Friend was sold third party warranty, not Honda Care need advice

bigdave2018

A friend of mine bought a new CRV in the last few weeks in Southern California and wanted a warranty. They sold him a 100k warranty from Ethos Group for $2200.

From reading various forums it seem like Honda Care is the best and he probably got taken advantage of. But I am not sure about this because I did see some internet postings saying that in some respects it might be better than Honda Care.

I have a couple questions:
1) Is there federal or state law that guarantees he has a right to cancel and get a refund? Or is it a case by case basis?
2) Does anyone know anything about Ethos Group? I am having trouble finding information about this to know if it is any good. I assume that Honda Care is better but I am not sure.

Mr_Shiftright

I haven't seen the type of contract he signed, but generally, yes, under CA law you can cancel such a contract.

They can call the California Department of Insurance Consumer Hotline at 1-800-927-4357

It would probably be better to buy Honda Care, but on the other hand, extended warranty on a Honda is generally not necessary at all.

kyfdx

@bigdave2018

Third party extended warranties with no backing from a manufacturer, are basically insurance companies, that profit by denying coverage. (okay, not explicitly, but would you want to put in a claim to State Farm, when your alternator goes bad?).

I'm sure there is a right to cancel, but expect the dealership to do everything they can to obfuscate the process, If the warranty was $2200, the profit to the dealership was likely over $1000, and they won't want to help, even though they may be obligated.

One thing to note. If the warranty was financed along with the vehicle, any refund is going to go to the bank to reduce the loan balance. In the long term, this doesn't matter, but your friend won't be getting a check back.

Also, time is of the essence. The cancellation period is likely 30-60 days, and with everyone else involved throwing up roadblocks, they should get busy on this, right away.

Obviously, we can't see the contract, but $2200 for a warranty on a Honda? Wasted money.