Auto Warranty, Needing your input (Air Jer)??

[S.D. Ice Angular]

Hi Guys!!

I am looking at buying a 2007 Suburban with over 130,000 Miles on.

The dealer is pushing me to purchase a warranty package through “ASC Warranty” be claims they are really great to work with.

I checked with my local independent repair / service shops neither one had heard of them and HATES working with any of that type of organization like these.

Anyone have any experience or thoughts on so called “Extended Warranty” companies??

[Whoaru99]

Yeah...the odds are that you'll never get the money out that you put in. It's the way it works. Oh, sure, it's a payoff for some people but the majority pay in more than they collect.

The dealer is pushing you because he gets a big chunk out of selling it.

Before you sign up be sure to get a copy of the FULL text of the policy and READ what is covered and what isn't covered and or what is considered normal maintenance or normal wear and tear, and what are the steps to file a claim and how any claim disputes are handled. I believe it is the law that you are entitled to a copy of the full policy, not just a little tri-fold sales slicker, BEFORE you buy.

I GUARANTEE if it's not written in the official policy, the company will not pay it.

I'm not saying it's a ripoff, I don't know, and some people like the peace of mind of some sort of coverage.

The main and VERY important point is to FULLY UNDERSTAND what you're buying, terms and conditions, etc. to potentially avoid lots of frustration, heartache, and anger down the road if/when you hear "Sorry, that's not covered.".

I used to somewhat deal with this sort of thing and that's the number one issue...people don't understand what they're getting/buying then are really pizzed off when they have a problem that's not covered.

[LwnmwnMan2]

S.D.

My parents were just going through this about 2 weeks ago with an '08 Chrysler T&C they have.

The van has about 70k miles and has given them fits over the years. Chrysler has paid for most of the repairs, and they even received a check from Chrysler about 2 months ago for $2,000 for their hassles. My family has been a Chrysler family since the early 80's and once the Chrysler rep looked up the purchase history over the years and all of the vehicles, they took care of my parents above and beyond warranty coverage.

They received a mailing about getting an extended warranty for another 48,000 miles. They called the company and were on the phone when I stopped by a couple of weeks ago. The coverage was going to be $3,800.

My opinion was to take the $3,800 and put it in the bank. If something major happens, you have the money to repair it. If something major doesn't happen, you have the money for a down payment on the next vehicle.

My parents were kicking around the idea of trading the van in and I said take the $3,800 and use it for extra on the new vehicle, and buy a service contract for the new vehicle. Chrysler allows you to buy a lifetime service contract. Unlimited miles. We have one on our '08 Chrysler T&C, and I have them on my '11 Dodge Ram 2500, as well as my new '12 Ram 2500.

The '11 Ram only goes to 100k miles though, as they won't let you run an unlimited mileage service contract on a diesel. It's another reason I went back to gas in my '12 Ram 2500, as well as I'm getting dang close to the same mileage with the new Hemi as the 6.7 diesel and am paying .80 / gallon less (+/-).

But I digress....

IMO, keep the money. If you were going to build it into the payment, take the same amount of money and put it into a savings account each month instead ($50, or whatever it was).

If you were going to buy a new vehicle and could put a lifetime service contract on it, that's the route I go.

[DANR]

Lots of people like to say that "extended warranties" are a waste of money. Someone who has had one bail him out of a surprise repair would disagree. It is insurance and like any insurance a waste of money if you don't need it and a godsend if you do. As whoaru says you need to read the coverage very carefully before you buy. It is amazing how many things can be left off what looks like a comprehensive policy.

[Whoaru99]

disregard.

[delcecchi]

Lots of people like to say that "extended warranties" are a waste of money. Someone who has had one bail him out of a surprise repair would disagree. It is insurance and like any insurance a waste of money if you don't need it and a godsend if you do. As whoaru says you need to read the coverage very carefully before you buy. It is amazing how many things can be left off what looks like a comprehensive policy.

What is the most expensive repair you might need? An engine for 6k? A tranny for 2k or maybe 3k? And what does the warranty cost, and for how many years/miles? Just thinking about how to approach the problem.

[Whoaru99]

I don't think you can approach it from just the cost of worst case though. It's the odds of break even or payback, for lack of better terms, on a covered repair that determine it.

[Eric Wettschreck]

First off, an 07 with over 130k miles seems high to me. My 96 Lumina has 180K and it's 10 years older.

How good of a wrench are you? Not trying to sound belittling but can you fix your own stuff or do you have to go to a shop for everything? This matters a ton.

If you can turn a wrench take the warrenty money and bank it. When you need a part, pull the coin from the bank and buy the part. You'll end up money ahead.

If you can't wrench on cars (Nothing personal dude, just saying it like it is) maybe think aboot running away from this burban and the dealer that's trying to push you into something.

[delcecchi]

I don't think you can approach it from just the cost of worst case though. It's the odds of break even or payback, for lack of better terms, on a covered repair that determine it.

We already know that the expected return is less than the cost of the policy (or the company would go broke). If I buy an extended warranty it is generally because there is a possibility of something happening that I couldn't cover or at least it would be extremely painful to do so.

So if I buy a 300 dollar TV I don't pay 89 dollars or whatever to buy the extended warranty. If it dies I am only out 300 which I can afford and I know that the likelihood of that happening is small. On the other hand I have insurance on my house, cuz if that blows up or burns down I couldn't afford to just build another one. So I pay the 1000 per year.

That's where I was coming from.

[Tom7227]

If it's like the extended warranty on electronics the salesman is getting a huge cut off the top. From then on it's purely an insurance policy. Even if everything is on the up and up the company has spent a lot of dough concluding that they win. On the other hand how much better vehicle can you buy if you put that $3,800 into the purchase?

[Whoaru99]

That's where I was coming from.

I understand, completely. It was part of my job for some time to calculate the costs for this sort of thing. We didn't lose money.

It's all about the odds & risk management. If you can't tolerate the risk/self-insure then buy the policy...knowing full well that the odds are against you actually needing it.

[delcecchi]

One could think of it as an anti-lottery ticket. One you buy and spend a little on the small chance you will be lucky and win a lot. The other you buy and spend a little on the small chance you will be unlucky but not lose a lot.

[DANR]

Another consideration is how much traveling you do. If you have a problem at home you can work it out with your local guy. If you're 300 miles from home you're at a stranger's mercy and some will unfortunately take advantage of it

[Whoaru99]

The main thing is to know what you're getting for your money. Nothing worse than spending $3k, or whatever, to find out later the only parts that are covered are the ones that don't break.

[Jeremy airjer W]

Read the Fine print!

If there is a major issue many times they will send an adjuster to look over the problem AND the service records. Fail on service and you will get denied.

The other part is the cost of the coverage Vs. the cost of repairs.

I don't buy buy them but I can also fix anything that goes wrong for the price of parts.

one of the things I see a lot are front end parts that are ready to fall off but get declined because they don't meet the measured spec for replacement. they pretty much have to be broken before they cover the cost.

the other thing I see a lot is they only pay the national average for parts and labor. If the shop labor rate is more you get stuck with the difference.

[S.D. Ice Angular]

Thanks for the feedback guys, I will try and answer a few questions to move this along.

I bought the rig without the warranty but can add it within the next 30 days if I change my mind.

They wanted $1800.00 for 3 years 36,000 miles. I would be amazed if I put 5,000 miles a year on this rig.

Eric, (No offense taken) I can wrench, I do all my own maintenance about the only thing I cannot do, due to lack of equipment is pull and engine, drop a tranny or transfer case. Otherwise I do everything else with no issues. So I was only going to buy this for the big jobs with hopes it would cover the smaller items also.

I did speak with (2) independent service shops in my local small town. Neither one of them heard of this “Warranty Company” before. The name of the company is ASC Warranty. Neither local shop said they would deal with them, but if I wanted to they said fine. In other words they bill me and I deal with the warranty company to get my money back.

In 2007 I bought a brand new boat in St. Cloud and was talked into buying an aftermarket extended warranty for $700.00 The 3 times I tried to have service work done on it at the local repair centers in the Alexandria area, they said the same thing. You are responsible for the price of the repairs; you deal with the warranty company to get reimbursed. Needless to say I did all the work myself.

[ski_otter]

3 more things to factor

1 - is this vehicle prone to high dollar repairs within the extended warranty period?

2 - make sure you know what your deductible for repairs will be

3 - different companies offer service contracts. You are not obligated in any way to choose the one that the dealer offers. If you are leaning toward a service contract do a bit of research online. I'd start with better business bureau and maybe consumer reports to find out the company's reputation