When you buy a car should you get an extended warranty?
Buy a new car and you’re getting a manufacturer’s warranty for anything from three to seven years. That’s the sort of peace of mind you want, but what if the car is a used example and doesn’t have any warranty left?
That’s when mechanical breakdown insurance – MBI, which is what an aftermarket warranty actually is – could play its part. But there are different types of warranty, with different limits and conditions, so it’s worth checking out your options. Only, we’ve done that for you!
Types of warranty
Extended car warranty comes in three main flavours. There is of course the manufacturer’s warranty and you can often extend that if it hasn’t run out.
Independent providers also provided extended warranties, while the third source is something like the car supermarkets or used car dealers. They often have their own warranties, which can extend from a month up to a year.
As a useful yardstick, you want cover that includes the failure of major components like the engine. Normal wear and tear is not the main thing you should be focusing on.
The cost depends on the vehicle – what it is, how old it is and what the annual mileage will be. With this, you can then pick the level of cover and the items you want covered.
It’s important that you clearly understand what is and isn’t covered, but we’d suggest suspension, engine, transmission, electrics and steering are all covered.
What to choose
Be honest and realistic as you sort out what cover you need. Exceeding the mileage limit you’ve agreed will cost you or invalidate the warranty, so think carefully. Check policies so they really are like for like, then read the small print. It’s dull, but you need to know what you’re agreeing to in detail.
For example is labour included? If not that can be a big bill added on later. Have you checked where the car can be serviced? Does it have to be at a main dealership or can you use your go-to local specialist? On that subject, make sure you don’t miss a service, get it in on the button or again that may cause problems.
Three key phrases
While you’re squinting at the small print, you’ll come across three important phrases: ‘betterment’; ‘consequential failure’ and ‘wear and tear’. Here’s what they mean in this context.
Betterment is where say your gearbox fails. If they fit a new box then the car’s in better condition than it was with the old worn box before it failed. That’s betterment, and you may be expected to pay for the improvement. Check out that small print.
The second scenario is where you have some parts covered, but another part fails. That in turn leads to one of the covered parts failing. You could be expected to pay for the non-covered part is it led to the failure of the covered part. Read your warranty terms before signing.
Wear and tear needs less explanation, but just make sure which consumables are covered and which aren’t.
It would be tempting to simply take the extended warranty offered by the company selling you the used car. However, shopping around is the best bet. There are some good and bad deals out there, but to help keep you safe make sure the scheme is backed by The Motor Ombudsman’s Vehicle Warranty Products Code. That gets you Trading Standards on your side.