Pros and Cons of Extended Auto Warranty

Back in the day, our television sets would last us over two decades, dishwasher even three decades. However, now times have changed. The world we live in today is what we could call a disposable world. Despite that, when products stop working, we are hugely disappointed. At times, we might choose not to invest in that brand again or even boycott the shop from where we got the item. You might have noted that when you shop from a retailer (not manufacturer), they try to keep themselves guarded against this customer discontentment by giving away extended warranties on every product.

Now, it certainly doesn’t make sense to buy an extended warranty on something like an oven or a toaster. But do you need one for your car? Well, let’s find out.

Pros and Cons of extended warranty

Let us take a quick look at the merits and demerits of extended auto warranties.


  • Flexibility

Since the extended auto warranties are an aftermarket warranty, they are customizable, and you can personalize them according to the situation. If you find a noticeable difference in the original powertrain warranty and the all-inclusive warranty, you could consider seeking an extended warranty that adequately provides for anything that’s not a part of the powertrain warranty. Anaida, an associate with TFTH, says that she got a customized extended auto warranty to avoid paying doubly for anything. Well, yes, these days warranty providers do have this option for their takers.

Let’s understand this further with one more situation.

So, you have a vehicle that comes with an original warranty that might wear out after five years. As the potential car owner, you know that you intend to keep this vehicle for another two years. You can get a structured warranty for the two years in place of getting a one year extended auto warranty, and then going through the same process again in the following year. Hence, this flexibility of personalizing the auto warranties is a great plus.

  • Manufacturer Backed

When you receive an extended warranty as an offer, you would have certainly noticed that this offer-based warranty from a dealer is far pricier than what you could get with a third party. However, this premium price could be worth the money. James, an employee, offering math homework help with TAE, says that though the dealer warranty is pricier than the third-party, he would still opt for it because it is manufacturer backed. That’s correct. The dealer warranty will insure even the Original Equipment Manufacturer (OEM) components that would be used in the repairs.

Moreover, these warranties are better at almost every manufacturer affiliated US-based dealership. Thus, the owner can avail of the warranty benefits even if they intend to relocate.

  • Your repairs are included

You know that the prime reason for getting an extended auto warranty is that all the costly repairs can be covered under warranty. The auto vehicles that you find in the market today are equipped with all the complicated electronics, engines, cameras, computers, giant, panoramic sunroofs, and several other things. Though they are engineered to last, they might break or require a replacement at times. With an extended warranty, this repair can be made stress-free.

  • Cons
  • Your approach is negative

When you opt for an extended auto warranty, you are assuming that your car would need a significant repair while you own it. With this premium, you are only trying to minimize the amount that you’ll have to pay towards the repair should something happen to the car. Furthermore, if your car company is issuing you this extended warranty, does it not mean that they believe that the premium you pay to them would be more than what they would get for any plausible repairs in the future?

Given the fact that these companies that offer you the premium are still in business despite providing extended warranties, that means that their assessment that premium would bring in more money than the expenditure they will have to bear on the repair is far more ideal than your assessment.

  • Certain repairs not included

Now, whenever a customer buys an extended auto warranty, he believes that when a future repair crops up, the warrantor will pay for it. However, that might not be the case always. Thus, you should check, which all repairs and replacements are included, and which aren’t. Further, get it personalized, if needed. Hannah, an accounts head with TrumpLearning, says that she spent so much money on extended auto warranty only to find out two years later that a lot of repairs were not included. It is a common scenario with a lot of agents, so beware.

  • You don’t use it

In many cases, you might never get to benefit from the extended warranty because your car stays in perfect condition. So, that only means that you go on paying the premium, without ever needing the warranty. Justin, an executive who offers science assignment help with FineGrades, says that he paid for extended auto warranty for five years, but never had to use it because his car stayed alright.