total loss protection
- Collision discount
- Endurance mobile app
Our rating: 4.6 out of 5.0
Endurance is our pick for best coverage with its comprehensive warranty options.
#2 CARCHEX: Best For Used Cars
CARCHEX is another top warranty provider trusted by motorists across the country. With an A+ rating from the Better Business Bureau (BBB) and a 3.2- out of 5.0-star rating from TrustPilot, CARCHEX can be trusted to bring reliable protection to your car.
CARCHEX has been in business for 22 years and has won many awards over the course of the company’s lifetime. You’ll get a 30-day money-back guarantee with any CARCHEX policy.
Here are the coverage levels you can get with CARCHEX:
Titanium |
Highest coverage level similar to a bumper-to-bumper warranty |
Platinum |
Comprehensive coverage for hundreds of components and major car systems |
Gold |
Designed to cover the unique needs of vehicles with more than 60,000 miles on the odometer |
Silver |
Covers your car’s major systems |
Bronze |
Powertrain warranty that protects your car from the most common repairs to the engine and transmission |
Some benefits to a CARCHEX extended car warranty include roadside assistance, towing benefits, rental car reimbursement, gas delivery, and trip interruption services.
Our rating: 4.4 out of 5.0
Our research found this provider to be the best for used cars.
#3 Protect My Car: Best Financing
CarShield topped our list for the best extended warranty for financing the cost of coverage. In our Protect My Car review, we recognized the provider for having great financing options. Take a look at Protect My Car's different coverage levels to find out which plan is best for you:
Supreme |
Bumper-to-bumper coverage |
Select |
Designed for vehicles over 50,000 miles |
Driveline |
Coverage for high-mileage vehicles |
Some perks to getting an extended car warranty from Protect My Car include:
- 24-hour roadside assistance
- Towing
- 30-day money-back guarantee
To find out how much you would pay for an extended auto warranty from Protect My Car, get a free quote for your vehicle.
Our rating: 4.3 out of 5.0
Protect My Car is our pick for best long-term financing.
Methodology
- Price: Comparing providers can be difficult due to the many factors that influence cost. To determine this score, we employ a secret shopper analysis using different vehicles, mileages, warranty plans, and locations.
- Coverage: A wide variety of coverage is essential to support the differing needs of customers. We take into account the number of extended car warranty plans available, term limits, exclusions, and additional benefits.
- Customer Service: The level of customer service and care provided by an extended warranty company is an important consideration. Our review team sifts through customer reviews and complaints from reputable sources such as the Better Business Bureau (BBB) and Trustpilot. We also consider the responsiveness of each company’s customer service team based on our secret shopper analysis.
- Reputation: Good extended warranty providers consistently provide quality experiences. Our team takes into account BBB ratings and the company’s history of reliable service when giving this score.
- Transparency: Customers value a commitment to open and honest communication when it comes to vehicle service contracts. Our team of experts takes into account the availability of money-back guarantees and sample contracts.
Stephen Kenney is a writer and editor who focuses on car insurance, auto financing, and vehicle shipping services. He's a graduate of UNC-Chapel Hill and has experience covering categories ranging from travel to sports to environmental sustainability. In his free time, Stephen enjoys going on long-distance runs, trying out new recipes, and exploring his adopted hometown of Cincinnati.
More by Stephen Kenney
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