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Extended Warranties

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Comments

  • I'm not intending to but I just want to have an idea.

    Are there any fees to pay for?
  • KCRamKCRam Mt. Arlington NJPosts: 3,516
    Hi ambet

    Any cancellation provisions and requirements should be in the contraxt you received when you purchased. Every company is different in terms of how they handle cancellations - some pay in full, some pro-rate.

    kcram
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  • 2crnot2c2crnot2c Posts: 27
    In the case of WG, the contract is of no use. I cancelled withing their 60 review period. Even though the contract mentions that I should get back all the money I spent, the reality of the matter is that I am stil waiting to see 1 cent.

    Once money has left your hands, do not expect that you will see it again.
  • Kirstie_HKirstie_H Posts: 11,077
    A newspaper reporter would like to talk with Smart Choice automotive warranty customers. Please respond to [email protected] with your daytime contact information by Tuesday, August 19. Thanks!

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    Need help navigating? [email protected] - or send a private message by clicking on my name.

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  • I just purchased an 01 Yukon XL. I have 6k miles before the manufacturer's warranty runs out. This thread is a little bit too in the weeds for me.
    I just need some advice on extended warranties... or whatever you want to call them... are they worth it or no?

    If they are worth it, can I get some guidance on where to go for the best deal?

    Thanks much
  • zueslewiszueslewis Posts: 2,353
  • After the whole Warranty Gold thing I will never recommend a warranty for a car. The one guy is right, put the money in the bank if you have it do a 6 month cd or something just so you can't take it out. I'll never trust another company again. I would maybe only consider a warranty through the dealership because they would have to honor it.
  • dopleedoplee Posts: 16
    AAA has a referral program of offering extended warranties through Direct Vehicle Service Contracts. I checked them out via web www.directservicecontracts.com and spoke with their rep. It's a written contract with Lyndon Insurance. They are rated A- by AM Best. I've read so much stuff on extended warranties on edmunds that I really don't know what is true or false. I haven't read anything on the boards about Direct Vehicle. From my due diligence, this is what I liked about Direct Vehicle: they pay for the repair via corporate credit card directly to the dealer/repair shop instead of me footing the bill first and being re-imbursed; Rated A- by AM Best; good standing with Better Business Bureau; and no interest financing, but I'd like to see if anyone heard or had any experiences with Direct Vehicle.

    Thanks in advance
  • q45manq45man Posts: 416
    The obvious problem with extended service contracts is they have to charge enough to cover what they pay out and the sales commission and operating costs.....to stay in business!

    $1,000 may be enough for a Honda or Camary 4 cylinder or a small pickup but I doubt it. Only if they exclude a lot of things that wear out slowly [rubber isolators and hoses belts, wear and tear items, tires, brakes,].

    The other problems are how to force owners to pay for a level of fluid/system maintenance that will assure the vehicles longevity and not allow claims.

    People who make a living studying these things have concluded that some where around 7 cents [5-10 cents range depending on vehicle]per mile from day one is necessary but few owners pay out $7,000 in repairs and preventative maintenance over 100,000 miles of use. So the car becomes worn and repairs are just waiting to happen. From 100k to 200k the cost can almost double to 12 cents per mile on lux V8 cars.
    Not checking alignment and keeping tires balanced can wear rotors, suspension bushings, and wheel bearing from the excess vibration.......is that not the owners fault.

    http://www.jsonline.com/wheels/peak/apr03/131172.asp
    http://www.stretcher.com/stories/990308e.cfm
  • Hi:

    Just purchased 03 Honda Accord Sedan 6 cylinder in California. Looking for an extended warranty of 6/100K w/ no deductible. Honda is willing to give it to me for 855 dollars, while Warranty Direct can give me 1122 dollars. However, Warranty Direct claims that it has 3 better advantages than Honda.
    1) I can take it to any repair shops (which I'm just gonna to Honda anyway..so this is not a real benefit)
    2) They said they " offer a broader level of coverage commonly called wear-and-tear. [Honda] only offer mechanical breakdown. In short, we will cover a much broader range of repairs than they will."
    3) "[Warranty Direct] offer a bumper-to-bumper coverage. By definition, a bumper-to-bumper plan is exclusionary, that is, it will only list the few components not covered. This is a Federal Trade Commission definition. Typically these include cosmetic, consumable and maintenance items. If a plan lists the items that are covered, it is NOT a bumper-to-bumper plan

    The Honda plan is a named component coverage. "Named component" coverage plans such Honda provide a list of the parts that are covered. While they may offer a high level of coverage, they are not bumper-to-bumper."

    So, I mean..I believe what Warranty Direct is saying...but are they really better? What do you think? Any other companies might be better than them?
  • zueslewiszueslewis Posts: 2,353
    "They said they " offer a broader level of coverage commonly called wear-and-tear. [Honda] only offer mechanical breakdown. In short, we will cover a much broader range of repairs than they will."

    I'll never believe that warranty direct, or any other private service contract company, would cover wear items like brake pads, wiper blades and tires.

    The only exception is if a brake caliper failed and trashed the brake pads - in that case, the pads would be covered, but not as a wear item.

    Sounds like a smoke job to me.
  • 2crnot2c2crnot2c Posts: 27
    Aristopac, please review the Warranty Gold Claims chain. People like me have been screwed by purchasing 3rd party contracts. Warranty Direct will definitely praise their plans. Tell me which company's sales person in their sane mind will tell you, "Hey, do not get our stuff because we are lousier than company XYZ". When I purchased my contract in the end of May 2003, I was deciding between Warranty Gold & Warranty Direct. I even cancelled the Chrysler plan that I had initially bought. Warranty Direct did give me the same sales pitch. Warranty Gold also mentioned their advantages (it was also costlier). I finally chose Warranty Gold as they were locally located (in Austin, Texas) and thought that if I had a problem with a repair, I could always drop by and speak to them personally.

    Then came the NWIG fiasco. This bankruptcy by an insurer/administrator can happen to any company. Warranty Gold has been in the business for a great number of years. My dealer had a lot of praises for it. After the NWIG problem, Warranty Gold has paid no one and have not returned by money that I paid (even though I cancelled within their 60 day review period). This can happen to any 3rd party company.

    My suggestion is to go with the Manufacturer's plan. Once I get my money back from WG (a big if), I am planning to get the best deal with the Chrysler's plan. You may want to check whether Honda Care has an exclusionary plan. I know Chrysler does. When I bought my minivan from them at the end of January, my dealer did not know of the Exclusionary plan. I found that out myself.
  • #noname#noname Posts: 58
    Wow..this is the first time I post questions on Edmunds.com, and within an evening, I have already received two very valuable advice. Thank you very much! =) I have decided to go with the Honda warranty. (^_^)
  • Good choice, aristopac. I could never in good conscience recommend purchasing a third party warranty to a consumer. The fact that the official Honda policy is actually less expensive makes going with them a slam dunk.

    Car_man
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  • disco99disco99 Posts: 74
    I read direct service contracts' contract recently-there is zero mention of paying claims with a corporate credit card-instead I read about their "reimbursement procedures". again they were very cordial and prompt to my requests-but the "corporate credit card payments over the phone" process was not in the contract I read--
    good luck
  • zueslewis said:

    "I'll never believe that warranty direct, or any other private service contract company, would cover wear items like brake pads, wiper blades and tires."

    Warrantydirect does not claim to replace tires, wiper blades, etc. I've reviewed their contract on www.warrantydirect.com, and they specifically exclude these items. The "wear and tear" items they refer to are gaskets and seals.

    It cost me $1,000 to replace the head gasket on my Accord at 95,000 miles -- I wish I'd had a service contract!
  • zueslewiszueslewis Posts: 2,353
    are NOT, repeat NOT wear and tear items. They are enclosed portions of assemblies, like the head gasket, the intake manifold gasket, the EGR gasket, the rear main seal, the transmission pump seals, etc.

    I don't care WHERE this service contract company gets their definitions for their "contracts", there's not a service department/shop in the world that considers a headgasket a "wear item".

    In the service business community (and I am a court-certified automotive expert allowed (127 times) to testify as an expert in automotive repair and maintenance) "wear items" are wiper blades, brake pads, tires, light bulbs, etc. Period. Again.

    Run away, quickly, from any company that lists seals and gaskets as wear items.
  • redline65redline65 Posts: 693
    I guess your opinions don't necessarily reflect those of Edmunds.com, as it appears that WarrantyByNet is a sponsor. Kudos to you for not recommending the 3rd party warranties, enough people have learned this lesson the hard way.
  • zueslewiszueslewis Posts: 2,353
    I could never in good conscience recommend ANY private warranty company, especially those found over the internet.

    The only possible exception is a dealer-sponsored warranty provided for someone who never travels, but still a factory-backed program is better all around.
  • tballpetballpe Posts: 2
    I am ready to buy a new Jetta, which I plan to keep for at least 100,000 miles. I am interested in the extended warranty, (VW's Real Driver product). Although the dealer has offerred a great price on the purchase of the car, it feels as though he is not as generous with the price of the warranty, which is $1700 for zero deduct, or $1500 for $100 deduct. What is the "wholesale" price that I should expect as a negotiation target for the VW plan?
  • KCRamKCRam Mt. Arlington NJPosts: 3,516
    hi tballpe

    Unfortunately, that is like asking what the invoice price is on an oil change. While cars have the whole MSRP/Monroney label regulation and publically released invoices, the extednded warranty is not part of the car and is not subject to the same release of information. The best thing you can do is shop around - all VW dealers can sell you the factory plan, so call a few and ask about the same coverage.

    kcram
    Host
    Smart Shopper and FWI Message Boards
  • Thinking about a 1999 Saab plus a warranty. Any one ever hear of an outfit America's Choice out of Pa. Any know if the AAA extended is any good.
  • There was a recent story in a Chicago newspaper about extended warranties offered by National Warranty and Warranty Gold (both the same company apparently). The underwriters for their extended warranties went into default and the company stopped paying for repairs on vehicles. You can check the story out at this webiste
    http://www.chicagotribune.com/news/chi-0308300254aug30,1,253598.s- tory
    The moral of the story is, take care of your car and pocket any money you'd put towards an extended warranty. You'll be better off in the end if you simply pay for your repairs when the situation demands.
  • For further information on the rise in complaints on extended warranties (along with more information on the state of National Warranty which is now insolvent) check the following website
    http://www.consumeraffairs.com/auto_warranty/
  • I'm glad the article went through on Saturday from the Chicago Tribune. I've filed complaints with everyone and didn't even think to file with the Illinois attorney general. According the rest of the article in the Trib only 12 people have complained in Illinois. I'm sure there's more than that in Illinois. I mainly thank the Edmunds site for hooking me up with the Trib. Rick Popley did an awesome job on the story. I love the fact that Kurt from WG says it was highly unlikely that I wasn't told about the insolvent NWIG. Wow, let's think about that. Would anyone in their right mind continue to pay a company that they know wont pay there claims? Would a person say "hey let me send you my $1100 check any way?" They still continue to lie. The other women told me "your salesman shouldn't have taken your check". I told her then send it back, she told me the rest of my money after 6-6-03 was sitting in the WG account. Why won't they give it back? WHATEVER! I've emailed the general manager at WG like 4 times and he has yet to grant me a response. I emailed Walter Jacobson on Fox in Chicago so I'm hoping he got wind of the newspaper article.
  • ateixeiraateixeira Posts: 72,587
    So they ran away to the Cayman Islands with your money, and bribed some politician to keep creditors out of that country. Nice...

    Just stick with OE warranties. My cousin got one for his Honda, well under a grand for 7/100 no ded, I did the same for our Subie.

    The manufacturers are more likely to be alive in 7 years, Daewoo and Daihatsu excepted. You also get roadside assistance included, free loaner car (upgraded, we've used this benefit already), and better resale down the road, give our plan to sell with 96k miles. ;-)

    Sorry 'bout all the horror stories here, but just wanted to share one positive experience with them.

    -juice
  • Hello, I have read this post title and it has grabbed my attention.
    I currently have an extended service contract which was purchased from the Ford dealer where I purchase my used car from.
    My car currenlty has bearings which "wore" out and a damaged crank shaft which was scratched from the "Worn" out bearings.
    The contract specifically states "internally lubricated parts" are covered.
    BUT the warranty company REFUSES to cover the bearings becuase they say they were "worn" out.
    And since the worn out bearings are not covered, they will not cover/repair the crankshaft which was damged by the uncovered bearings.
    Please, is there anything that can be done towards service contracts and legality.
    It specifically states the parts (interannly lubicated) parts ARE covered, but it's totally contradicted by the company saying "worn" items are not covered.

    How can an illegal warranty be disputed??
    Please help.

    The repair costs were estimated aroudn 2k.
    Please direct me to help.

    -draknad
  • zueslewiszueslewis Posts: 2,353
    internally lubricated parts - I'd call the warranty's administration or customer service line.

    No offense, but this another real, great, tried and true reason NOT to buy an aftermarket (private) service contract.
  • q45manq45man Posts: 416
    Bearings don't wear out till after 100k [some engines go 300-500k] UNLESS the oil wasn't change every 90 days [severe service schedule]. Owner abuse is not covered and is their way out to deny coverage.

    Repair only $2,000 is pretty low for a crank and its bearings -----4-6 cylinder? What about the rod bearings and piston wrist pins and piston rings, bores?
  • zueslewiszueslewis Posts: 2,353
    what'd they say about your oil change documentation - or are we not getting the whole story here?
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