Being a first-time car buyer can be exciting. But it can also be overwhelming. There are so many choices to make and a lot of money is at stake!
If you’re a first-time car buyer, this guide will help you with at least one area of car shopping – the extended vehicle warranty. What is that you ask? Keep reading and you’ll get an understanding of the basics of it and why you might want one.
Most people have at least heard the term extended vehicle warranty but many don’t understand exactly what it is. The first thing to know is that most extended warranties are most likely actually a vehicle protection plan. A true extended vehicle warranty can only be sold by an authorized dealer and is backed by the manufacturer of the vehicle.
Anything else is probably a vehicle protection plan and is sold by an independent, third-party provider. To add to the confusion, many dealerships sell vehicle protection plans too, and not just the extended warranty that is backed by the manufacturer. While there are differences, in both cases, the plan is essentially a contract that covers the cost of certain repairs and problems after the original manufacturer’s warranty expires.
Shopping Tips for a First-Time Car Buyer:
- Find a trustworthy company: Extended warranties aren’t cheap, so you want to make sure you are going to get what you pay for. An easy way to discover if a company is trustworthy is to find out who backs the plan. This applies to plans being sold by both independent providers and dealers because many dealers sell plans that aren’t from the manufacturer. Make sure to buy a plan offered from the manufacturer or one that is backed by a well-rated insurance company. Another sign of a reputable company is their willingness to provide a free quote and show you a copy of a contract so you will know what is and isn’t covered.
- Clarify what is covered: An extended vehicle warranty or vehicle protection plan normally falls into two key types of contracts – named exclusion and named components. These plans have a lot of differences, so read the quotes carefully. Here are the basics on the two types of contracts:
- Named Exclusion Contract
- More comprehensive
- Every component is included unless specifically excluded
- Common exclusions are oil changes, tires & brake pads
- Named Component Contract
- Only named parts are covered
- Can be as basic as drive train coverage
- Good option for older & simpler vehicles
- Ask about all the features and benefits: Be sure to consider the features and benefits that are included, because this can be a major differentiating factor amongst plans. For example, with a plan bought from a dealer, you usually have to take your vehicle back to that specific dealer for any repairs. Many third-party provider plans allow you to take your vehicle to any licensed repair facility. Furthermore, third-party plans also may include other great extra benefits such as:
- Rental Vehicle Assistance
- 24-hour Roadside Assistance
- Tire Protection
- Trip Interruption Coverage
- Transferrable Coverage
- Consider how claims are paid: You want a company that will pay claim directly to the auto repair shop, so that you don’t to have to pay out of pocket and then wait months to be reimbursed. If the company will not pay claims directly, I suggest you look at other options.
- Look for a money back guarantee: Any company worth doing business with will offer you a 100% refund if you are not satisfied with your purchase. Giving consumers 30 days to cancel is common practice but some may have shorter or longer times. If there is not a money back guarantee, it might be time to look for a new company.
So if you’re a first-time car buyer, I hope this first-car buyer’s guide to an extended vehicle warranty has been helpful. If you would like to learn more about your options for an extended vehicle warranty or vehicle protection plan, we recommend getting at least a few quotes.
The Benefits of autopom!
I recommend you start with autopom! Contact autopom! today. We’ll outline the plan options available to you and highlight some of their amazing benefits like roadside assistance, rental vehicle assistance, and repair shop choice. Some plans even include tire protection and interest-free payment options. When you call us, you’ll be put in touch with one of our industry-leading agents who can provide you with a free quote and answer any questions you have. It’s time you find automotive peace of mind with autopom!.
