The decision to purchase a car warranty is an important one, so it’s wise to review the pros and cons of an extended car warranty first.

When shopping for extended warranties, the best thing to do is call around and get quotes customized to your vehicle. That way, you can compare each company’s prices and get a feel for customer service. Get free quotes from some of the best extended warranty companies below:

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Are Extended Car Warranties A Good Idea?

An extended car warranty, also called a vehicle service contract, is a protection plan that takes effect after your original factory warranty expires. The warranty is designed to bring peace of mind on the road. While more likely for older, used cars, unexpected breakdowns can occur at any time. If you own a new car from a dealership, it may still be covered under the manufacturer’s warranty, but be sure to check the fine print, since the factory warranty will only cover auto repairs for a few years after purchase. Every car owner should have a plan for how they will pay for repairs. One way to plan for these costs is by purchasing an extended car warranty.

There are more pros than cons to buying an extended warranty if you can’t afford unexpected repair costs and you plan to keep your car for several years. Read on to learn about some of the most common pros and cons of extended car warranties.

Benefits Of Extended Warranties For Cars

Pro: Save a significant amount of money on costly repairs.

While the reliability of automobiles has improved over time, they are still very expensive to maintain. According to AAA, even new vehicle owners spend about $1,186 yearly to maintain and repair their vehicle.

For example, a common timing belt replacement can cost up to $900 according to Angie’s List. In addition, a broken timing belt replacement may cost up to $2,000 or more if it causes damage to a vehicle’s pistons, water pump, or valves.

If you own an extended car warranty from a reputable provider such as CARCHEX, you would pay a relatively small deductible when your timing belt needs replacement, ranging from $0 to $100. This is probably the most important consideration when comparing the pros and cons of extended car warranties.

Pro: Keep your vehicle instead of feeling pressure to sell it.

If your car needs a costly repair in order to be safely driven, you may feel that it’s necessary to sell your vehicle, even if you would love to keep it.

According to AAA, one out of three U.S. consumers cannot afford an unexpected car repair bill between $500 to $600. If you would like to keep your vehicle and cannot afford a costly repair but could afford a monthly car warranty payment, then buying an extended warranty is a smart decision.

Pro: Customize your protection.

Car warranty providers often allow you to make a partial or fully customized plan depending on your needs. For example, modern vehicles come with complex technological systems, and it is common for these technological systems to fail or need repair.

For an automobile owner who can’t live without their Bluetooth or navigation system functioning correctly, purchasing an extended warranty for their vehicle’s technological systems makes sense. Drivers who don’t rely on these systems can save money by choosing not to cover them.

Cons Of Extended Warranties For Cars

Though extended car warranties can save you significant amounts of money for expensive repairs, they can sometimes cost you more money in the long-term.

If you’re paying $60 a month for an extended car warranty, that is $720 a year out of your pocket. In addition, there is often a deductible whenever you make a claim for warranty coverage. For someone with a very reliable vehicle who can afford a costly repair, an extended car warranty may not be worth it.

Con: You may feel tied down to your current vehicle.

Extended warranties are often cheaper the earlier in your vehicle’s lifespan that you purchase them. If you invest in an extended auto warranty for years, you may feel hesitant to buy a different vehicle. However, many car warranties are transferable, which may help increase resale value.

For automobile owners without an extended car warranty, purchasing a different vehicle may be an easier decision.

Con: Extended warranty plans don’t cover everything.

Some consumers buy an extended warranty plan without reading the details of the plan and are caught off-guard when a needed repair is not covered by their extended car warranty.

Reputable warranty providers will provide you a transparent list of exclusions on their plan. It is wise to read that list carefully before purchasing an extended car warranty.

Our Recommendations For Extended Car Warranties

After considering the pros and cons of extended car warranties, you may decide that an extended warranty is right for you. The first step to finding the best warranty for your needs is to do research and compare prices. We recommend that you shop around for the best price and coverage for your car from top third-party warranty providers.

Get free quotes from our top three picks for aftermarket car warranty companies below:

Best Coverage: Endurance

Endurance offers direct-to-consumer extended warranties, which means that warranty services and claims are handled directly by Endurance.

With Endurance, you don’t have to worry about a middleman or underwritten provider, and Endurance is known for its excellent customer service during the quotes and claims processes.

Additionally, Endurance warranty plans allow car owners to choose from any repair shop certified by the National Institute for Automotive Service Excellence (ASE®) to complete the covered repairs.

Learn more about coverage options in our complete Endurance warranty review, as we rated the company 4.6 out of 5.0 stars. You can also reach out for a free, personalized quote from Endurance below.

Best For Used Cars: CARCHEX

If after reviewing our pros and cons you’ve decided to purchase an extended car warranty, we recommend reaching out to CARCHEX for a custom quote.

CARCHEX maintains an A+ rating and accreditation from the Better Business Bureau, and it has received endorsements from industry leaders like CARFAX, Kelley Blue Book, and Our CARCHEX review rated the company 4.4 out of 5.0 stars.

CARCHEX offers a total of five extended warranty plans, each of which can be customized. All plans include 24/7 emergency roadside assistance, gas delivery, trip interruption services, and lockout services.

Having trouble deciding between Endurance and CARCHEX? Read our Endurance vs. CARCHEX review, and reach out for a CARCHEX quote to see how much you would pay for coverage.

FAQ About Extended Car Warranties


In an effort to provide accurate and unbiased information to consumers, our expert review team collects data from dozens of extended auto warranty companies to formulate rankings of the best providers. Companies receive a score in each of the following categories, as well as an overall weighted score out of 5.0 stars.

  • Industry Standing: Warranty providers with a history of strong business practices and endorsements from experts receive the highest scores in this category.
  • Coverage: This rating is based on types of extended warranty plans available, coverage terms, and added benefits like roadside assistance.
  • Cost: Our research team reviews sample quotes for a variety of plans and vehicles. Companies with lower prices per year of coverage receive the best scores.
  • Transparency: This score takes into account contract transparency and the availability of a money-back guarantee.
  • Customer Service: We comb through customer reviews and perform our own shopper analysis to get a sense of the responsiveness and helpfulness of each warranty company.