Extended car warranties and other forms of mechanical coverage have very unfortunately built up a less than desirable reputation. This has muddied the waters and shadowed the financial benefits of extended auto protection.
What are the Financial Benefits of Extended Auto Protection?
Aside from giving you peace of mind that your vehicle is covered in the event of a mechanical breakdown, you could also benefit financially. This might seem a little counterintuitive at first, however, having coverage in place could offer a sense of financial freedom. Living on a paycheck-to-paycheck basis makes it more difficult to keep money aside for large bills.
Particularly bills that tend to happen sporadically. An extended car warranty can help to alleviate that stress. If you do not have the possibility to keep upwards of $1000 set aside for unforeseen auto repairs, then yes, an extended car warranty is worth it. Here are our top financial benefits of extended auto protection you have to look forward to:
Vehicle repair bills can sometimes be on the higher end. Certain repairs cost up into the thousands of dollars. Transmission, exhaust, and engine repairs typically incur hefty repairs bills. These parts are also critical components for the running of your vehicle. On top of all of that, a mechanical failure generally happens spontaneously. This can make it difficult to be prepared in the event of a mechanical breakdown.
When you have an extended car warranty or a vehicle service contract plan, you know what you are spending each month and that it will all be covered when you need to get sudden vehicle repairs. It gives you the opportunity to budget for every month with consistent and affordable rates for the duration of the coverage plan.
Increase Resale Value
Another financial benefit of having extended coverage is that you could possibly maintain or increase the resale value of your vehicle. Cars tend to decrease in value over the years which make them difficult to resell. However, there are a few things that you can do to keep the resale value of your car higher than other vehicles in the same class.
One of those ways is to ensure that you have an extended car warranty or a vehicle service contract in place. These plans tend to show that the car has been well taken care of and likely to have had all the scheduled maintenance needed. The coverage is often transferable which gives the car more value as it comes with protection against a mechanical breakdown from day 1.
Additional Services Covered
The repair bills are just one part of the whole ordeal. Towing services, car rentals, and even accommodation are considerations for when you experience a breakdown. These costs would be extra to the vehicle repairs required.
When you have coverage for mechanical breakdowns, many of these extra services are covered under the plan. Other perks of having extended auto protection include flat tire services and trip interruption.
What does an Extended Car Warranty Cover?
An extended car warranty is offered directly by the vehicle manufacturer. The purpose is to extend the warranty that came with the vehicle at the original purchase. Each manufacturer stipulates which parts they cover but they generally all cover the most vital components which include the transfer case, engine, and axles.
A vehicle service contract is offered by a third party provider. They are available on a few different tiers that have different terms to best suit your driving needs. These plans can be taken out at any time and will commence once your factory warranty has terminated. The coverage you can expect will include the critical components listed above. The more comprehensive plans will include electrical systems and exhaust systems.
When is a good time to take out extended auto protection?
This depends on which extended auto protection coverage you opt for. If you are going to go with a manufacturer extended warranty then you will need to see what the manufacturer of your vehicle has available. Certain vehicle manufacturers require you to take out an extended car warranty at the original purchase of your vehicle. Other manufacturers offer extended warranties that can be taken out towards the end of the factory warranty. You may also have the option to get protection for certified pre-owned vehicles if you have bought a used vehicle.
A vehicle service contract can be taken out at any time for the majority of vehicles. These are great options for people with older vehicles or people who have recently bought a used vehicle. And the best time to get protection for your vehicle is now.
Chaiz is the first online marketplace that is an all-in-one service where you can research and compare extended auto protection plans. Use the Chaiz search tool to find the best coverage plans for your vehicle.