Complete Car Warranty Guide (2022)

Car warranties of all kinds offer valuable protection for vehicle owners. But even with the most reputable warranty providers, there are still things to watch out for. Most warranty plans include important clauses and exceptions in the fine print.

Waiting Period

It’s common for a car warranty to come with a waiting period, especially if it’s an extended warranty. This period, which is typically around 30 days and comes with a mileage minimum, exists to prevent people from using warranty coverage on preexisting issues. During this period, you won’t be able to use your coverage.

Coverage Period

Vehicle service contracts come with terms that define how long coverage is available. This is typically defined by both mileage and age, such as 3 years/36,000 miles. Coverage usually ends with whichever comes first.

Exclusions and Restrictions

Even so-called bumper-to-bumper warranties come with restrictions and exclusions. Here are some of the most common:

• Wear-and-tear items: Most warranties don’t cover items that need replacing regularly, such as brake pads and light bulbs.
• Repairs resulting from misuse: Car warranties are meant to protect your vehicle under regular use. If you use your vehicle in a way that’s not recommended by its manufacturer — such as towing something outside of its capacity — your provider can deny your warranty claim.
• Damage from a car accident: Repairs needed because of collisions are the responsibility of you or your car insurance company, depending on your policy. That means you can’t use your warranty to repair items damaged in an accident, even if you don’t have adequate insurance coverage. The same goes for things like vandalism and flooding.
• Preexisting damage: When you sign your warranty contract, you agree that you won’t use coverage to repair existing damage. Even if you make it out of the waiting period, you’re technically not allowed to have preexisting problems repaired under your warranty coverage.

Coverage Eligibility

Not all vehicles are eligible for warranty coverage. Many providers place age and mileage limits on their coverage plans, and cars that fall outside of those limits are ineligible. That means it may be hard to find a used car warranty on an older, higher-mileage vehicle.

In addition, some providers won’t cover high-end luxury or exotic vehicles due to the high costs of repairs. However, some warranty companies offer specialty plans for older or more expensive vehicles.

Cancellation

It’s not unusual for people to decide that they don’t want their car warranties after all. Most providers allow you to cancel coverage and get a full or prorated refund, depending on how long you’ve had it. Providers have different cancellation policies, so check your warranty contract to know how to proceed.

Transferability

Many VSCs are transferable — they follow the car and not the driver. So if you want to sell your car, the new owner can benefit from the protection plan you bought.

Having a warranty can increase the value of your used car when you sell it. While it’s common for car warranties to be transferable, many providers charge a small fee to do so. Your warranty contract will outline the requirements to transfer your coverage.

Scams

Unfortunately, the warranty industry has been plagued by phone and email scams in recent years. The Federal Communications Commission (FCC) has warned consumers that scammers are calling people and claiming to represent warranty companies. These callers ask for personal information that can be used to steal a person’s identity or commit other kinds of fraud.

These scams have affected consumers’ views on even the most reputable extended car warranty companies. To protect yourself, don’t hand over information to someone who calls you. If you’re interested in purchasing coverage, find the phone number or website of the provider you want to reach. Even if the caller who reaches you is perfectly legitimate, you don’t have anything to lose by hanging up and calling the phone number you found.