What Are Auto Warranties?

When you purchase a new vehicle, you typically get an initial warranty from the manufacturer. This manufacturer’s warranty will provide repair and replacement for major components of your vehicle during the coverage period, although the timeline of manufacturer’s warranties typically only lasts for up to three years or 36,000 miles.

Some consumers choose to buy an extended warranty for their car that provides similar coverage for periods after the manufacturer’s warranty period runs out. An extended auto warranty can pay for major repairs and component replacements in your vehicle for as long as the coverage is in place, minus any applicable deductible required.


What Do Auto Warranties Cover?

Extended auto warranties cover the same auto components that a manufacturer’s warranty covers. A bumper-to-bumper warranty should include all major vehicle systems, your car’s air conditioning and heating, electrical components of your car, steering, any car safety features you have, high-tech systems like GPS, and hybrid vehicle parts such as a battery.

However, not all auto warranties are bumper-to-bumper, and some of the most affordable coverage options only include your car’s PowerTrain and other features less likely to break down. Before you buy an extended auto warranty, you should compare all the options available so you know exactly which of your car’s systems and components are included.

Meanwhile, you should also consider the fact that car warranties are not meant to cover everything that could possibly go wrong. For example, auto warranties do not cover basic wear and tear, regular maintenance, exterior or interior damage, damage caused by an accident, and plenty of other issues.


What Do Extended Auto Warranties Cost?

According to Endurance Auto Warranty, the average auto warranty costs consumers $350 to $700 per year. However, the amount you’ll pay can vary depending on where you live, the car you drive, and the level of coverage you purchase.


Are Extended Car Warranties Worth It?

Extended car warranties are most valuable when you have a lot of expensive car repairs come up during your warranty period. If your car is repair-free after you pay for coverage, on the other hand, you’re less likely to feel like your extended warranty was a good value.

Then again, extended car warranties can come with added benefits that can make your plan more beneficial. For example, you may qualify for roadside assistance, towing, rental car coverage, trip interruption coverage, and other perks that can make your plan seem like a better deal.

Also keep in mind that the value of your extended warranty will vary based on how much you pay for coverage. We suggest shopping around and comparing extended auto warranties so that you know you’re getting the best price for the coverage you want. In the meantime, look for providers with a money-back guarantee so you can cancel your coverage and get your money back if you change your mind.


How We Chose the Best Auto Warranty Companies

We compared more than 20 auto warranty companies in order to find the top providers in this space. We compared them based on the inclusions in their plans, the added benefits and protective perks you can qualify for, and the number of plans they had to choose from. We gave preference to auto warranty companies that offer a money-back guarantee, as well as providers that let you get your car fixed at any certified repair facility.

Finally, we focused on auto warranty companies that are transparent in terms of what their extended warranties offer. Plans with roadside assistance and 24/7 customer service also performed well in our ranking.