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Which Type of Warranty Do you Need?
Home » Automobiles » Extended Warranties & Performance Service Contracts » Which Type of Warranty Do you Need?There are two types of extended warranties: those offered by the car's manufacturer and those offered by independent companies, which are also referred to as aftermarket warranties.
The contracts offered by an auto manufacturer are probably the safest. They cover a wide range of repairs and services which can be done at any authorized dealership and tend to be approved with no problems. You don't pay anything for approved repairs unless your contract includes a deductible.
You can get an extended warranty from an independent company for half the price, but the quality of these types of contracts varies widely. Be sure to shop very carefully before you purchase this type of warranty. In addition, with many aftermarket warranties, you may have to pay for the repair upfront and wait to reimbursed by the company. This can sometimes take weeks so be sure you research the reimbursement policy before getting an aftermarket warranty.
Some dealers may also try to sell you a dealer warranty rather than a manufacturer's warranty. Usually with these types of warranties all the repairs and services must be done at a single dealership; namely, the one selling you the warranty. So if you have car problems while traveling, this type of warranty would not be helpful. In general, it's best to avoid dealer warranties.
Sources:
www.bankrate.com
www.cnet.com
www.pcworld.com
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