New York — Whether you are a car enthusiast, a new driver, or simply a person wanting to get from A to B, making sure your car is in excellent working condition should be a top priority. Cars have engines that may suffer a mechanical failure. These costs can be heavy on the budget, especially unforeseen major repairs. An extended car warranty is there for the purpose of easier budgeting and peace of mind that you are covered in the event of a mechanical breakdown. Here we will talk about extended car warranties, vehicle service contracts, and digitization of warranty solutions to better understand the full market offering.
Is Digitization of Car Warranties a Good Idea in Today’s Digital Climate?
We will go through the benefits of getting auto protection through an online marketplace, however there is still a looming question about digitization overall. Are we witnessing the second .com crash?
Sure, we may be witnessing a serious downturn, but at the same time a healthy correction is well underway. As Chaiz puts it: “…exacerbated trends in financial markets are not a new phenomena. Fundamentally, we still see trillions waiting to be extracted through the digitization of industries – like ours.”
Digitization simplifies the process and provides the perfect scenario where both the business and the customer will be able to save. It has also become evident that the majority of people prefer digital services. Through surveys in Europe, China, and the USA by DEKRA and Ipsos found that around 71% of people preferred using a digital service to buy and sell used vehicles, while only 27% felt they preferred in-person contact. Around 78% of Americans do online research before purchasing a used vehicle. There is no reason to assume that this would not be the same for extended car warranties and vehicle service contracts. Given the option for a digital approach versus a phone call will likely be compelling for most, there may be quick adoption.
What Is An Extended Warranty?
An extended warranty is offered by the car manufacturer. It is a way of extending the factory warranty the vehicle received upon original purchase of the vehicle. Mostly the powertrain or bumper-to-bumper warranty plans are extended and not any optional coverage items from the original purchase. Often these extended car warranties need to be purchased at the time of original purchase of the vehicle and can cost anywhere from $1,500 to $4,000. Certain manufacturers do offer used vehicle warranties for vehicles with a full history, often referred to as certified pre-owned vehicles. Sometimes these warranties come with roadside assistance, though often quite limited.
A vehicle service contract is typically a better choice for extended auto protection, most notably for pre-owned vehicles or older models. Often referred to as extended car warranties, they are actually vehicle service contracts which are offered by third party providers. Chaiz.com compares these third party offerings for you, so you can choose the plan and price that is best for you.
What are Extended Car Warranty Terms?
Extended warranties and vehicle service contracts are offered for a selected number of years and mileage. For example, if you have a warranty plan that has a 3 year/36,000 mile warranty then you will have a warranty in place for 3 years or 36,000 miles, whichever comes first.
Why Should You Opt For An Extended Car Warranty Online?
Save significantly on repairs
If you suffer a mechanical failure it could cost hundreds, if not thousands, of dollars to repair. Paying a repair bill out of pocket is not always possible. You might also have other costs such as towing the vehicle to the auto repair shop. Most of these repairs could be covered by an extended warranty or a vehicle service contract.
Extended car warranty costs are often not made public, though you can find a good deal of information on fan forums and automotive websites. To get an accurate number you will need to contact your vehicle manufacturer to find out if they have any options and what those options might be for your model car. Though, according to some forums, costs can vary greatly depending on the vehicle and warranty plan, an average of $2,500 (total price), and up to $7,000 for high end models, can be expected for most popular models.
Vehicle service contracts are most often priced similarly. However, an online marketplace such as Chaiz offers coverage at affordable rates. For example, for a 2016 compact SUV vehicle you will be looking at between $39 and $50 per month for the most comprehensive coverage, including roadside assistance services. Keep in mind that year of the car, make, model, and mileage will affect the end price. It is still well within anyone’s means and provides the driver with peace of mind that you are totally covered in the event of a mechanical breakdown.
An online marketplace gives the buyer an opportunity to compare prices from the industry’s leading vehicle protection providers and find the coverage that’s right for them. The added benefits are definitely a perk with the vehicle service contract or extended car warranty as you will have access to a number of roadside assistance services that make experiencing car breakdown a little more bearable.
There are currently 200-300 vehicle service contract providers – making it a market that is filled with overwhelming information which takes ages to comb through, phone call by phone call, to find the best coverage. An online comparison marketplace reduces that time and takes away the need for tedious phone calls. You will be able to view multiple quotes based on your vehicle and yearly driving needs within minutes. No need to waste time going to different websites and trying to compare plans apples to apples.
Do You Need an Extended Car Warranty?
If you are unsure about whether or not you are under warranty, fear not. It is quite simple to find out. Get your VIN (vehicle identification number) and write down your odometer reading. The plans cover all major parts of the vehicle that fall under the powertrain. This includes the transmission, engine, transfer case, and so on. The parts that make sure the wheels keep turning. More comprehensive plans cover more components. With this information you can contact your local vehicle manufacturer dealership to find out if you are still under warranty. If not you can consider the options the manufacturer has available for you.
Alternatively, opt for an easy-to-use online platform that allows customers to compare products, prices and features across multiple providers at their own pace. A comparison site such as Chaiz has all you need to know right at your fingertips, plus you can save up to 60% versus call centers and car dealerships.