What is Bumper to Bumper Extended Auto Warranty?
An extended auto warranty is a vehicle service contract. This service contract guarantees to fix your vehicle if something breaks on it.
15:18 18 October 2021
An extended auto warranty is a vehicle service contract. This service contract guarantees to fix your vehicle if something breaks on it. Extended auto warranty services generally go longer than the manufacturer’s warranty and cover the vehicle’s damage repairs for the amount of time and mileage you specify in the contract.
There are a lot of car dealerships out there that will try to scam you for your money by making you sign-extended warranties that will not cover even the minor damages, let alone the significant cases. So, to save your hard-earned, it is wise to understand how auto warranty service works fully.
Three types of bumper to bumper extended auto warranty:
- Dealer-backed coverage: This type of auto protection service means that in case of warranty claims, the vehicle has to be taken to the dealer from which it was purchased, and no other repair facility will provide you services.
- Aftermarket backed coverage: You can take your car to the aftermarket companies to get your vehicle repaired in this type of coverage. Automotive companies manufacture, distribute and install vehicle parts. Robert Bosch, Denso, Magna international is the top automotive aftermarket company in the USA.
- Manufacturer’s backed coverage: The vehicle's manufacturer is responsible for servicing the vehicle in manufacturing backed coverage.
Which one to choose?
Some of the most trusted online auto vehicles trade markets like Edmunds, carfax, and auto trader all recommend that the manufacturer’s vehicle service contract is the best option among the three.
- Original manufacturer parts: In case of replacing any vehicle part, authentic manufacturer parts will be used instead of some cheap copies.
- Paid labor: This warranty pays the struggle to do the repairs, and not a single penny is spent from your pocket.
What is covered in bumper to bumper extended auto warranty?
Bumper-to-bumper extended auto warranty means that almost all the damages, whether engine or vehicle's body-related, are covered in the vehicle service warranty. But extended auto warranty contracts can be drafted in two ways, and it is recommended to understand these contracts to avoid any scams.
- Stated: In this type of bumper to bumper extended auto warranty, the listed items in the contract are covered by the warranty.
- Exclusionary: In this type of auto protection service, the listed items on the contract are not covered by the warranty. The repairs other than those will be covered by your warranty providers.
What are deductibles?
Deductibles are the amount of money the warranty holder needs to pay before they can claim the warranty.
- Per visit deductibles: If your warranty has a per visit deductible plan, then no matter how many things need to be repaired, you will have to pay a one-time fee for a visit. The average per visit deductibles cost is around 100 dollars.
- Per repair/occurrence deductibles: This type of deductibles can cost you around $200 to 300 dollars per repair.
Pros and cons of buying bumper to bumper extended auto warranty:
- Extended level of coverage: Basic vehicle warranties cover the repair expenses for no more than three years, whereas extended auto warranty protection services can cover your vehicle’s repair expenses for up to 9 years and 100 to 120 thousand miles.
- Don’t have to spend from your pocket: If you buy a bumper-to-bumper extended warranty, then you don't have to disturb your monthly budget every time your car breaks down because all the expenses are covered by your warranty, especially after three years, when your vehicle will start to age and will need minor repairs with time.
- Expensive: The only con of buying an extended auto warranty is the cost. Extended auto warranties are not cheap to buy, and if you are on a limited buying budget, then extended auto warranties can really do a number on your pocket.
Is buying bumper to bumper extended warranty worth it?
Yes, vehicle service contracts are worth buying if you have the budget at the time of vehicle purchase. Although they are not cheap, they will prove worth it if you think about the long run.
Average auto warranty protection services cost around 1500 dollars, which seems a little bit too expensive. Still, suppose you consider that your new vehicle costs approximately 35 thousand dollars. In that case, this $1500 amount is relatively small compared to that, and do not forget that this warranty will last for four different years when your three-year dealership warranty is expired.
Is the extended auto warranty transferable or reimbursable?
Yes, extended auto warranties are transferable and can also be canceled or reimbursed.
If you want to sell your vehicle to a third party and your extended auto warranty still has some time left, then what you can do is transfer the warranty to the new owner for a small fee of around $30 to 40 dollars.
If you wish to sell your car to a dealership, you can get your auto warranty reimbursed, and the cash can either be used to buy a new car from that dealership or can be paid in total upfront.
Accidents and minor problems are common in vehicles. In conclusion, most people do not have a budget to pay for these repairs whenever the issues occur, so it is wise to be prepared and buy an extended warranty at the time of purchase. In this case, you will be able to relax for an extra 4 to 6 years (depending on your warranty terms) and stop worrying about these extra expenses.