When you’re purchasing your first car, sometimes the idea of freedom at your fingertips can overtake the more ‘adult’ tasks, like paperwork. Specifically deciding whether a warranty or an extended one is necessary for you.
You may have heard the term thrown around on TV or even on social media as a sound stuck in your head, but the concept of a car warranty can be quite confusing. Hopefully the breakdown below of what a warranty is, the different types you can find, how much they can cost and what the difference between that and car insurance can help.
What Is A Warranty?
In the case of car ownership, a warranty is an agreement between the manufacturer and you, the car owner, that the product bought will be held up to a set standard of both quality and functionality. Typically, these types of agreements are viable for a set time frame or a predetermined amount of miles from the time of purchase. If the car isn’t up to code, or something were to happen within the warranty period, then the dealer is legally responsible for replacing or repairing the parts or refunding you the amount you paid.
The Different Types Of Warranties
There are a few types of car warranties that can cause some confusion when you research them, and we’ve broken them down below.
In Western Australia, a statutory warranty can only be applied to a used car that has been bought directly from a licensed dealer. To qualify for such an agreement, the car needs to cost you at least AU$4000 and has to meet certain age and distance requirements. Every licensed dealer is required, by law, to provide this on every car they sell as it protects you, the buyer, should anything happen. At point of sale, they should provide you with paperwork that clearly indicates what the warranty covers.
Usually, they cover faulty products that are linked to safety – airbags, brakes, substantial structural rust etc., or engine defects.
However, they do not cover defects that arise because of the misuse of the car or in an accident. Be sure to shop around when looking for a vehicle because different dealerships have different levels of cover for their used cars.
This is the original manufacturer upholding a promise about what they will do if anything happens with their recently bought new cars. They don’t alter your statutory warranty and usually cover the cost of repairing your car and all manufacturer-fitted accessories if they have any defects within a time frame after purchase.
Different brands have a variety of claims, but typically they can range from three years, or 100,000kms, or up to seven years with unlimited mileage.
One thing to note is that should you sell your used car on, whilst it’s still under its manufacturer’s warranty, then it will transfer over to the new owner.
For an additional cost, an extended warranty adds a certain amount of kilometer’s or years on to the original agreement to provide extra coverage, much like an insurance policy.
Extended warranty coverage is a little tricky to navigate and should be something you take into serious consideration. As you decide, take into account the following things, such as the exact service requirements – what products need to be used, how often and where it needs to be serviced – and what the warranty does not cover as each policy differs to the car and dealer.
In the end, research is your friend. Shop around and see if the warranty you want is worth the money that you are going to spend.
How Much Is An Extended Warranty On A Used Car
Now, that you know what exactly an extended warranty is, here is how you work out how much it will cost you.
The extended warranty cost is based on a few factors – the length of time you want the vehicle covered, the type of vehicle you have, and the deductible – what you’ll pay out of pocket before it kicks in. The longer you want your car to be covered for will mean a more expensive warranty cost.
There are calculators online to work out a rough estimate of the warranty cost, to have in mind when you call providers for a quote and what their warranties entail. Keep a list of who you call and what they offer and the choice is up to you.
Car Insurance vs Extended Warranty
Whilst both provide protection for your car, they do different things. Car insurance can help take care of your vehicle in the result of a crash or something else out of your control, like it being stolen or destroyed in a natural disaster.
Unlike warranties, however, car insurance has a variety of coverage packages that you can choose from. From comprehensive – which covers everything bar the liability of the injury or death of others; third party fire and theft, and third party property damage to compulsory third party insurance. Each has a different focus, and each can have additional extras – roadside assist, personal effects, windscreen cover to name a few- when it comes to selecting the right fit for you.
To find out what works, do your research, ask for quotes and then come to the conclusion that fits your case the best.
Get In Touch
When you’re ready to move on to your next car but want a nice starting budget, where warranties and insurance will be a breeze, get in touch because we want your car. Let us know what the model, make and year of your car is and we’ll come out and give you a quote to start you right with same day transactions.