How Much Does an Extended Car Warranty Cost?

Don't get surprised by the real costs many extended car warranties have.

The Drive and its partners may earn a commission if you purchase a product through one of our links. Read more.

Considering buying an extended warranty for your vehicle? Wondering what the extra cost may be? This is a typical position to be in when figuring out whether an extended warranty is your best option. Many people find some extra comfort in an extended warranty, including services and perks most manufacturer warranties from a dealership don’t offer. 

However, all of these extras depend on the cost. Why bother with an extended warranty if you will end up paying more than what an average repair may cost?

Extended warranties, also known as vehicle service contracts, are a bit controversial in the automotive world. Some people argue they are pointless, money-grabbing schemes to needlessly drain your wallet. Others find some value in an extended warranty, especially when the manufacturer warranty is about to expire.

To help you decide if this type of warranty is right for you and how much it may cost you, here’s our handy guide on some of the basic economics of extended warranties.  

BETTER EXTENDED COVERAGE WITH ENDURANCE

Get $350 off an Endurance warranty plan with coupon code: DRIVE350

Going with a factory extended warranty is a good option for basic protection, but you can get more and save more with an Endurance extended warranty. Offering more comprehensive coverage on repairs and services OEM warranties list in exclusions, an Endurance warranty actually provides the type of coverage many disappointed vehicle owners assume automakers just include automatically. Best of all, an Endurance plan isn’t limited by a vehicle’s mileage or age, so you can cover your vehicle no matter what.

What Is an Extended Auto Warranty?

The term “extended warranty” is a bit misleading since this actually isn’t a warranty like traditional bumper-to-bumper and powertrain warranties that come with a new car. Instead, it’s just a vehicle service contract: an extra service from manufacturers and third-party providers that usually make repairs and part replacements more affordable. 

In other words, it’s something extra you can sign up for, even with a new or used car.

Compared to new-car and CPO warranties, extended service contracts tend to cover more in terms of repairs and regular maintenance for extra cost. Most true warranties from automotive manufacturers only cover defects instead of routine maintenance or regular wear and tear. If a part wasn’t made right and eventually prevents your car from running, that’s when a manufacturer warranty will kick in. 

If you just want to save some money on an oil change, you’ll be out of luck.

Extended warranties vary from provider to provider, but they usually always cover more than standard warranties. They also aren’t the same as car insurance. For example, normal part replacements (usually OEM or manufacturer-approved parts) fall within the coverage of an extended warranty. Some routine maintenance, like oil changes, and emergency services, like flat tire repair, can also be covered.

While they cover a lot more than the factory warranties, extended service contracts don’t include everything on your car. That is why extended warranties come in two main flavors: inclusionary and exclusionary. Inclusionary extended warranties essentially list the different areas or part types they cover. This may include engine parts, suspension parts, and electronics. Anything not on the list isn’t covered.

Exclusionary extended warranties, on the other hand, take the opposite approach. Anything listed is actually excluded from the service. These tend to be more comprehensive since the exclusion list is overshadowed by everything else that is automatically covered under the service.

How Much Does It Cost?

Unfortunately, this isn’t an easy question to answer. Extended warranties can range from around $500 to $2,000, depending on several factors. There is no universal pricing scheme that manufacturers and third-party providers follow to set the rates of extended warranties. 

The cost varies from provider to provider, and it can even depend on the vehicle itself. The good news is you can get quotes before making a decision, but it helps to know how pricing is determined in the first place.

The ultimate cost of an extended warranty protection plan is influenced by the provided services and the vehicle. Basic warranties that only cover simple repairs tend to be cheaper. Expansive warranties that offer additional perks like roadside assistance or travel help will naturally cost more. 

The condition of the vehicle is also a major factor in the cost. Older vehicles with more miles tend to need repairs and replacements more frequently. Therefore, the age, mileage, and history of the vehicle all have some influence on the final cost. The more “used” a vehicle is, the more expensive extended coverage will probably be.

The average monthly payment for an extended warranty is around $1,200 to $1,500, but this can vary widely depending on the aforementioned factors. This is why it’s important to do some research ahead of time on different providers and to get quotes. Until you know exactly what a provider quotes for your vehicle, it’s all just a big guessing game that won’t give you much helpful information.

GETTYIMAGES

Extended warranties can save you some money for service repairs, especially when the unexpected occurs. 

Do I Really Need One?

The choice to buy an extended warranty or not is mostly a personal one. Some people swear off extended warranties like the plague, while others find some value or peace of mind in the extended coverage. To determine if you need an extended warranty or not, there are a few things you should consider before making the final decision.

  • Do you still have a manufacturer’s warranty? If your car is fairly new and is still covered by its original bumper-to-bumper or powertrain warranty, an extended warranty might not be necessary since the vehicle is less likely to experience normal issues. Chances are that any problems that do arise will be due to defects covered by the standard warranties.
  • How frequently do you experience issues that need to be repaired? Some cars can run for hundreds of thousands of miles without experiencing any major complications; others tend to break almost immediately after they get off of the lot. If your car doesn’t require too much-unexpected maintenance, you may save some money skipping the warranty and just paying the repair facility directly. Extended warranties really save money, however, when frequent or extensive repair work is required.
  • Is your car getting up there in age? Since all vehicles naturally require more attention as they age, an extended warranty begins to make more sense for older and used vehicles, especially if the manufacturer’s warranties are expired. Extended warranties that offer routine maintenance services, for example, really help to keep repair costs low while giving the vehicle the work it needs to stay running for much longer than it would otherwise.
  • Do you want to pay for extra perks? Many extended car warranty providers don’t just stop with vehicle protection for some part 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 of time 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 all 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.

FAQs

Q. Do I need an extended warranty?

A. No vehicle needs an extended warranty, but you may find the extra coverage and perks can actually reduce repair costs if your vehicle requires frequent attention or maintenance.

Q. Can new cars have an extended warranty?

A. In most cases, yes. They tend to be less useful and may be overpriced, but most automakers do offer extended warranty options for new vehicles.

Q. Can I cancel an extended warranty?

A. It can be a hassle, but you can cancel a warranty in most cases. The best way to do this is to speak with someone at the dealership where you bought your car to get the details of the cancellation process.

Final Thoughts

Extended warranties aren’t necessarily for every vehicle and car owner. Instead, they make sense when you actually need some frequent work done on your vehicle and when you can save money on service costs. The ability to enjoy extra perks may also warrant the cost of a vehicle service contract.

The only way to know the true cost of an extended warranty is through research. After you have some basic quotes from different warranty companies, think about how much maintenance your vehicle needs on average. This is a better way to think about an extended warranty than just being covered for unexpected issues. 

You can even research or track the costs of average automotive service work when you pay out-of-pocket. If the numbers add up, an extended warranty can be perfect.

More Information

Here are a few more resources you can use to find out about extended warranties:

Get More Protection with Endurance

Get $350 off an Endurance warranty plan with coupon code: DRIVE350

You don’t have to rely on the automaker to give you vehicle coverage that actually saves you money. In fact, most factory extended warranties fall short of customer expectations. When you think your vehicle is covered for an unexpected repair or needed service, you will likely find the factory warranty falls short. 

A plan with Endurance, on the other hand, is much more comprehensive since it actually covers things beyond factory defects and flaws. So, if you want real coverage, it’s time to check out Endurance.

Get a free quote from Endurance today or call: 1-855-632-3655.