What is the average cost of an extended warranty?
Extended auto warranties cost an average of $1,297 per year across providers, plans, coverage options and vehicles, based on our February 2025 secret shopping. Below, we provide estimates for bumper-to-bumper, mid-level and powertrain warranty coverage based on quotes we received during our secret shopping experience. What Does an Extended Warranty Cost? An extended warranty typically costs an average of $600 to $2,000 per year, but that varies widely based on where you buy the warranty, the reliability of the vehicle the warranty covers, and other factors. The price of an extended warranty also is negotiable.Bumper-to-bumper warranties: $1,000 to $5,000 On average, an extended auto warranty costs around $1,000 per year of additional bumper-to-bumper coverage. That figure is based on over 500 quotes we’ve collected for over 100 different vehicles, ranging in age from one to five years old.A comprehensive, or bumper-to-bumper warranty, covers every part your new car had when you bought it. For instance, a new 2024 Toyota RAV4 comes with a 3-year/36,000-mile comprehensive warranty.High-mileage cars: vehicles with over 100,000 miles can still be covered, but your plan may offer reduced benefits or higher premiums. Some extended car warranty companies now offer protection for high-mileage vehicles (up to 150,000 or even 200,000 miles), though these are typically more limited in scope.Extended auto warranties cost an average of $1,297 per year across providers, plans, coverage options and vehicles, based on our February 2025 secret shopping. Below, we provide estimates for bumper-to-bumper, mid-level and powertrain warranty coverage based on quotes we received during our secret shopping experience.
Is it worth paying for extended warranties?
Whilst it might be reassuring to have an extended warranty, they can come at a high price. And it still won’t necessarily cover everything that could go wrong. And, of course, you could find that the cost of the repair required was less than the price of the warranty. Or you may never need to use the warranty. When can I buy the Extended Warranty? The best time to buy the extended warranty is while buying your car. You can also buy your extended warranty later on, so long as the car is still under the new vehicle warranty. However, buying the plan later on implies a higher cost than when buying along with the new car.While circumstances vary, in most cases, extended warranties are not worth the cost. Extended warranties will add $1,000-$3,000 to the total cost of your car. In most cases, you’ll never see that money again.You can buy an extended car warranty from your dealer or car manufacturer when you purchase a new car or any time before the car’s standard warranty expires. Make sure you understand which parts are covered and for how long before you buy an extended warranty.While extended car warranties typically cover many issues that may require parts of your car to be repaired or replaced, they don’t cover everything. For example, many extended warranties don’t cover things like accidents, theft, natural disasters, or normal wear and tear.The original manufacturer’s warranty may have expired or be close to expiring. Used cars are more likely to need repairs than new cars. An extended warranty can provide peace of mind and protection against unexpected repair costs. The cost of the warranty should be weighed against the potential cost of repairs.
Is extended warranty a rip-off?
You’re effectively paying upfront for protection you may never use. Extended dealer warranties also come with plenty of fine print. They often exclude everyday wear and tear, common modifications and key parts or systems. Cons of an Extended Warranty Extended warranties require an upfront payment or are added to your financing, increasing your total cost. If you don’t end up using it, you may feel like you paid for something you didn’t need. Depending on the warranty plan, some repairs may not be included.Instead of buying a bunch of extended warranties that you’ll probably never use, you’re better off self-insuring by paying yourself the warranty payments. That way, if your TV does break after the normal warranty, you have the money saved to fix it. If not, it’s your money to keep. It’s a win-win!Will my car payment decrease if I cancel an extended warranty? If your warranty was included in your financing, your monthly payment will not decrease, but the refund may be applied toward your loan balance.
What are red flags in extended warranties?
What are red flags in extended warranties? Common red flags of car warranty scams include unsolicited communications claiming your warranty is expiring, scare tactics, ambiguous coverage details, and pressure to pay upfront or divulge personal information. A full warranty is pretty comprehensive, covering most defects. A limited warranty, on the other hand, might only cover specific parts or certain types of problems. So, while the repair might be free, what gets repaired is defined by the warranty’s scope. Legally speaking, a warranty is a binding commitment.Typically, an extended warranty covers the failure of a part or component of the product due to the malfunction of the unit or one or more of its parts or components. The extended warranty is on the furnace, boiler, or air conditioner and not on accessory components not included as part of the equipment.A car warranty covers certain mechanical and electrical faults. This can include engine and gearbox issues, but always check what a warranty does and doesn’t cover, as there’ll usually be exclusions. There are different car warranty types. Including manufacturer’s, used car, third-party and extended warranties.Like all warranties, though, extended warranties tend to have exclusions that you have to be aware of. Things like wear-and-tear items, maintenance, and cosmetic components are generally not covered, and it is important to understand what exclusions your plan has.If your new car has a serious warranty defect that the manufacturer cannot fix, even after multiple attempts, you may be eligible to get your vehicle repurchased or replaced.
Can I negotiate extended warranty price?
Generally, these warranties come with a higher profit margin, giving you the chance to negotiate as much as you can. Just like the price of the car, dealerships may increase the cost of the extended warranty coverage plan for their profit. Extended warranty plans typically cover your vehicle anywhere from 2 to 7 years. If you expect to keep your car for several years, a longer plan may make sense for you. Even if you do sell your car before the warranty runs out, your extended protection plan may be transferable.It is never too late to add an extended warranty or vehicle protection plan to your car and get the kind of coverage you need to feel confident about unexpected repairs. Ideally, the best time to obtain extended coverage is as soon as your factory warranty expires.Trade-In Realities As mentioned, a dealer accepting your car for a trade-in will want to sell the new owner a separate extended warranty. So, the best way to maximize value is to cancel coverage and get a refund. Don’t trade in a vehicle protected by an extended warranty without taking this step.It is possible to buy an extended warranty after you purchase your car. It can even be some years later. Buying an extended warranty or Vehicle Service Contract after purchase is a wise idea. As your car ages the more likely it will be to run into the need for repairs due to general wear and tear.
How much should a 100,000 mile extended warranty cost?
This means you should expect to pay between $1,000 and $4,200 on a 36-month coverage term (paying for 18 months) for an extended warranty on a vehicle with more than 100,000 miles. As you put more mileage on your vehicle, the likelihood of needing a repair goes up, increasing the price you’ll pay for your warranty. An extended warranty typically costs an average of $600 to $2,000 per year, but that varies widely based on where you buy the warranty, the reliability of the vehicle the warranty covers, and other factors. The price of an extended warranty also is negotiable.However, if you typically upgrade to a new car every few years, the manufacturer’s warranty might suffice. Financial Peace of Mind: An extended warranty can offer financial security, as it can protect you from unexpected repair costs.