There are two types of people who live on this planet; those who drive cars and those who don’t. If you belong to the former category, you must be aware of the perks associated with a manufacturer’s warranty. Knowing that the repair and replacement costs would be covered by the warranty for a specific period of time is quite stress-relieving.
However, what would you do after the manufacturer’s warranty on your vehicle expires? The common approach would be to get aftermarket or extended auto warranty.
Apart from identifying credible auto warranty providers and ditching the worst extended auto warranty companies, you need to ask yourself if an aftermarket warranty is really worth it for you? In this article, we will help you in answering the same question.
Aftermarket Auto Warranty: What You Need to Know
As stated above, an aftermarket warranty is what you should be on the lookout for after the expiration of the manufacturer’s warranty. It is also referred to as an extended auto warranty. Since such a coverage plan can be purchased only after you buy a car, it’s commonly called an aftermarket auto warranty.
It goes without saying that an aftermarket auto warranty covers numerous repairs and replacement costs.
Aftermarket Auto Warranty: Cost & Coverage
Even though it is used to fill the void created in the wake of the manufacturer’s warranty’s expiration, it’s essential to understand that an aftermarket or extended warranty doesn’t cover all the parts that the factory warranty does. Its coverage quota is limited and therefore, you have to tread carefully.
One of the main downsides of an aftermarket warranty is that despite having it, one must pay out of their own pocket when it comes to routine maintenance i.e. changing tires, installing new brakes, changing oil, etc. And this exclusion isn’t exclusive to the worst extended auto warranty companies.
Moreover, different aftermarket warranty providers offer different coverage plans. These plans differ in their price, parts covered, coverage period, etc. It’s worth noting that when purchasing a used BMW, you can conveniently find genuine BMW parts online to ensure reliable replacements and repairs throughout the ownership.
When it comes to the cost, you can expect the base price of a standard aftermarket warranty contract to be in the range of $1000-$3000, if not more. Apart from the coverage level, the make and model of your car also play a vital role in determining the cost.
However, most of the time, these contracts are negotiable. Moreover, you have multiple options to explore before finalizing the warranty provider you are interested in doing business with.
Another common feature of extended auto warranties is a deductible. For those of you unaware, a deductible is a consistent fee that you have to pay for a repair or replacement before the warranty company takes over to cover the rest of the payment. There are multiple ways for paying a deductible and before purchasing any warranty, you must have a clear understanding of how the deductible linked to that particular warranty must be paid.
Aftermarket Auto Warranty: What’s in it for You?
You can take care of your car all you want but the fact is that it wouldn’t stop it from breaking down in the middle of the road if it has to. This is why leading automakers offer a manufacturer’s warranty with every new vehicle of theirs.
But after the expiration of the said warranty, you are either left with a choice to get an extended warranty or be ready to pay for unexpected repairs and replacements out of your own pocket.
However, if you decide to get an extended auto warranty, you can continue to drive your vehicle without having to worry about emptying your pockets in case of a mechanical failure or accident.
Moreover, an aftermarket coverage plan can come in handy if you are considering buying a used car. Unlike new cars, many used vehicles don’t come with a manufacturer’s warranty covering them.
Additionally, while aftermarket warranties aren’t the most affordable items on this planet, many third-party providers offer budgeting plans that make it easier to purchase coverage.
Also, unlike the worst extended auto warranty companies, credible providers offer sample contracts to convince you about the legitimacy of the services they provide. In short, buying an extended auto warranty from the right company can not only alleviate unneeded stress but also ensure that your investment turns out profitable.
Aftermarket Auto Warranty: Worth it or Not?
After walking through the basics of an aftermarket warranty, it’s time to answer whether an extended auto warranty is worth your money or not.
So, without beating about the bush, let’s just say that while such coverage helps you find peace of mind, it isn’t for everyone. For some people, it might simply be a waste of money.
For drivers who purchase an aftermarket warranty but never or rarely have to use it, paying a handsome price for a coverage plan isn’t a smart investment. Moreover, during the initial years of driving a car (when it’s covered by a manufacturer’s warranty), you will get a fair idea about the extent of repair and replacements your car requires on a regular basis.
So, if you are confident that you wouldn’t have to use the warranty often, it’s recommended that you set aside money for a fund dedicated to covering emergency repair costs. If the amount in the fund just keeps on increasing without you having to take some out for mechanical purposes, you might just save enough to buy a new car with a quality factory warranty covering it.
To sum things up, an aftermarket warranty contract is only worth buying if you have a reason to believe that your car will encounter mechanical failures on a regular basis.