Extended warranty


#1

2004 volvo xc90,51,000 mis. giving car to daughter who plans to put another 50,000 mis over next 3-4 yrs. does it pay to buy an extende warranty?


#2

Good read/survey --> http://www.consumerreports.org/cro/cars/new-cars/buying-advice/extended-warranties-4-08/overview/extended-warranties-ov.htm

If you decide to go with one only use a Volvo backed one not a third party which tend to go out of business and have really poor reputations.


#3

YES! But be very careful about what the warranty covers and doesn’t cover. I bought an extended warranty (I’m probably not allowed to tell you that the warranty was with Wynn Warrantys) that was basically useless. It would not cover fluids needed to be replaced with repairs, any suspension parts even though they admitted that many four-wheel-drive parts are part of the drive train, etc. It was very useful when the head gaskets, and transfer case on my 2000 Bravda went out within three years of each other. After the last head gasket the engine should have been rebuilt but they would not approve it.


#4

Norm is right that you need to be careful to understand what is covered and what is not. Else you could wind up very unhappy. Extended warranties are not sold because of people’s good nature. They are sold because they are extremely profitable. So very careful of what is covered and then you decide if the cost is worth the coverage and not having to worry.


#5

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 $500 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. 

Good Luck