Do Extended Warranties Give You Peace On Earth?

By Karl W. Heinzel

People purchase extended warranties are lots of consumer products including automobiles. Chances are you're never got to get your money out of your investment. As a matter of fact, extended warranty is arn't really even extended warranties at all. A more accurate name for them is a service contract. these contracts are usually sold as an add-on sale at the time of purchase. Through these service contracts, you end up paying a separate warranty company, an upfront fee to cover repairs that may show up in the future.

Car Dealers try to scare you into purchasing a service contract for your peace of mind after your factory warranty expires. This is because service contract sales are a huge profit maker for a car dealer. Typically, 50% or more of the selling price goes to the dealer as the seller. However, rarely do these "Extended Warranties" provide you with the protection that you are led to believe they have and would expect.

Most have exceptions or exclusions such as the following:

Are you lacking, vehicle maintenance records? If you fail to produce records proving that the regular maintenance schedule was followed your in trouble. Not just maintaining the vehicle, but proving that the vehicle was maintained. Without proof you're not covered.

Consider wear and tear parts. Things like brake pads, shoes, hoses, even shock absorbers are considered items that normally wear out and are usually not covered. Anything they can be considered normal wear and tear is generally not part of the contract.

Damage caused by a noncovered part. Your contract may cover the entire powertrain but if a non-covered parts such as a hose should break and this causes major engine damage, the contract will not cover the engine damage, because the hose was not covered part.

"Exploratory surgery" . In most cases, there is a fair model labor involved in discovering what the problem is and this will only be covered if the problem turns out to be a covered part. Otherwise you'll end up stuck with the bill. In the garage may not even start on the work until you paid for the labor front.

Limited repair options. You may have a hard time getting repairs on your vehicle, because the service contract limits where you can have the repairs done. The agreements sometimes severely limit who can work on your car by restricting the repairs to a certain number of places. On top of that, some service contract providers have a bad reputation in the service center won't even honor the contract. They'll ask you to pay for the repairs, and you have to try and get reimbursed for yourself.

if you consider all these hoops that you have to jump through, it's hard to imagine it having any peace of mind by purchasing an extended warranty. Of course, odds are you're never going to use the contracts anyway, on the person who sold it is going to be making the big money. Generally, your lot better off taking the same money and saving it for any emergencies.

About the Author:

Karl & his partners write about important legal issues such as Warranties & Auto Issues at http://lemonlawyer.wordpress.com They specialize in California Lemon Law issues & are lemon law attorneys for southern California