How Much Does an Extended Car Warranty Cost?

Revealing the real cost of your vehicle’s extended warranty.

byThe Drive Staff|
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Car buyers are afforded the option to extend a vehicle’s factory warranty coverage with an extended warranty in order to cover unexpected repair costs. But how much does an extended warranty cost?

The make, model, and mileage of the vehicle will determine the price. Extended warranty costs also vary from provider to provider, depending on the number of parts they are willing to cover and extra perks such as roadside assistance that are offered.

It’s helpful to understand what you’re getting when you choose to invest in an extended warranty for your vehicle. The last thing a buyer wants is to end up paying more than average repair costs or spending extra on a warranty plan for coverage you already get from your car insurance policy.

To decide if this type of warranty is right for you and how much it may cost, we're sharing some of basic elements of extended warranties.

What Is an Extended Auto Warranty?

An extended auto warranty, or a vehicle service contract, is an optional cover for the major auto repairs and parts replacements for your vehicle. This cover can be purchased at any time, and it usually begins after the manufacturer’s warranty expires, although they may overlap. 

An extended warranty is different from your standard warranty in that it covers more parts for a longer period. While your factory warranty may last up to three years or 36,000 miles, extended warranties can increase coverage for seven years or longer, depending on the provider. Also, you don’t necessarily have to choose the extended warranty plan offered by your vehicle’s manufacturer. Automaker warranties are usually transferable and can be honored at any dealership nationwide. However, they may not be the most affordable option. 

Compare coverage prices offered by the vehicle’s manufacturer and third-party providers so you can end up with the best deal. Some providers will fight you for every penny by refusing to pay for parts or disputing labor costs. Therefore, you shouldn’t just take out a policy with the first provider your  dealership suggests. Take your time and look for the best provider with a track record of paying out claims. 

Each warranty provider will have eligibility requirements you have to meet to stay within coverage. Most warranty providers require your vehicle to have less than 75,000 miles to be eligible. If you buy a used vehicle that has a bit more than 75,000 miles, you can still get a used-vehicle warranty, although your choice of warranty providers will be somewhat limited. 

Extended warranties usually come in two main parts: inclusionary and exclusionary. An inclusionary protection plan only covers the repair costs for the parts listed in the contract. In contrast, an exclusionary contract will only list the parts that are not covered, so repairs for anything outside those parts are eligible for a claim. An exclusionary contract will be more expensive since it’s a more comprehensive plan. 

How Much Does It Cost?

Several factors determine the price of your warranty, including the make and condition of your vehicle, so auto warranty providers do not use a universal pricing scheme. However, the costs of the premiums can range from $1,000 to $2,000 and can cost even more if you select a comprehensive plan that lasts for several years. Expect to pay more premiums to cover luxury vehicles such as a Lexus, Jaguar, BMW, or Mercedes-Benz. 

Besides the premium, you'll have to pay a deductible. The general rule of thumb is that if you pay a lower deductible, you will have to pay a higher premium. The cost of deductibles can vary. There are a few warranty providers that don’t have deductibles, but the cost of the warranty is usually higher. Most warranty providers will give you a free quote, so you have the chance to compare it with other providers before you spend anything. 

The best part is that warranty providers offer different levels of coverage to suit everyone’s budget. Ideally, you can get up to three levels of coverage, but the basic ones are powertrain and bumper-to-bumper coverage. Expect to pay a lower premium if you only select powertrain coverage. You will pay more for bumper-to-bumper coverage for your vehicle and even more for a comprehensive plan that includes perks such as 24/7 roadside assistance, towing services, and rental vehicle reimbursement.  

Do I Need One?

Some people swear off extended warranties like the plague, while others find some value or peace of mind in extended coverage. To determine if you need an extended warranty, there are a few things you should consider before making the final decision.

  • Do you still have a manufacturer’s warranty? If your vehicle is still under the factory warranty, then an extended warranty may be an unnecessary purchase since most of the repair issues may still be covered under the factory warranty. However, if you aren’t on a tight budget, you can save money in the long run by getting an extended warranty; the sooner you get your vehicle protected, the less the premiums will cost since your vehicle will still be relatively new. 
  • How frequently do you experience issues that need to be repaired? Vehicles aren’t meant to last forever so it’s expected that they will experience a few issues, especially as they age. You need to consider how often your vehicle breaks down and estimate if it’s more affordable to pay for the repairs from your pockets instead of buying an extended warranty. An extended warranty can only save you money if your vehicle requires several extensive repairs almost every year. 
  • Is your car getting up there in age? The older your vehicle gets, the more it gets damaged from normal wear and tear. Therefore, you need to spend more on maintenance and replacement of damaged parts. You can save yourself the financial burden of unexpected repair costs by getting an extended warranty. 
  • Do you want to pay for extra perks? Many extended car warranty providers don’t just stop with vehicle protection for some parts repairs and replacements. Roadside assistance and travel assistance are two common perks many extended warranties offer. This can help when emergencies or unexpected automotive issues arise while on the road. Some warranties also offer a free rental car when your vehicle is at a repair shop for long periods for expensive repairs. Read the fine print to make sure you know how the extra perks apply. 

Extended warranties have some pros and cons, just like any other automotive service. In the end, it’s about saving money. An extended warranty should keep more money in your pocket in the long run than what individual repairs and service costs will take out.


Q. Do I need an extended warranty?

You don’t necessarily need an extended warranty right away, especially if your vehicle is still covered under the factory warranty. You can buy it later on when your vehicle becomes unreliable and requires frequent major repairs. 

Q. What’s not covered under an extended warranty? 

Most extended warranty providers typically don’t cover wear items such as windshield wipers, tires, and brake pads. They also don’t cover maintenance items such as timing-belt replacements or oil changes. 

Q. Can I cancel an extended warranty?

Although it may be a hassle, you can cancel an extended warranty at any time. You may get a prorated refund for the remainder of your policy. 

Q. What voids an extended warranty? 

Engaging in off-road driving, racing, or other reckless driving activities may void the warranty. The insurer may also refuse coverage if you make major alterations or modifications to your vehicle.