Everything you need to know to make the most of your car’s warranty.
All car manufacturers offer a car warranty on their new and certified pre-owned vehicles. Some are better than others, but essentially, all car warranties protect buyers from costly repairs due to manufacturer defects in materials or workmanship. Below, we’ll review what car warranties do and do not cover, what to do when your manufacturer’s factory warranty runs out, and the best providers for extended car warranties.
In this article:
- What Is A Car Warranty And What Does It Cover?
- What Is Not Covered Under A Car Warranty?
- What Is An Extended Warranty And Should I Buy One?
- Car Warranty Vs Car Insurance
- What’s The Cost Of An Extended Warranty?
- Third-Party Extended Warranty Providers
- Motor1's Top Choice: CARCHEX
- Most Popular: CarShield
- Best Direct Provider: Endurance
- Best Quotes and Claims Process: autopom!
We’ve reviewed every automakers’ warranty ranked from best to worst and learned that the average car warranty last for 4 years/50,000 miles, whichever comes first. Some large-volume automakers like Ford, Toyota, and Nissan offer less warranty coverage at 3 years/36,000 miles, whereas lower-volume automakers such as Genesis and Jaguar offer some of the longest warranty coverage at 5 years/60,000 miles.
Your decision to choose a car brand with a better warranty could potentially save you hundreds if not thousands of dollars in repairs. If you plan on holding on to your vehicle after the warranty terms have expired, don’t think you’re on your own to tackle the expense of repair costs. There are a number of reputable extended car warranty companies that provide the coverage for repair mechanical defects while still remaining within your budget.
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What Is A Car Warranty And What Does It Cover?
Manufacturer warranties on new and certified pre-owned vehicles can generally be divided into three coverage types: comprehensive coverage and powertrain coverage.
Comprehensive coverage, also known as a bumper-to-bumper warranty, will pay for the repair and included labor cost for any defects caused by poor workmanship or manufacturer error.
These repairs include most of your vehicle’s components including:
- Air conditioning and heating
- Electrical components (power windows, door locks, sunroof, etc.)
- Safety components (airbags, seat belts, etc.)
- High tech systems (cameras, GPS, center console, etc.)
- All major vehicle systems (excludes a short list of components)
Powertrain coverage protects from costly repairs to your vehicle’s powertrain. This can include items such as:
- Drive shafts
- Transfer case
Generally, powertrain warranties last longer than bumper-to-bumper warranties with coverage ranging from 4 years/50,000 miles to 10 years/100,000 miles. Some car manufacturers such as Volkswagen combine comprehensive and powertrain coverage into a single warranty, whereas other manufacturers might offer powertrain coverage as an additional add-on warranty.
Though the powertrain is less likely to breakdown than other components on your vehicle (which is why the length of coverage is longer for powertrain warranties), the cost of repair is often much higher. For example, the average cost for a transmission replacement is between $4,931 and $5,107, according to RepairPal.
In addition to bumper-to-bumper and powertrain coverage, your manufacturer’s warranty may also mention protection for corrosion perforation, replacement parts, accessories, seat belts, and emissions control systems. Terms vary widely across brands and contracts, so it’s best to check your vehicle’s specific warranty.
What Is Not Covered Under A Car Warranty?
There are exceptions and exclusions with every car warranty. Typically, you should not expect your car warranty to cover any of these items:
- Regular maintenance (oil changes, tire rotations, etc.)
- Wear and tear items (tires, brakes, brake pads, clutches, windshield wiper replacements, light bulbs, etc.)
- Exterior body damage (door dings and paint scratches)
- Interior damage (holes in the upholstery, broken plastic, etc.)
- Damage caused by driver negligence (skipping regular maintenance, reckless driving, etc.)
- Damage from an accident (exterior dents, broken glass, broken internal components)
- Damage from environmental factors (salt, hail, fire, etc.)
It’s possible that some new or certified pre-owned warranties offer limited coverage on some of the items listed above. For example, there may be a value-added sales promotion to cover all maintenance for the first two years or provide free roadside assistance. However, you should always read the fine print on your car’s warranty to know exactly what’s covered and what the car manufacturer quietly omits. If you do not have a copy of your car’s warranty, contact your dealership for a copy or visit the manufacturer’s website for more information.
What Is An Extended Warranty And Should I Buy One?
When your factory warranty runs out, either from the age of the vehicle or the mileage, you as the owner are solely responsible for any repairs. Depending on the type of repair or frequency of repairs, the cost can be significant. Purchasing an extended warranty from either the manufacturer or a third-party provider will greatly offset the cost of repairs as your car ages and provide you with peace of mind.
You also do not need to wait until your factory warranty runs out to purchase an extended warranty. You can purchase an extended warranty for additional protection not covered in the factory warranty, and the earlier you sign up for an extended warranty, the less it will cost.
Extended car warranties are often broken down into different levels (tiers) of coverage and can last anywhere from one to ten years. Instead of a guarantee from the manufacturer that the vehicle is free of defects from either poor workmanship or mechanical error as in a factory warranty, an extended warranty is a vehicle service contract where the manufacturer or third-party provider promises to pay the cost of a repair should one occur. The owner is then only responsible for a monthly payment and/or deductible as part of the policy.
Car Warranty Vs Car Insurance
Keep in mind that an extended car warranty is not the same as car insurance. For starters, car insurance is mandated by state law, whereas an extended car warranty is optional.
There are also coverage exclusions in extended car warranties that can only be covered through the purchase of collision or comprehensive insurance. If you are involved in a collision with another car or object, you would use collision insurance to pay for the cost of the damage.
Similarly, if your vehicle gets damaged due to vandalism, bad weather, or theft, comprehensive insurance would cover those loses, not your car warranty.
What’s The Cost Of An Extended Warranty?
There are a number of factors that contribute to the final cost of an extended warranty, including:
- Make and Model: Premium vehicles will have a higher warranty cost because replacement parts are more expensive.
- Age: The older your vehicle, the more expensive the warranty because the increased likelihood of repairs.
- Mileage: Higher mileage will drive up the cost of the warranty, even if the vehicle is relatively new.
- Level of Coverage: The more systems covered under your warranty, the more the plan will cost.
- Deductible: Warranties with a deductible will have a lower monthly premium.
- Provider: The provider of your extended warranty can impact the cost of your plan. Dealership extended warranties may get wrapped into your vehicle’s financing, which means you’re paying interest on top of your monthly premium.
Third-Party Extended Warranty Providers
When purchasing an extended warranty, you’re not limited to your automaker’s policy. There are third-party warranty providers that can provide lower cost and more options depending on your needs. We’ve researched and reviewed the leading extended warranty companies based on a variety of different criteria:
- Coverage: Number of plans offered, customization available, contract duration, inclusions or exclusions
- Customer Service: Quote and claims process, money-back guarantee, availability, Better Business Bureau (BBB) accreditation, BBB rating, BBB complaints, sample contracts available online
- Company Reputation: Customer reviews, number of years in the warranty business, partnerships and endorsements
- Additional Perks: Roadside assistance, rental car reimbursement, emergency gas delivery, towing, trip interruption coverage for meals and lodging
Motor1's Top Choice: CARCHEX
No. 1 overall, beating the competition in company reputation, coverage options, and customer service.
Overall, the highest ranking extended warranty company we reviewed is CARCHEX, which scored highest in company reputation, customer service, and coverage options.
CARCHEX has provided extended warranties for 20 years, is fully accredited by the BBB with an A+ approval rating, and has won the endorsement of industry leading companies such as Kelley Blue Book, the Vehicle Protection Association, CARFAX, and Edmunds.com. The company’s customer service is also highly regarded, providing transparent coverage and pricing with its No-Haggle, Low-Price Everyday Guarantee™ philosophy.
We like that CARCHEX has been recognized through numerous customer service awards over the years, including:
- 2017 ThoroughlyReviewed Top Pick
- BestReviewsHub.com Best Choice Award for 4 consecutive years
- TopConsumerReviews.com 5-star rating for 6 consecutive years
- 2017 Golden Bridge Award® “Silver Status” for 3 consecutive years for customer service
CARCHEX Extended Vehicle Protection Plans
The coverage options offered by CARCHEX are comprehensive and account for different ranges in price and protection.
- Titanium: Up to 10 years of bumper-to-bumper coverage for almost anything that can go wrong with your vehicle except for a short list of exclusions
- Platinum: Up to 10 years of long-term coverage for hundreds of specific components
- Gold: Up to 10 years of comprehensive coverage for vehicles over 60,000 miles, and includes flexible terms for coverage of most major vehicle systems
- Silver: Up to 7 years of essential coverage for many major systems on high-mileage vehicles
- Bronze: Up to 6 years of coverage against the most common and expensive repairs for drivers looking for basic protection
Unlike some dealership extended warranties, many CARCHEX contracts don’t charge a deductible, nor do they require you to visit a specific dealership. You are free to choose any repair shop you like, and are only required to pay a monthly payment that fits your budget.
Most Popular: CarShield
A great provider with a history of over one million vehicles protected and thousands of customer reviews.
Since 2005, CarShield has provided extended warranty protection on over one million vehicles, and can attribute its widespread success in large part to the quantity of its customer reviews:
- 4,934 Trustpilot reviews
- 2,460 Google reviews
- Featured on HGTV, CNN, ESPN, CNBC, TBS, and more
CarShield is also noteworthy for its flexible coverage, offering plans that are month-to-month contracts rather than fixed-year terms. Additionally, customers enjoy low or $0 deductibles, 24/7 roadside assistance, courtesy towing, claims paid directly to the auto repair facility, and free rental car or reimbursement depending on your plan..
Best Direct Provider: Endurance
Best Direct Provider
The best option for a direct provider, meaning you work with their team throughout every step of the process.
Unlike most extended warranty companies that work as brokers between customers and various plan providers, Endurance directly administers its warranty plans and is involved at every step of the claim process. The company’s one-stop-shop service speeds up claims and offers peace of mind knowing you have only one company to contact if you need assistance.
Best Quotes and Claims Process: autopom!
Best Quote And Claims Process
Another provider we recommend for their top-notch service, when getting a quote or submitting a claim.
This BBB accredited and A+ rated company is focused on one thing: automotive peace of mind. Founded in 2010, autopom! is committed to their namesake, fostering a reputation for speed and convenience in the quote and claims process. Trustpilot gives them a rating of Excellent, ConsumerReporting rates them 9/10, and they are listed as a Top 10 Pick from ThoroughlyReviewed.
The Bottom Line
Factory car warranties and extended car warranties are both intended to increase buyer confidence that the vehicle they purchased will be able to go the distance, and if any malfunction should occur, that it can get fixed without heavy financial loss. There are many providers, both through dealerships and third-party vendors, which can provide this type of security and relieve the mental and financial burden of expensive repairs.