IPB
Site Navigation
·Forums
·Today's Active Topics
·Today's Top 10 Posters
·Contact Staff
Lexus Warranty Forum
Lexus Warranty Forum
Lexus Forums
· Lexus ES300 / ES330
· Lexus LS400 / LS430
· Lexus SC300 / SC400 / SC430
· Lexus GS300 / GS400 / GS430
· Lexus RX300 / RX330 / RX400h
· Lexus IS250 / IS300 / IS350
· Lexus LX450 / 470
· Lexus GX470

Extended Warranty Myths

You can only buy an extended warranty from the dealer who sold you the car.

Car dealers are middlemen who make their highest commissions on the financing and extended warranties they sell. They are going to want you to purchase your warranty from them when you buy your car, so it can be included with your financing. Finance charges can increase the overall warranty cost by hundreds, or even thousands of dollars. You should try to buy your warranty direct from the source, if you can.

If I buy the extended warranty before the manufacturer's warranty expires, I will have double coverage on my vehicle.

Extended warranties are NOT double coverage; they simply extend the term of the warranty the manufacturer provided on the vehicle. Once the manufacturer's warranty expires, an extended warranty takes over to protect you from unexpected, costly repairs. It's important to buy it early, especially before your original factory warranty expires. This is when it will be the least expensive. Similar to purchasing life insurance, the longer you wait, the more it will cost.

You must purchase an extended warranty in order to qualify for financing.

It does not make any sense that a person would be required to increase the amount they are borrowing by adding an extended warranty, in order to obtain financing. Financing is approved or denied based upon your credit, and nothing else. By including the extended warranty in your car purchase, you will be stuck paying additional interest. Many warranty providers can offer you interest free financing.

I don't need an extended warranty, I'm covered by the manufacturer.

There are many reasons to purchase an extended warranty. Your vehicle is one of your biggest investments. An extended warranty will ensure it is always in the best mechanical condition. With the complexity of today's vehicles, one major repair often costs more than the extended warranty. Hourly labor rates can top $90 per hour in some markets.
Many warranties are transferable and will increase the resale value to potential buyers. Who wouldn't want to own a vehicle that comes protected from repair bills?

A "mechanical breakdown" warranty offers the same coverage as a "wear and tear" warranty.

If "wear and tear" is not covered in the contract, then you are probably being offered a "mechanical breakdown" warranty. There are many components in your vehicle such as piston rings and CV joints, that usually wear out instead of breaking, in which case, they would not be covered under a "mechanical breakdown" warranty. A "mechanical breakdown" warranty is less expensive and less coverage. The only way to tell what kind of warranty you are buying is to read the definitions section of the contract.

As long as I have an extended warranty, I don't need to worry about my car.

Cars still need proper maintenance, as outlined in your car's owners manual. Be sure to keep accurate maintenance records and receipts. To neglect this responsibility to your car will not only jeopardize your claims getting paid, but will also put your investment at risk. All extended warranties require that you properly maintain your vehicle and perform the manufacturer's recommended maintenance.

My dealer does not accept third party warranties for repairs.

The marketing and sales of extended warranties has moved beyond the traditional car dealer channels. Dealers not only offer the manufacturer's extended warranty, but are now offering third party warranties as well. Most third party warranty companies pay the repair facility immediately over the telephone by credit card, so there should be no objections about accepting the warranty. In fact, a warranty from a third party will require the dealer do less paperwork and not wait for reimbursement.

My service contract is automatically in effect as soon as I pay for it.

The company that underwrites the service contract is solely responsible for ensuring that the terms and conditions are met. The seller of the contract bears no such responsibility, thus consumers should call the contract underwriter -- not the dealer -- within 30 days to confirm that the application has been submitted and approved. Service contract companies usually give customers a plastic ID card or similar identification, so if you don't receive confirmation of your contract, you may not be covered. There have been instances where consumers have had no idea they were without coverage until several years later, at which point it was impossible to trace their applications -- or their costly premiums.

I already have powertrain coverage that lasts even longer than my original bumper-to-bumper coverage, so I do not need to buy an extended warranty.

Not so, you will be without coverage for the parts and systems that most frequently fail such as high tech sensors, computers, air conditioning and many more.

The wrap warranty is a new type of extended service plan, offering additional coverage for new vehicles whose powertrain warranty runs longer than the original bumper-to-bumper plan from the manufacturer. Certified used and off-lease vehicles with an extended powertrain warranty, may be eligible for this type of warranty as well. The manufacturer's powertrain warranty only covers about ¼ of the vehicle's components. Wrap warranties pick up the remaining ¾ of the vehicle's components for the same term, including such things as air conditioning, electronics, electrical, brakes, ABS and much more.

It is important to understand that even though the manufacturers are extending the original warranty, the additional coverage being offered is very limited. After the initial bumper-to-bumper warranty, longer powertrain warranties only cover components such as the engine and transmission, and may not be transferable to other owners upon sale. Wrap programs compliment the longer powertrain warranties being offered, preventing the consumer from having to buy coverage they already have from the manufacturer.


©2005 Warranty Direct

Warranty Links
Warranty Centre Home
Get a Free Warranty Quote Now
Warranty Articles

Coverage
Piece of Mind
When to buy
How do Claims Work?
Why Warranty Direct?
Customer Testimonials
Contact Warranty Direct
Lexus Warranty Quotation

Lexus Warranty
Lexus Warranties
Cost Of Repairs
Extended Waranty Myths
Extended Warranty 101
Warranty Glossary
Extended Warranty Quotation