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Writer's picturePacman

Avoid Extended Car Warranty Scams


car with funny sign on it
Don't fall for this one

It's tempting to think you're doing the right thing in getting a extended car warranty. Don't do it. I know...I know, You think you're doing the right thing, the responsible thing. You're not. you want to do the right thing? Buy the right car. Are there lemons out there? Sure! But there are more of those worthless aftermarket warranties.


Cars are such nowadays that they can routinely make it 200,000 miles on their engines and transmissions. Doing simple maintenance like changing fluids regularly is all you have to do to keep the thing running. The electrical and other stuff? That's another story. Let's just say that when it comes to the other stuff, all cars are not created equal. And guess what? Warranty companies know this.


Question for you. You think Vegas just threw some slot machines together and told people to come on in and drink and stay for free so they could give money away to them? You think they just throw some odds together so they can lose money on bets? Of course they don't. What makes you think these warranty companies are gunna do differently?


You think they exist for the greater good of mankind? Or do you think they exist to make money? If you guessed the latter, you'd be correct. Unfortunately, these companies exist on the backs of folks who need them the most, but can afford them the least.

My sister asked me about the most dependable vehicle to buy, I told her Toyota. She went to Hertz and bought a Toyota. She also bought a warranty. I asked her why she bought the warranty and she said for protection. I pointed out to her that I recommended Toyota for it's dependability. I explained to her that she was overpaying by purchasing a warranty because of the dependability of the Toyota brand. She cancelled the warranty. She never had a problem with that car and she deprived a warranty company somewhere a chance at 100% profit.


The process that a warranty company uses is to first know what car they're warrantying. They have all the numbers on every vehicle they warranty. They know what parts go wrong, on what vehicle, and when. A dirty little secret auto manufacturers won't tell you is their cars aren't perfect. None of them. And each brand has issues they're known for. Toyota has a valve cover gasket issue on some cars at certain mileage. Nissan-CVT transmission. Most European cars-electrical issues. So it goes.


Nissan Murano
Read the fine print

Warranty companies employ actuaries that compile the numbers that tell them the odds of repairs on different makes and models and only warrant some things and not others. For instance, they may cover everything on a Toyota except valve cover gaskets on certain models after so many miles. Or that CVT transmission on a Nissan they will refuse to cover. See how it works? And if you happen to have one that covers everything then don't miss that fine print because you may have to prove you've changed the oil every time at the 3,000 mile mark and not a quarter mile over, lest it voids the warranty. Used car? Have receipts from every oil change? No? Good luck with that...


The nightmare list is long and the money you pay them plus any deductible is foolishly spent in my opinion. You're better off putting a few bucks aside to handle any sort of repair. But you're better off buying the correct vehicle in the first place. Check here for my post on the best vehicles for delivery work. And remember, delivery work is much harder on a vehicle, so if it's good for work it is infinitely better for casual use.


In the bad old days when there was no internet or YouTube it was hard to discern what vehicles were good or not. But now we have the tools to use to learn about cars and what to look for and tools to use. And remember...Google is your friend, warranty companies...not so much.


Happy Trails!




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