Some may argue that this is a question without a factual answer, but I hope one exist.
My wife and I are purchasing a car and are considering a factory extended warranty. I understand how extended warranties work on the surface, and understand that self-insurance may be cheaper (obviously the manufacturer intends to pay out on average less than the warranty cost). However, I am willing to pay for peace of mind.
My question relates to maintenance and its impact on warranty claims. My experience when I take a car into a dealership to get something fixed is that they come up with 3-4 bogus maintenance issues every time. Stuff like:
Throttle body needs cleaned.
Injectors need treated.
Tires need aligned.
Some sensor has a rust spot on it and must be replaced.
A hose or belt always “look bad” and needs replaced, no matter how new it is.
Other stupid BS to pay for the fishing boat.
I reject most of these, as I know they are BS (Sometime they find something that actually needs done, but rarely). I am concerned that if I have an extended warranty, these items will be used to reject warranty claims. Also, I change my own oil and filters (at half the recommended interval) and I worry this will be used against me if a claim is filed.
Yes Mr. Culture, I know your engine blew up, but that is your fault for not having that front end alignment when we told you it was needed. Plus, can you prove that oil you have receipts for was actually placed in your engine and not some others?
In my opinion, extended warranties are a complete crock, since they typically only cover manufacturer defects on original parts. Once you’ve driven a car for 3 or 4 years, any “manufacturer defects” will have likely manifested themselves, and anything that goes wrong with the car after that won’t be covered.
Some warranty companies are pretty stingy in their coverage, e.g. they may cover the failed part but not the gaskets and fluids that also have to be replaced as part of the job. And some, like Medicare, only pay what they calculate for the job. This results in either the shop doing it for less than they normally would charge (and deciding not to bother in the future) or the customer paying the difference between the shop’s charge and the warranty company’s payment. They also can be reluctant to approve some jobs, seemingly always looking for a way to get out of having to pay.
Other warranty companies are quite good in their coverage for the customer and how they pay the repair shop, which results in a pleasant experience for all.
In either case, as far as I know the only requirements are to do the factory-specified maintenance. If you’re dealing with a dealership, be aware that dealerships generally make their own maintenance schedules, which usually have more items than the factory list.
Read the warranty you’re considering buying. See what the maintenance requirements are. See also if they exclude gaskets and fluids–in my experience, that’s a sign that they’ll be a royal pain to deal with in event of a failure.
By the way, that factory-specified maintenance can be done at the repair shop of your choice, or by you. Keep repair shop receipts, and if you do it yourself, keep parts receipts and keep a log of the maintenance you perform. As far as I’m aware, the standard is reasonable evidence, not absolute irrefutable proof.