Should I Buy the Extended Warranty for my Automobile?

If you buy a new car or an old car from a dealer, you are likely to be offered numerous options in terms of warranties to pay for any repairs beyond the expiration of the manufacturer’s warranty. There are many other terms for an extended warranty and these include things like

  • mechanical breakdown insurance
  • service agreement
  • service contract
  • vehicle protection plan

Here are some important questions from for you to ask yourself when considering if ‘should buy the extended warranty for your automobile:

What Does the Extended Warranty Cover?

Some extended warranty offers make it sound as though all repairs will be covered but this is rarely the case as some repairs fall into the general ‘wear and tear’ category and therefore, aren’t eligible. These repairs can include things like brake pad replacements. It is therefore very important to study the contract carefully and also to work out whether you have to pay upfront and then claim back for any repairs or whether you don’t part with any money.

What Is Your Driving Style?

Extended warranties may cover all expenses for a certain number of years or miles or you may have to pay a proportion yourself and then the rest will be covered by the policy. It’s worth considering whether your car has or will have an excessive mileage based on your lifestyle and if so, an extended warranty may be worth it. Do some research to see how often things seem to go wrong with you car and how much spare parts are.

How Long Do You Plan To Keep The Car?

If having an extended warranty will reduce stress when your original warranty expires, then it’s worth it but of course it is always a gamble as you may or may not need additional cover. It also depends on your salary and whether a costly car repair would be a financial burden. If you’re someone who buys new cars and then upgrades them every few years so that they don’t depreciate too much, an extended warranty isn’t necessary as you shouldn’t come to the end of the manufacturer’s warranty.


The extended warranty is an individual decision but many times it is not worth the extra money.  If you don’t think it is for you, don’t feel pressured into taking on an additional cost that you do not need.