Validity of Extended Warranties?


My 2005 Ford Expedition’s original warranty will soon expire. I have received warranty extension option from Automotive Product Consultants (APC). I’m a single mom, can’t afford to waste money where not wise. Yet I’m not mechanically inclined. Any input??? Thanks! E


Take the amount of money they want for that Extended Warranty and go to your bank. Open up a 6-month CD, or a Money Market account. Put the money in there. Watch it earn interest and multiply.


Give it to this “Warranty company” who has worded that contract to make sure they never pay for a thing. If something goes go wrong (which it probably won’t) you’ll get an ulcer trying to deal with these people who are worse than the health insurance companies in getting to pay.

Put the money in the bank; you’ll come out WAY, WAY, WAY ahead.


We get this question maybe once every week. Try the search feature at the top of this page to see other responses.

In summary, most of the regular members of this forum advise folks to avoid these insurance policies. (Yes, that’s all they are.) It is difficult to collect anything from the insurers. Few people ever recover their premiums.


Good question. “extended warranties” are really insurance policies. 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


I agree with the other 3 members who have replied to your question. Be self-insured by SAVING the money you have spent on insurance.

These policies tend to have “co-pays” which are usually high enough to cover the complete cost of the repairs.

A worthwhile policy would only need two or three sentences to define the coverage. Something like:

“If your car breaks down before 100,000 miles or ten years, we will pay the entire cost of all repairs. This policy does not cover normal maintenance items or brakes parts or clutch parts”.

But you will NEVER buy a policy worded like that. There will be two pages of fine print that, in the end, will insure that YOU will pay the bulk of most repairs.


Yeah, take the amount of money equal to the warranty and put it in an interest-accruing bank account. Not only will you not have to actually spend the money (hopefully) the money will grow and will come in handy when you actually do need it, like when your kid(s) want to play sports, or go to college.


We don’t cover that is the aftermarket warranty excuse. There are many specific excuses too. You don’t have to be mechanically inclined to save the warranty money so that you can write the check for the future repair. You don’t want to pay for both the warranty and the repair.


Thank you so very much for taking the time to reply to my inquiry and give me some direction on extended warranties! Ellie


Thank you for taking the time to better explain the tactics involved with an extended warranty. This has helped me make a better and informed decision. Ellie


Thank you for your input. Greatly appreciated. Ellie


Thank you for your input. Ellie


Thank you for your input. Ellie


Thank you for your input. Ellie