3rd party drive train warranies and IMS failures
12-10-2014, 06:53 PM
#16
Cast Iron Man
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Thread Starter
So that warranty looks like it covers up to the same purchase price as the vehicle, so if it is a 10k vehicle, then 10k is the cap from what I am seeing. While the things covered doesn't use the term "anything contacted by oil" that I see, it does contain a lot of timing components, which should be an easy sell in the case of an IMS bearing. Of course, you never know until you are in the situation on the phone with an insurance company that doesn't want to pay, lol!
12-11-2014, 01:05 PM
#17
Race Director
You have to be careful.
I read the fine print and based on the wording, lack of wording actually, I do not believe the IMS bearing is covered. While variable valve timing hardware is covered the IMSB is not part of that system directly.
What you are being told regarding touched by oil is just intended to get you to buy the warranty coverage. These are big profit makers for the sellers and they are profitable because the underwriting company knows how to word the coverage to exclude -- in a way that doesn't appear to exclude -- problem areas.
Certainly the IMSB is a problem area, probably the biggest problem area, and one you are especially interested in having covered, naturally.
Remember: Anything a car salesman tells you is intended to get you to buy the car as soon as possible and to pay as much for it as possible. The same applies to someone trying to sell you an extended warranty/service contract.
What you are being told will count for zilch when (if) the time comes for you to file a claim. Even if you get the parties to admit they told you what they did you would have to do so say in small claims court as you seek to be reimbursed for your out of pocket expenses to have the engine fixed/replaced.
Do not let your understandable concern about a possible iMSB problem and the understandable desire to protect yourself against it blind you to a warranty that in my opinion does not cover the very item you are most concerned about.
I read the fine print and based on the wording, lack of wording actually, I do not believe the IMS bearing is covered. While variable valve timing hardware is covered the IMSB is not part of that system directly.
What you are being told regarding touched by oil is just intended to get you to buy the warranty coverage. These are big profit makers for the sellers and they are profitable because the underwriting company knows how to word the coverage to exclude -- in a way that doesn't appear to exclude -- problem areas.
Certainly the IMSB is a problem area, probably the biggest problem area, and one you are especially interested in having covered, naturally.
Remember: Anything a car salesman tells you is intended to get you to buy the car as soon as possible and to pay as much for it as possible. The same applies to someone trying to sell you an extended warranty/service contract.
What you are being told will count for zilch when (if) the time comes for you to file a claim. Even if you get the parties to admit they told you what they did you would have to do so say in small claims court as you seek to be reimbursed for your out of pocket expenses to have the engine fixed/replaced.
Do not let your understandable concern about a possible iMSB problem and the understandable desire to protect yourself against it blind you to a warranty that in my opinion does not cover the very item you are most concerned about.
12-11-2014, 06:37 PM
#18
Three Wheelin'
+1 they are EXTREMELY profitable for the dealer
I sold cars for a while and it was not uncommon for a deal that went into finance as a $2000 loser to end up as a $2000 winner all because of them buying an extended warranty
I sold cars for a while and it was not uncommon for a deal that went into finance as a $2000 loser to end up as a $2000 winner all because of them buying an extended warranty
12-11-2014, 10:52 PM
#19
Burning Brakes
I wrote this a few years ago:
The cost of the extended warranty covers:
1. The expected costs of labor and parts for the expected repairs over the life of the warranty.
2. The cost of administering the claims (working with the mechanic, paperwork, etc).
3. The costs of selling the warranty.
4. The cost of administering the selling of the warranty.
5. The commission to the sellers (both salesperson, managers and company/dealer).
6. The profit to the warranty company.
By not buying the warranty, you save the costs associated with items 2 thru 6 above. You spare your mechanic the hassle of dealing with the insurance company. And you save yourself any anguish over what is and isn't covered. Nothing is.
By not buying an extended warranty, you accept the risk associated with item 1 above and its associated costs. I've heard repeatedly (from Consumer Reports analysis of the financial results reported by extended warranty firms) that is, on average, around 20 to 30% of the total cost of the warranty is paid out in repairs. And that seems reasonable given the other costs. But you save the costs associated with items 2 through 6 which are more than twice as costly as the expected costs of repairs.
Extended warranties are like a casino:
some who play will win
a very very few will win very big
most by far will lose
the casino will make a lot of money.
Only the casino odds are so much better...there the percent returned to the better is generally more than 80% as opposed to the warranty where it approaches 20-30%. Like a casino, you hear the stories of the people who win big and that persuades you to play. You mostly don't hear about all the many, many more people who lose.
Is the warranty cost worth the 70% to 80% premium to the risk?
Your answer and my answer may vary. We have different financial situations and different risk tolerances. (In retirement, I don't have most of my money in bonds or money market accounts. I accept risk and the potential reward premium it can bring over time. Even in 2008!)
I consider if I can afford to (out of pocket or by borrowing) pay for the worst case I'm insuring against. (After all, I do carry house insurance and auto insurance and personal liability insurance so I'm not against all insurances.) If my engine had a catastrophic failure, could I afford to replace it? In my case, the answer is yes. My house burns down? No. So I don't carry insurance for the car and do for the house.
I choose to save the costs of items 2 thru 6 and accept the risk myself. I do this for all appliances, electronics, etc. Over my long lifetime, I'm sure I am many many thousands ahead.
When I bought my 2-previous-owners 43K miles Boxster I could have assumed a warranty for a $100 transfer fee or the seller could have gotten a refund of $3k and reduced the car price by $3k. I took the reduced price. The warranty would now have expired and I'm about $2,400 ahead. But my experience doesn't say much about what your experience would be.
I recently got a quote for $3600 for a 13 month warranty on an '01S with 54k miles driven 3k a year and with no real history of problems. And then an offer of a $500 discount when I didn't take the initial offer. But for that warranty to make sense, the chance of a failure that would require a total engine replacement would have to be the warranty cost divided by the engine replacement cost...or about 20% chance of a failure within the warranty period of 13 months. Just doesn't seem likely.
Which leaves the question ... should YOU buy one? Only you can answer that question. Because only you understand your financial and emotional reaction should you be one of the few with many or very expensive ($7-18k to replace an engine) repairs. Yes, it can happen, even to a Porsche.
I would also point out the number of companies offering extended warranties that go out of business only to resume selling under another name in a week or so. Lots of fraud here. So if you do buy, buy only from a company you can trust and make sure of their financial structure and stability. Someone asked me about a company a few weeks ago and I found about 6 different corporate structures involved. Good luck figuring out who was really behind such a policy. To me just another reason to avoid these. Too many are sold by the same guy selling paint protection, rust protection, fabric protection and the like. All produce big profits for the sellers so they can't be very good bargains for the buyers. And the warranty sellers go out of business regularly, only to emerge under another name a week later.
If you do buy the warranty:.
Read the contract three times before signing. The actual warranty contract, not the sales literature. If they won't give you the actual contract to read before you buy, walk away.
Compare the list of problem areas on Boxsters with the list of covered items. Seals covered? Electronics? Suspension parts? Or only listed parts?
Ask the dealer and at least one independent mechanic in your area about their experience with the company. Some companies are low pay (low hourly rate resulting in the mechanic not wanting to do the work), slow pay and find excuses to call things uncovered. Same don't. Some will find ways to do the minimal amount of work instead of doing the repair the right way. Find out if your proposed company does it right. Will they pay their amount if you pay the extra to get it done right? Will the shop even deal with that warranty company (many won't)?
Figure out who really is behind the warranty. Often it is not the named seller but some financial entity. There is a list of the company behind the warranty on this Oregon state web site.
Many sellers are just brokers. They offer you the warranty that makes them the most money, not the one best for you.
Compare the warranty you are offered with one from a big reputable company that markets direct and thus has lower selling costs. Buying from the dealer adds about 3 layers of additional selling expenses (dealer, sales manager, salesperson) that you can avoid by buying direct.
Know the deductible amounts (do you pay per visit or per problem or per problem per visit, for example).
Consumer Reports (April 2008 issue, page 26) had an extensive article on Extended Warranties subtitled "High Priced Gamble". Their conclusions didn't differ significantly from those above.
I'm now where I don't know a single extended warranty company I can even halfheartedly recommend.
Oh, and an extended warranty is really just a service contract in legal terms.
Warranties Sold By A Porsche Dealer
There are no warranties backed by PNA (Porsche North America, the Porsche marketing organization in Atlanta) other than the CPO (Certified, Pre-Owned) program warranty available only on certain pre-inspected used cars sold by the Porsche dealer and authorized as CPO by Porsche. You can't buy a Porsche backed warranty for a car you already own or one you bought from other than the dealer. Though there are dealers selling third party warranties who will try and make it look like the warranty is a Porsche warranty, it just isn't so.
CPO
Porsche dealers sell Porsche Approved Certified used cars. A “Certified” or “CPO” car goes through a 2-page, 100-point inspection. The inspection is supposed to cover a lot but the value of the inspection would depend on who was doing it and the care they took. It doesn’t include some things like a compression or leak down test. It does other things less well than I would do them, only providing one reading on tire tread depth per tire rather than the 3 per tire (left, right, center) I would do, for example.
And a “Certified” car doesn’t come with all fluids flushed and replaced like I’d like to see. But it does make the car eligible for a valuable Porsche-backed warranty:
1. If the qualifying pre-owned Porsche Approved vehicle is purchased while still under the new vehicle warranty, the maximum coverage is 6 years/100,000 miles/160,000 kilometers from the original in-service date.
2. If the qualifying pre-owned Porsche Approved vehicle purchased is outside the new vehicle warranty, the maximum coverage is 2 years/100,000 miles/160,000 kilometers, whichever comes first.
“Certified” is a feature the dealer buys from Porsche of North America and is said to cost the dealer $1,550 plus the cost of the labor to do the inspection. For most low to medium miles per year drivers, it gives you an additional 2 years protection against the big failures, not for the little maintenance items. I’d figure it worth $1,500-$2,000. The dealer will try to convince you it is worth $3,600 or so. You can download the brochure that lists what it does and doesn't cover at http://www.porsche.com/usa/pre-owned-vehicles/approved/
In mid-2008, the terms of the CPO changed for the better. The inspection as of 1 August, 2008 is now 111 points, the coverage is exactly the same as the new car warranty in terms of items covered, the term is 2 years (or 2 years longer than any remaining new car warranty) and the mileage is 50k. You still need to get the coverage certification and terms in writing and get the in-service date in writing.
It pays to know which CPO program your car might be covered by and to get it the terms in writing if you are buying a car that was previously CPO'ed.
If you are looking at a CPO car, ask for the inspection and repair report done at the time of the inspection. You want this report in case there is something you discover later that is at variance with their inspection results. CPO also gives a towing service coverage that is certainly worth something.
Third Party Warranty
Beware if a dealer tries to sell you a "Porsche" warranty. Unless the car you are buying is a CPO'ed car, the warranty they are trying to sell you isn't anything but a third party warranty marketed by the dealer to make money. And may be accepted by other dealer service departments and independent mechanics, or it may not be.
I'd add now:
Oddly, in the UK you can buy an extended warranty from a dealer that is worth something and some reputable Porsche independents also sell useful warranties (or pre-paid service contracts).
The cost of the extended warranty covers:
1. The expected costs of labor and parts for the expected repairs over the life of the warranty.
2. The cost of administering the claims (working with the mechanic, paperwork, etc).
3. The costs of selling the warranty.
4. The cost of administering the selling of the warranty.
5. The commission to the sellers (both salesperson, managers and company/dealer).
6. The profit to the warranty company.
By not buying the warranty, you save the costs associated with items 2 thru 6 above. You spare your mechanic the hassle of dealing with the insurance company. And you save yourself any anguish over what is and isn't covered. Nothing is.
By not buying an extended warranty, you accept the risk associated with item 1 above and its associated costs. I've heard repeatedly (from Consumer Reports analysis of the financial results reported by extended warranty firms) that is, on average, around 20 to 30% of the total cost of the warranty is paid out in repairs. And that seems reasonable given the other costs. But you save the costs associated with items 2 through 6 which are more than twice as costly as the expected costs of repairs.
Extended warranties are like a casino:
some who play will win
a very very few will win very big
most by far will lose
the casino will make a lot of money.
Only the casino odds are so much better...there the percent returned to the better is generally more than 80% as opposed to the warranty where it approaches 20-30%. Like a casino, you hear the stories of the people who win big and that persuades you to play. You mostly don't hear about all the many, many more people who lose.
Is the warranty cost worth the 70% to 80% premium to the risk?
Your answer and my answer may vary. We have different financial situations and different risk tolerances. (In retirement, I don't have most of my money in bonds or money market accounts. I accept risk and the potential reward premium it can bring over time. Even in 2008!)
I consider if I can afford to (out of pocket or by borrowing) pay for the worst case I'm insuring against. (After all, I do carry house insurance and auto insurance and personal liability insurance so I'm not against all insurances.) If my engine had a catastrophic failure, could I afford to replace it? In my case, the answer is yes. My house burns down? No. So I don't carry insurance for the car and do for the house.
I choose to save the costs of items 2 thru 6 and accept the risk myself. I do this for all appliances, electronics, etc. Over my long lifetime, I'm sure I am many many thousands ahead.
When I bought my 2-previous-owners 43K miles Boxster I could have assumed a warranty for a $100 transfer fee or the seller could have gotten a refund of $3k and reduced the car price by $3k. I took the reduced price. The warranty would now have expired and I'm about $2,400 ahead. But my experience doesn't say much about what your experience would be.
I recently got a quote for $3600 for a 13 month warranty on an '01S with 54k miles driven 3k a year and with no real history of problems. And then an offer of a $500 discount when I didn't take the initial offer. But for that warranty to make sense, the chance of a failure that would require a total engine replacement would have to be the warranty cost divided by the engine replacement cost...or about 20% chance of a failure within the warranty period of 13 months. Just doesn't seem likely.
Which leaves the question ... should YOU buy one? Only you can answer that question. Because only you understand your financial and emotional reaction should you be one of the few with many or very expensive ($7-18k to replace an engine) repairs. Yes, it can happen, even to a Porsche.
I would also point out the number of companies offering extended warranties that go out of business only to resume selling under another name in a week or so. Lots of fraud here. So if you do buy, buy only from a company you can trust and make sure of their financial structure and stability. Someone asked me about a company a few weeks ago and I found about 6 different corporate structures involved. Good luck figuring out who was really behind such a policy. To me just another reason to avoid these. Too many are sold by the same guy selling paint protection, rust protection, fabric protection and the like. All produce big profits for the sellers so they can't be very good bargains for the buyers. And the warranty sellers go out of business regularly, only to emerge under another name a week later.
If you do buy the warranty:.
Read the contract three times before signing. The actual warranty contract, not the sales literature. If they won't give you the actual contract to read before you buy, walk away.
Compare the list of problem areas on Boxsters with the list of covered items. Seals covered? Electronics? Suspension parts? Or only listed parts?
Ask the dealer and at least one independent mechanic in your area about their experience with the company. Some companies are low pay (low hourly rate resulting in the mechanic not wanting to do the work), slow pay and find excuses to call things uncovered. Same don't. Some will find ways to do the minimal amount of work instead of doing the repair the right way. Find out if your proposed company does it right. Will they pay their amount if you pay the extra to get it done right? Will the shop even deal with that warranty company (many won't)?
Figure out who really is behind the warranty. Often it is not the named seller but some financial entity. There is a list of the company behind the warranty on this Oregon state web site.
Many sellers are just brokers. They offer you the warranty that makes them the most money, not the one best for you.
Compare the warranty you are offered with one from a big reputable company that markets direct and thus has lower selling costs. Buying from the dealer adds about 3 layers of additional selling expenses (dealer, sales manager, salesperson) that you can avoid by buying direct.
Know the deductible amounts (do you pay per visit or per problem or per problem per visit, for example).
Consumer Reports (April 2008 issue, page 26) had an extensive article on Extended Warranties subtitled "High Priced Gamble". Their conclusions didn't differ significantly from those above.
I'm now where I don't know a single extended warranty company I can even halfheartedly recommend.
Oh, and an extended warranty is really just a service contract in legal terms.
Warranties Sold By A Porsche Dealer
There are no warranties backed by PNA (Porsche North America, the Porsche marketing organization in Atlanta) other than the CPO (Certified, Pre-Owned) program warranty available only on certain pre-inspected used cars sold by the Porsche dealer and authorized as CPO by Porsche. You can't buy a Porsche backed warranty for a car you already own or one you bought from other than the dealer. Though there are dealers selling third party warranties who will try and make it look like the warranty is a Porsche warranty, it just isn't so.
CPO
Porsche dealers sell Porsche Approved Certified used cars. A “Certified” or “CPO” car goes through a 2-page, 100-point inspection. The inspection is supposed to cover a lot but the value of the inspection would depend on who was doing it and the care they took. It doesn’t include some things like a compression or leak down test. It does other things less well than I would do them, only providing one reading on tire tread depth per tire rather than the 3 per tire (left, right, center) I would do, for example.
And a “Certified” car doesn’t come with all fluids flushed and replaced like I’d like to see. But it does make the car eligible for a valuable Porsche-backed warranty:
1. If the qualifying pre-owned Porsche Approved vehicle is purchased while still under the new vehicle warranty, the maximum coverage is 6 years/100,000 miles/160,000 kilometers from the original in-service date.
2. If the qualifying pre-owned Porsche Approved vehicle purchased is outside the new vehicle warranty, the maximum coverage is 2 years/100,000 miles/160,000 kilometers, whichever comes first.
“Certified” is a feature the dealer buys from Porsche of North America and is said to cost the dealer $1,550 plus the cost of the labor to do the inspection. For most low to medium miles per year drivers, it gives you an additional 2 years protection against the big failures, not for the little maintenance items. I’d figure it worth $1,500-$2,000. The dealer will try to convince you it is worth $3,600 or so. You can download the brochure that lists what it does and doesn't cover at http://www.porsche.com/usa/pre-owned-vehicles/approved/
In mid-2008, the terms of the CPO changed for the better. The inspection as of 1 August, 2008 is now 111 points, the coverage is exactly the same as the new car warranty in terms of items covered, the term is 2 years (or 2 years longer than any remaining new car warranty) and the mileage is 50k. You still need to get the coverage certification and terms in writing and get the in-service date in writing.
It pays to know which CPO program your car might be covered by and to get it the terms in writing if you are buying a car that was previously CPO'ed.
If you are looking at a CPO car, ask for the inspection and repair report done at the time of the inspection. You want this report in case there is something you discover later that is at variance with their inspection results. CPO also gives a towing service coverage that is certainly worth something.
Third Party Warranty
Beware if a dealer tries to sell you a "Porsche" warranty. Unless the car you are buying is a CPO'ed car, the warranty they are trying to sell you isn't anything but a third party warranty marketed by the dealer to make money. And may be accepted by other dealer service departments and independent mechanics, or it may not be.
I'd add now:
Oddly, in the UK you can buy an extended warranty from a dealer that is worth something and some reputable Porsche independents also sell useful warranties (or pre-paid service contracts).
12-12-2014, 07:37 AM
#20
Cast Iron Man
Rennlist Member
Rennlist Member
Thread Starter
Thank you for the input guys. For the discussion they are not selling an additional warranty. This is a warranty that they claim is on ALL the cars that they sell with under 100k miles on them at the time of the sale. I asked how much without the warranty and they said the price would not change.
Here is a link to the listing: http://www.coonrapidschrysler.net/al...ions=compliant
Here is a link to the listing: http://www.coonrapidschrysler.net/al...ions=compliant
12-12-2014, 09:42 PM
#21
Race Director
Thank you for the input guys. For the discussion they are not selling an additional warranty. This is a warranty that they claim is on ALL the cars that they sell with under 100k miles on them at the time of the sale. I asked how much without the warranty and they said the price would not change.
Here is a link to the listing: http://www.coonrapidschrysler.net/al...ions=compliant
Here is a link to the listing: http://www.coonrapidschrysler.net/al...ions=compliant
Regardless, the fine print doesn't mention the IMSB in any way that I find reassuring the bearing if it fails would result in the warranty claim being honored.
Additionally I read where seals/gaskets are not covered if the odometer is over 100K miles. If the IMSB failed it probably fails due to the seal failing so this is an out.
Also, even if you assume the IMSB is covered where will the car be fixed? If the dealer truly underwrites its own warranty coverage it does so with the idea that its costs to repair a vehicle are lower as it has the personal there to do this and gets parts at its cost.
In the case of your Boxster if the worst should happen, do you really want it repaired at this dealer?
What if the engine is not repairable? BTW, a few years ago I priced a replacement 27.L engine for my 2002 Boxster. With a suitable core it was $17K. Without it was $26K.
Will the dealer then just order up a new engine from a nearby Porsche dealer and have it installed, preferably by the Porsche dealer so there is a 2 year 24K mile warranty on the engine and its installation.
I'd hate to be in the same building when the GM of the dealer writes and signs that check.
12-13-2014, 07:53 PM
#22
Wax On, Wax Off
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One other thing that people may have mentioned but I didn't notice so far...
Extended warranties, some of them say if the cumulative repair total approaches a certain percentage of the value of the car, they can total the car, cancel the warranty, pay up to that amount, etc. so say you bought a 12k car. A few years down the line, the depreciated total value is 10k. You've had $1500 in repairs done thru the warranty. They pay up to 70%. You engine ****s the bed. They pay out $5500, and take your car, or just give you that towards the repair.
Extended warranties, some of them say if the cumulative repair total approaches a certain percentage of the value of the car, they can total the car, cancel the warranty, pay up to that amount, etc. so say you bought a 12k car. A few years down the line, the depreciated total value is 10k. You've had $1500 in repairs done thru the warranty. They pay up to 70%. You engine ****s the bed. They pay out $5500, and take your car, or just give you that towards the repair.
12-15-2014, 11:50 AM
#24
Race Director
We're not trying to discourage you from buying a Boxster. I have owned my 2002 Boxster since Jan 2002 and it has been a wonderful automobile, the best one I've owned. The odometer recently rolled over 288K miles, so the car gets driven a lot.
You are not only buying a car, seeking to buy a car, but a warranty with the car. The warranty appears to be a pretty must have "option" for you, which is understandable.
All I am trying to do is make you aware of how easily some warranty companies manage to protect themselves from huge claims. These companies are not in business because they like to pay out huge sums of money when something goes wrong. They like to collect huge sums of money when someone buys their coverage and pay out as little money as they can when something goes wrong and a claim is filed.
I have talked to techs at the dealer about these 3rd party warranties. The techs tell me when a car is brought in with a serious problem and a claim is initiated a rep from the warrant company descends upon the service department, the tech who is working on the car, asking about a zillion questions of the tech, with the idea of finding a reason to deny the claim.
This is understandable as the warranty company wants to avoid paying out if fraud, abuse, misuse are to blame for the claim.
Unfortunately when the warranty is presented to a car buyer often (dare I say always) the warranty company is painted as a very benevolent company that just tosses hundred dollar bills around with abandon whenever a claim is filed.
This is not to say these companies are crooked. They are very careful in how they write their coverage to avoid any loop holes that can set them up for a large payout and over a number of vehicles not just yours.
Since the warranty company writes the coverage and holds the money and has the determining say in how it will interpret the cause of the claim and whether it will recognize the claim as valid and will not pay out any money if there is any justification for denying the claim you are at an extreme disadvantage.
You have to pay out of your pocket to get the car fixed then go after the warranty company later. Or the car sits for months and months until after you are successful (assuming you are successful) in getting some kind of settlement. Then you have to collect, which is not always the same thing as winning.
So you want to be very sure the most serious problems the car/engine could experience during your time with the car are covered. You need more than just a car salesman's verbal assurances. You need to read the fine print not as someone who has fallen in love with the car and reading the contract through rose colored glasses, wanting to see no reason in the fine print to end the relationship before it even got started, but instead reading the fine print using a high powered magnifying glass seeking any reason in the fine print to call off the relationship before it even gets started.
Sorry, but I wanted to add this: Of course it is your decision and you can chose to interpret the fine print anyway you want to. I'm no expert on warranty contracts and I have only owned one 3rd part warranty on a car (and when I went to file a claim -- for a leaking radiator -- I found to the warranty didn't cover leaking radiators) it is just over the years I have encountered enough owners who found out too late the coverage they thought was in place was not in place. Now I have also encountered some owners who filed a claim and were successful in having it recognized and received the settlement for which the bought the coverage. A 3rd party warranty offered by a good company and with the right coverage is a wonderful thing.
You are not only buying a car, seeking to buy a car, but a warranty with the car. The warranty appears to be a pretty must have "option" for you, which is understandable.
All I am trying to do is make you aware of how easily some warranty companies manage to protect themselves from huge claims. These companies are not in business because they like to pay out huge sums of money when something goes wrong. They like to collect huge sums of money when someone buys their coverage and pay out as little money as they can when something goes wrong and a claim is filed.
I have talked to techs at the dealer about these 3rd party warranties. The techs tell me when a car is brought in with a serious problem and a claim is initiated a rep from the warrant company descends upon the service department, the tech who is working on the car, asking about a zillion questions of the tech, with the idea of finding a reason to deny the claim.
This is understandable as the warranty company wants to avoid paying out if fraud, abuse, misuse are to blame for the claim.
Unfortunately when the warranty is presented to a car buyer often (dare I say always) the warranty company is painted as a very benevolent company that just tosses hundred dollar bills around with abandon whenever a claim is filed.
This is not to say these companies are crooked. They are very careful in how they write their coverage to avoid any loop holes that can set them up for a large payout and over a number of vehicles not just yours.
Since the warranty company writes the coverage and holds the money and has the determining say in how it will interpret the cause of the claim and whether it will recognize the claim as valid and will not pay out any money if there is any justification for denying the claim you are at an extreme disadvantage.
You have to pay out of your pocket to get the car fixed then go after the warranty company later. Or the car sits for months and months until after you are successful (assuming you are successful) in getting some kind of settlement. Then you have to collect, which is not always the same thing as winning.
So you want to be very sure the most serious problems the car/engine could experience during your time with the car are covered. You need more than just a car salesman's verbal assurances. You need to read the fine print not as someone who has fallen in love with the car and reading the contract through rose colored glasses, wanting to see no reason in the fine print to end the relationship before it even got started, but instead reading the fine print using a high powered magnifying glass seeking any reason in the fine print to call off the relationship before it even gets started.
Sorry, but I wanted to add this: Of course it is your decision and you can chose to interpret the fine print anyway you want to. I'm no expert on warranty contracts and I have only owned one 3rd part warranty on a car (and when I went to file a claim -- for a leaking radiator -- I found to the warranty didn't cover leaking radiators) it is just over the years I have encountered enough owners who found out too late the coverage they thought was in place was not in place. Now I have also encountered some owners who filed a claim and were successful in having it recognized and received the settlement for which the bought the coverage. A 3rd party warranty offered by a good company and with the right coverage is a wonderful thing.
12-15-2014, 07:37 PM
#25
Cast Iron Man
Rennlist Member
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Thread Starter
You are not only buying a car, seeking to buy a car, but a warranty with the car. The warranty appears to be a pretty must have "option" for you, which is understandable.
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Sorry, but I wanted to add this: Of course it is your decision and you can chose to interpret the fine print anyway you want to. I'm no expert on warranty contracts and I have only owned one 3rd part warranty on a car (and when I went to file a claim -- for a leaking radiator -- I found to the warranty didn't cover leaking radiators) it is just over the years I have encountered enough owners who found out too late the coverage they thought was in place was not in place. Now I have also encountered some owners who filed a claim and were successful in having it recognized and received the settlement for which the bought the coverage. A 3rd party warranty offered by a good company and with the right coverage is a wonderful thing.
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Sorry, but I wanted to add this: Of course it is your decision and you can chose to interpret the fine print anyway you want to. I'm no expert on warranty contracts and I have only owned one 3rd part warranty on a car (and when I went to file a claim -- for a leaking radiator -- I found to the warranty didn't cover leaking radiators) it is just over the years I have encountered enough owners who found out too late the coverage they thought was in place was not in place. Now I have also encountered some owners who filed a claim and were successful in having it recognized and received the settlement for which the bought the coverage. A 3rd party warranty offered by a good company and with the right coverage is a wonderful thing.