Anyone have experience buying one of these?This one is from Dealer Services in St Louis, MO, and is for my 2005 Cadillac DHS, which has 86,000 miles and has the GM extended warranty to 100,000. This advertised warranty is for another six years or up to 140,000 miles. Is it worth investigating? Has anyone bought one of these? Was it worthwhile?
Aftermarket extended warranties from any entity other than the car’s manufacturer are not a good idea. In addition to the fact that many valid repair claims are rejected by these firms, there have been several instances of these companies going out of business. Unlike a failed bank, there is no protection for people who lose money when an aftermarket warranty company goes out of business–and it has happened a number of times.
Put the money you would spend to buy this warranty in the bank instead. It will earn interest and if you need it for a major repair it will be there. I do not believe in extended warranties. They are profit for the seller and often totally worthless for the buyer.
After market extended warranties (really insurance policies as they are NOT warranties) are no better than dealer versions of the same thing and are likely the exact same thing without the dealer profiting. Well any car can have major expensive repairs. The profit to the salesman and company is usually over 50%. So for every $1,000 you spend the insurance company has less than $500 to pay for repairs or they will loose money, something insurance companies do not do. Some peop;le will get nothing back and some will get a lot more than they pay. Most will get far less. In addition you need to keep in mind that the insurer has worded it to eliminate as many expensive things as they can. Remember that the seller is out to make money and they get to write the rules and set the price. They are not going to sell them at a loss so one way or another they are going to have you pay more than they will pay out. Would you gamble with a car dealer who gets to set all the rules and knows all the odds? Your decision has to do with the value of the piece of mind it gives you. If that is worth the cost then buy it. Don't expect it to cover everything however, most are written to keep cost down and exempt what they know will cost them money.
I don’t know anyone that would EVER buy an extended warranty. They are just a very very very expensive insurance policy.
I should have done a search on this topic before I wrote - lots of good stuff already posted. However, I do have some food for thought:
When we got our first Cadillac DHS, a 2001, we knew we would be on the road a lot, and I knew we’d use up the factory warranty long before the covered 5 years, so we got GM MasterGuard which extended it to 100,000 miles, which we exhausted in less than four years. We had a problem with the heated seats, which our dealer couldn’t fix. We took it to him four times, none of the repairs lasted, and he wound up eating the $200 deductible, I assume because he never got the problem fixed (I didn’t ask him why he didn’t charge us for it). After I replaced the car (with about 114,000 miles on it), I learned from another source that the problem was a design flaw - Cadillac used wiring in the heated seats that was too fine, and fixed it with thicker wire in subsequent models. But the extended warranty saved us a good $3000.
We now have the 2005 DHS, which we have driven to Alaska, among other places, and so far have driven 86,000 miles in less than four years, with the extended warranty. I’ve used the extended warranty once, but the repair was less than the deductible, so it really hasn’t been necessary yet. But, I didn’t want to drive to Alaska in a car with an expired warranty, so I’m glad I have the extended warranty on it.
My thinking now, since this car has had so few problems, is to not try to extend the warranty any further, especially since a GM warranty will no longer be available. The GM MasterGuard warranty was very inclusive - anything not expressly excluded was covered, and I was very satisfied with it.
Bottom line, in my opinion, if you’re retired and drive a lot (25,000+ miles per year, in our case), an extended warranty might make sense, but the warnings about 3rd party warranties also probably make a lot of sense.
I appreciate all the replies - thanks for your input.