Extended warranty. Are they worth it ?

[Pentalab]

My son bought his used 2018 Fusion back in June 2023. He was 100 miles north of me at the time. Somehow, the extended warranty got tacked onto the final paperwork. ( he was never asked if he wanted it). Car had just 87,500 kms on it at purchase. It now has 120,000 kms on it. The extended warranty was by TRI-CARE, and cost a whopping $5300.00 cdn....for just either (A) 72 months / 6 yrs...OR 100,000 kms over the odometer reading at purchase...whichever comes 1st.

It can be cancelled..... BUT is also pro-rated. She tells him he can only get $1600.00 back....due to their 'method' of pro-rating.
On the original paperwork, the 'exclusion' list is a mile long...with 23 generalized items.

Then I'm seeing all sorts of horror stories about tri-care. Like from independent repair facilities and dealers etc, who scrap on the phone every week with tri-care..... and then have to tell the customer, sorry, but you have to pay the $5700.00 bill since your....'extended warranty' isn't worth the paper it's written on. Then I find out it doesn't cover seals or gaskets, nor stuff like the alternator and water pump....and a ton of other stuff. They get real vague when questioned. "it depends on the exact item that failed'. They will not provide a detailed list of stuff they don't cover.

Water pump fails, eng overheats and blows up....."sri, eng not covered".

I'm trying to convince him to take the $1600.00 refund. IMO, extended warranties on used cars is a real scam. He's looking at..... it's only $1600.00 and is good for another 3.5 years. Extended warranties are a warranty issue, for oem defects. They are not a maintenance program.

Any thoughts on this?

 

[SilverMustangGT]

I'm not a big fan of extended warranties, but I did get one when I bought my new Ram 1500 a couple years ago. It's the Maximum Care warranty offered through Chrysler or whatever they call themselves these days. The dealership was offering at cost which was around $1,100 so I thought it was worth it. I was mostly concerned about all of the electronic gadgets they put on new vehicles...I think the powertrain on most vehicles are pretty reliable.

I don't think I would even consider getting a warranty through a third party. I think it would be much easier to deal with repairs when the warranty is through the manufacturer. Just take it to the dealer and let them deal their people.

 

[86GT351]

Being in the business I say yes. However, the only suggested warranties are the manufacturers warranty or the secondary warranty the dealer offers. We have seen too many horror stories with the "internet" based warranties. There are some that we refuse to take. They have there own pricing structure, etc. Some like Car Shield refuse to pay there bills. We had an instance that we got authorization for a 4000.00 plus repair with email confirmation. We advised the customer that all he had to pay was his deductible and he was happy. We complete the work and email the invoice for payent and then it turned into a "I'm sorry that employee that authorized was new and made a mistake" Client happened to be an attorney so we know who won that battle. Ther are others that charge thousands of dollars for coverage and will only pay is 80-90 per labor hour per the contract they have with the client. Problem with that is our Labor rate is 201.95 per hour. We end up getting paid but our client ends p geting upset because of being misled by them. They never read the contract that is all in black and white.

Moral of the story........Aftermarket warranties are like car insurance. Have to have them and hope you don't have to use it. With the cost of repairs these days due to electronics alot of repairs tremendously hurt the pocket.

 

[Forty61]

We got the extended warranty on my wife’s preowned Subaru and it actually helped when it needed rear wheel bearings and when the AC compressor crapped out, ended up costing us nothing both times. That said, it’s a Subaru backed warranty, I haven’t had any experience with the third party ones.

 

[Pentalab]

Just to be clear. My son bought the used Ford Fusion at a Nissan dealer. Nissan sells the 'extended warranty' via a 3rd party (TRI-CARE). No doubt, Nissan gets a huge cut from selling the extended 3rd party warranties. The extended warranty also has a $100.00 deductible on it. $5300.00 for an extended warranty on a used vehicle is a bit much imo.

 

[Laga]

Take the money the warranty costs and put it in a savings account. Then, it will be there if you need it. Take care of the vehicle with normal maintenance and don’t abuse it. Most problems arise from neglect.

 

[AHaze]

3rd party warranty companies are there to make money. The average customer is going to give them more money than than they get back. Of course, that doesn't mean nobody should get them. I have a life insurance policy which will definitely cost me more than it pays out if I live as long as I hope to, however I decided I was willing to pay for that risk mitigation.
I've never bought an extended warranty but I've always been able to fix my own stuff. My personal experience has been that even original manufacturers warranties are more hassle than they're worth.

 

[DieHarder]

Normally, I stay away from extended warranties but I did get Nissan's top-of-the-line 100k extended warranty for a 2017 Armada and glad I did as it developed what I thought was a rod knock at 45k but turned out to be piston slap and required a new short block. They fought me on it for a couple of weeks (regional mgr finally had to get involved) but turns out this is a known problem so they eventually covered it. Not sure what the materials and labor costs on that would have been (they had it for more than a week) but I'm pretty sure it was more than I paid for it (~$4K) and it's covered a couple of other repairs since that would have cost several hundred or more without it so in my case it was worth it.

 

[MrMonkeyShines]

I no longer purchase extended warranties because of the list of exclusions or implied exclusions that they mention. I've never had one pay out when something went wrong. Even when it's something that's covered, you will be required to show with receipts and documentation that you followed every detail of maintaining the vehicle per the manufacturer's schedule. Since I now perform most of the upkeep on my car it makes no sense to purchase one.
I agree with Laga, take the money and put it in a high-yield savings account earmarked for the vehicle's eventually needed repairs. If the repair cost's more than the thing is worth, trade it in and use the money as a down payment.

 

[MADGT]

I have prurchased from these folks before: https://www.lombardfordwarrantys.com/

They will send a mechanic to your house to check and test drive vehicle before approving warranty. Here are the instructions I got: "a Vehicle Inspection is required within 14 days of receiving your application for coverage before it can be accepted and registered. The cost to you for this Inspection is $119.00, non-refundable, which will be charged separately to your credit/debit card. The inspection will be performed by a representative from Centro Inspection Agency who will normally come to you, providing your location is not remote, otherwise a mutually agreed to location may be required."

Price may have gone up since this was a few yrs back