Hi, my name is Elizabeth, and I have been running my own business for years. Over the years, I have had a lot of different businesses. I have had home-based businesses, a catering company and several brick-and-mortar shops. Through all of those financial excursions, I have had to buy different types of insurance policies. I have even had to make a few claims. As a result, I have learned all kinds of unusual things about business insurance. If you want to learn about insurance coverage and what your business needs to be protected, take a look at this insurance blog. Thanks for reading and enjoy!
An extended warranty is a repair insurance cover that comes into effect after the standard manufacturer warranty expires. It covers breakdowns, and, in theory, lowers the repair expenses, given that the cost of spare parts and labour is inclined to vary over time. Motorists can purchase an extended warranty even before the standard manufacturer coverage runs out. A motorist should address four key questions in deciding whether to buy an extended car warranty.
How long do you plan to keep your car?
You can be sure that the finance and insurance manager will pose this question to you, and it's worth your deliberation. Are you the kind of person who is fed up with a car by its second or third year? Then purchasing an extended warranty is not a financially wise idea because the car manufacturer warranty will most likely be active the whole time you have the car. However, if you are the kind of motorist who drives a car for a long period until it's completely worn out, then an extended warranty is definitely a valuable consideration.
Who is behind the warranty?
Many dealerships provide third-party insurance coverage from companies with different track records. If you choose to buy an extended car warranty, make certain that a reputed car manufacturer apart from the dealership backs it. Note that you are allowed to use a manufacturer-backed extended car service contract at any dealership throughout the country. In contrast, a third party warranty is often only applicable at the dealership from which you bought it.
What's covered in the extended car warranty?
An extended car warranty is not the foolproof cure that many dealerships suggest it is. The majority of car extended warranties don't cover many car parts that are prone to wear and tear. Also, many extended warranties are available in coverage levels, for instance, gold, silver, platinum and so on. Each level features its pricing and extent of coverage. Are the car repairs entirely covered? Are you expected to foot the car repair bills up front and receive reimbursement later? Or are you expected to part with a small deductible? In this regard, you need to dedicate time to go through the fine print and understand what's covered and what's not.
Do you actually need it?
Finance and insurance managers are often so convincing and may make you feel like rejecting the extended car warranty is a worst decision. You never know when that pricey car repair might strike. However, modern cars are very reliable these days, and that means there's really no need for an extended car warranty. Nevertheless, some motorists aren't ready to take chances or simply prefer the reassurance of a vehicle extended warranty and knowing that major repairs will be catered for.
In the end, consider the above-mentioned key questions prior to making this purchase. For help with the decision, you may want to talk with an insurance specialist from a company like Ian Hewitt & Associates.
Share30 July 2015
