Extended Vehicle Warranties

I'll start by saying I NEVER purchase extended warranties for anything and I always end up saying I'm so glad I didn't bother.  It just never seems to make sense for most items, typically they'll wear out or become obsolete and come way down in price anyway, so it's usually not worth it.

My vehicle is at the 33,500 mile marker and when I took it in for an oil change/rotation Friday, I got to thinking about whether or not I might want to get an extended warranty.  The bumper to bumper warranty expires at 36,000 miles or in about 3 months and then the PowerTrain warranty would remain, which would cover pretty much just the engine and transmission for about 2.5 more years.  

Normally I would think that the price of an extended warranty just prior to yours expiring would either be highly cost prohibitive, like $2000+, or more specifically I'd be concerned about the fine print of what isn't covered, what deductibles you might have to pay, strength of the company, etc.  I follow a few of the forums for my car online and almost 100% across the board, everyone said do not go with any of the 3rd party warranty companies. Two people had their warranty companies go out of business and many others were not recommended because of what they did not cover.

While I don't agree that ALL 3rd party companies are bad, in this case GM itself does have their own extended warranty that basically is a full continuation of the bumper to bumper warranty with very few exclusions and the prices through one dealer online are really pretty good.  So in this case, if you have a GM car, I would agree with them that you do not want to go with a 3rd party company, but your mileage may vary depending on your specific situation and make/model of vehicle.  Interestingly, the site lists the prices for all makes and models of vehicles, not just GM vehicles.

Dave Ramsey has a 'just say no' policy.  I know definitely NOT to purchase an extended purchase contract from a dealer, unless you come fully armed with a pricelist similar to the link below.  A prime example of this, is that my friend purchased a used vehicle 2 months ago from a dealership and I found out today that he paid 700 more for the same exact warranty that the site below provides.  Never a good decision.

It all comes down to cost/benefit, is the cost worth the peace of mind and knowing that you won't have major repair costs?   The warranty also includes roadside assistance, rental vehicles for longer repairs and is transferable in the event you sell your vehicle.  Since my vehicle actually originates in Australia, the parts sometimes take a while to arrive, so the rental coverage could come in handy, but it's only a max of around $220 per incident.  For me it would be a matter of considering the following two options:

3 years/45,000 additional miles for $1070
4 years/60,000 additional miles for $1685

What do you think?  Have you purchased a vehicle extended warranty and either used it for major repairs and were glad you had it or paid for it and never got the benefit of using it?  Would love to hear your experiences. 


GM Major Guard Extended Warranty (Highly Discounted) 

Posted in: vehicle extended warranties