Should I Buy an Extended Car Warranty?

Over the years I have had friends, family, and even co-workers ask whether or not they should buy extended car warranty solutions. My first question is how much they have saved for car repairs. Do they have an emergency fund? Most of the time the answer is zero. It’s no surprise though because saving for car repairs seems to be the most overlooked thing out there.

It leads to unexpected situations that end up becoming a financial burden, which takes away from other obligations. After all, these issues can happen that you only have a minimal amount of control over. It’s why I believe you have to have protection so you aren’t dealing with an added expense when you can’t afford it.

Obviously what I believe might not be the same as you, which is why I want to give you some information on it today. Hopefully, this will make your decision process easier if you consider:

• What an extended car warranty is

• Why you should buy an extended car warranty

• What to look for in an extended car warranty

If you’re not familiar with an extended car warranty it just refers to coverage that is considered added protection when your vehicle breaks down. So even though you have a standard warranty from the manufacturer, an “extended” version goes beyond those limits.

It’s important to understand that a manufacturer is the only one who can offer a warranty. So even though the term “extended car warranty” isn’t the best, it’s the easiest way to describe this protection.

Some dealers will refer to it as a Vehicle Service Contract (VSC), but others could consider it Mechanical Breakdown Insurance (MBI). For instance; California and Oregon utilize the MBI terminology, but each name means the same thing.

Here are a couple of reasons why you should buy extended car factory warranty coverage:

• Financial Security

• Peace of Mind

Financial Security

Due to the economy, many of us are feeling insecure about our finances. Whether it’s housing, food, health insurance, or even car payments. Once these are all covered it doesn’t leave much room for car repairs.

Then you have to think about the rise in costs when it comes to car repairs. So if you’re vehicle breaks down and the issue isn’t covered you will come out of pocket for the expenses. Those who buy extended car warranty coverage will reduce or even eliminate this risk, which can be a big load off your chest.

Peace of Mind

This is pretty self-explanatory considering the stress levels we all endure each day. When you get rid of this obstacle there won’t be any worrying about whether or not your car is going to break down. No one likes to get stranded on the highway or end up being late for an appointment because their car is working right. Plus, if you don’t have the money to fix it in the first place you could be hurting yourself when something goes wrong. This is definitely not a good feeling at all.

Taking the steps to protect your vehicle and your finances is the main goal. When you buy extended car warranty coverage you receive additional benefits like:

• Trip Interruption to pay your room and board when you’re stranded far from home.

• Emergency Roadside Assistance to get your vehicle towed off that busy street.

• Rental Car Coverage to place you in another car to get you to that appointment.

Another question I always get is what type of coverage you should focus on when purchasing an extended warranty. While I usually joke around about making sure the cup holders are taken care of, it’s actually the acronym CUP that I’m referring to:

• C – Contract Provisions

• U – Underwriter/Administrator

• P – Price

Contract Provisions

These are considered the nuts and bolts of the contract. This information is extremely important when you’re looking to buy extended car warranty coverage. I recommend reading over the fine print, because the claims adjuster will determine your vehicle coverage around the exact provisions. So figure out what you’re getting upfront so you have peace of mind if something does happen.


When discussing the underwriter they are how you actually get your extended car warranty, while the administrator deals with claims and cancellation functions. If you can find a company with both then you will be extremely lucky. When all the important aspects are joined together in one location, it makes life a lot easier. If you utilize different companies for each of them you will see mistakes that slip through the cracks. Why settle for this when you can do a little research and find a company that offers both?


Last but certainly not least is the cost. Most of the time we base our decisions on budget, even if it means losing out on other benefits.

All I can tell you is the lowest price won’t usually come with the best car warranty. This is a short-term solution and eventually, you will end up paying more if you take this route. So take the time to make sure that all your essentials are covered before making a purchase. Sure you might spend a little more money each month, but when something occurs you will be covered. Why pay for something that won’t give you everything you need, especially when it is as serious as car repairs? Just buy extended car warranty coverage that is perfect for your needs and you will relieve the extra stress and anxiety from your everyday life.



There are no comments yet

Why not be the first

Leave a Reply

More 1153 posts in DIY category
Recommended for you
Recovering From Car Accident Injuries

Car accidents can wreak havoc on victims' lives, causing physical injuries, emotional trauma, and financial…