When you purchase a new car from the dealership, it will include an auto warranty designed to guarantee vehicles are free from defects in material or workmanship. However, most new car coverage typically expires after three years, which is when an extended auto warranty comes into play.
But are extended car warranties a good investment? Despite what a dealership salesperson may tell you, the extra coverage may not be necessary for every driver. In this article, we’ll discuss what an auto warranty is, how much it may cost, and different plans offered by the best extended car warranty companies. This way, you can decide whether extended protection is right for you.
Start comparing free, personalized quotes from our top recommended providers right away by clicking below.
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Is an Extended Auto Warranty Worth It?
If you can’t afford to put away money for unexpected vehicle repairs, an extended auto warranty is a way to finance repairs over a long period of time, as most providers offer financing terms that extend for a year or longer.
Additionally, if you’re one of the unlucky drivers who end up needing a major, expensive repair, your warranty can pay for itself and then some. Purchasing an extended warranty can be a guarantee that you will not need to invest more than the cost of your contract into your vehicle’s potential mechanical problems. Many drivers purchase coverage for the peace of mind alone.
Extended warranty providers carefully calculate the costs of their products, tailoring prices to each customer’s vehicle. Like insurance agencies, to make money, warranty companies need to pay out less in claims than they collect in sales. For this reason, it is unlikely that an extended auto warranty’s cost will exceed the cost of covered repairs for every driver.
In the long run, it may be a good idea to save the money you would spend on an extended warranty and pay for repairs as they arise. Every extended warranty contract includes exceptions, and not every breakdown will be covered. Saving for repairs yourself also means that you do not need authorization before repairs can begin, but it does mean that you’ll need the self-discipline not to dip into your emergency car savings fund—and you’ll need to be able to save a few thousand dollars.
What Is an Auto Warranty?
An auto warranty is a contract that pays for the cost of parts and labor to repair certain vehicle components should they break down or malfunction. Every auto warranty will either list the parts that are covered (called inclusionary or stated-component contracts) or list the parts that are specifically not covered (called exclusionary or bumper-to-bumper contracts).
When a warranty holder’s vehicle breaks down, the driver brings their vehicle to an approved repair shop or dealership for a diagnosis. The mechanic contacts the auto warranty administrator with a teardown report. If a claim is approved, warranty administrators typically pay the repair facility directly, minus a deductible you agree on when you sign your contract.
Manufacturer auto warranties are provided for free with new vehicles. These new car warranties tend to be comprehensive but only last for 3 years or 36,000 miles (whichever comes first) on average. Powertrain components such as the vehicle’s engine, transmission, and transfer case are covered for longer (typically 5 years or 60,000 miles).
You can get coverage through your vehicle manufacturer or through an independent warranty company to protect your finances after your factory warranty expires. Although these are called warranties, they’re really vehicle service contracts, also called vehicle protection plans. These contracts are similar to warranties, though they are not usually as comprehensive as manufacturer new vehicle warranties.
What Does an Auto Warranty Cover?
An auto warranty will cover the cost to repair or replace any car parts listed in your warranty contract. Exclusionary warranty contracts pay to repair or replace any car parts not specifically excluded by the warranty contract.
What Doesn’t an Auto Warranty Cover?
Auto warranties only cover parts that break down as the result of normal use. They do not cover damage caused by an accident, theft, vandalism, or act of nature. Warranty contracts also typically require car owners to maintain their vehicles according to the factory-recommended maintenance schedule at the owner’s expense.
Several car parts are almost always excluded, even from the highest levels of coverage. These are:
- Wiper blades
- Interior upholstery
- Exterior trim
- Bulbs and fuses
- Brake pads and shoes
How Much Does an Extended Auto Warranty Cost?
The price of an extended auto warranty depends on your vehicle make, model, age, and mileage. Prices also vary depending on the level and length of coverage, as well as the deductible you choose. Even the city you drive in can impact the cost of an extended auto warranty.
As part of our independent research process, our review team has reached out to many extended auto warranty providers for quotes on low-level, mid-level, and high-level coverage plans. We found that the average extended auto warranty can cost anywhere from $3,000 to $4,000 to cover your vehicle for five to seven years.
The chart below shows some of the quotes we received for a 2017 Ford Explorer with 45,000 miles on the odometer. The contracts below are exclusionary, high-tier coverage that include most vehicle components. Your own quotes may vary, but this chart should give you some idea as to the cost of an extended auto warranty.
|Provider||Endurance||CARCHEX||CarShield||Protect My Car||autopom!|
|Coverage Term||3 years/
|Month-to-month coverage||4 years/
for 18 months
for 18 months
for 48 months
for 24 months
|Down Payment||$178.10||First month’s payment||First month’s payment||$99.00||First month’s payment|
5 Best Extended Auto Warranty Providers
After researching providers’ costs, coverage options, customer reviews, industry reputation, and more, our review team ranked the industry’s best extended car warranty providers. The companies shown in the chart below are the five highest-scoring providers in the industry, based on these standards.
|Provider||Our Score||Levels of Coverage||Highest Coverage Limit|
|1. Endurance||4.9 out of 5.0||6||200,000+ miles|
|2. CARCHEX||4.8 out of 5.0||5||250,000 miles|
|3. CarShield||4.6 out of 5.0||6||200,000 miles|
|4. Protect My Car||4.5 out of 5.0||3||125,000 miles|
|5. autopom!||4.5 out of 5.0||4||150,000 miles|
The best way to find the right coverage for your needs is to compare costs and companies for yourself. Continue reading to learn more about and get quotes from each of our recommended providers.
#1 Endurance: Best Coverage
Endurance has been in business since 2006 and is available in every state with the exception of California. The company is a direct provider, meaning it administers its own contracts and there’s no middleman to slow down the claims process. Because Endurance is backed by an AM Best A-rated insurance company, you know it has the financial background to meet customer claims obligations.
There are six levels of auto warranty contracts offered by Endurance. These include:
- Supreme: This is Endurance’s bumper-to-bumper exclusionary warranty, which covers almost all vehicle components. Some examples of excluded items are light bulbs and LED lights, batteries, high-tech items, safety restraint systems, glass, and cosmetic vehicle defects.
- Superior: This plan provides coverage for hundreds of specific components and includes nearly everything covered by the Supreme plan, except for gaskets.
- Secure Plus: This tier covers the powertrain, steering components, electrical systems, and brakes.
- Secure: The most affordable Endurance auto warranty, the Secure plan focuses solely on the most vital and expensive parts to replace in your vehicle, including the engine, transmission, and turbo/supercharger.
- Select Premier: This plan focuses on protecting a vehicle’s powertrain and is a good choice for high-mileage vehicles.
- EnduranceAdvantageTM: This plan combines breakdown coverage with coverage for routine maintenance services like oil changes. There are three levels of contracts to choose from within this plan.
Endurance auto warranty plans come with some of the most comprehensive benefits in the industry. Along with roadside assistance, trip interruption coverage, and rental car coverage for the duration of your contract, drivers get a renewable year of enrollment into the Endurance Elite Membership program. This offers benefits like identity theft protection, free key fob and tire replacements, and more.
To learn more about Endurance, read our Endurance auto warranty review. You can also get a free quote by clicking below.
Endurance is our pick for best coverage with its comprehensive warranty options.
#2 CARCHEX: Best Service
CARCHEX is one of the oldest extended auto warranty providers, having sold contracts for over 20 years. CARCHEX contracts are available in all 50 states. One thing that makes CARCHEX stand out is its long list of industry partnerships, which includes companies such as Kelley Blue Book, Edmunds.com, CARFAX, and RepairPal.
CARCHEX offers five levels of coverage:
- Titanium: The highest level of coverage available, similar to a bumper-to-bumper warranty.
- Platinum: This plan covers hundreds of specific components from all major systems of your vehicle.
- Gold: Gold-level coverage includes many components from all major systems of your vehicle.
- Silver: The Silver plan covers repairs to the essential systems of your vehicle, such as the powertrain.
- Bronze: This plan was designed to protect you from the most common and expensive repairs to the engine and transmission.
Based on our own experience getting quotes from CARCHEX, as well as its positive customer reviews and strong industry reputation, we’ve designated CARCHEX as having the industry’s best service. CARCHEX is accredited and holds an A+ rating from the Better Business Bureau (BBB).
To learn more, check out our CARCHEX warranty review. You can also click below for a free, personalized CARCHEX quote.
Our research found this provider to offer the industry’s best service.
#3 CarShield: Best Value
CarShield has been in business since 2005. The company offers extended auto warranties in every state except for California, and it’s one of the only top-rated providers that offers auto warranty coverage as well as specialty coverage for motorcycles and ATVs.
CarShield contract options include:
- Diamond: CarShield’s most comprehensive plan, the Diamond plan covers everything from fuel pump breakdowns to starter problems to transmission failure.
- Platinum: This plan covers parts of your vehicle’s engine, transmission, air conditioning, electrical system, and more.
- Gold: In addition to covering common powertrain items such as the engine and transmission, this plan covers the alternator, power window system, and more.
- Silver: CarShield’s most affordable extended warranty plan, the Silver plan focuses on the most important parts of the vehicle’s powertrain. These include the transmission, water pump, and drive axle.
- Aluminum: This tier covers most computer-related problems and electrical problems in your vehicle, including the engine control module, starter, alternator, and more.
CarShield plans offer some of the lowest monthly payment options, as well as low-cost contracts for Gold-level coverage. You can read our CarShield review for more information and see how much a CarShield contract would cost for your vehicle by clicking below.
Our research found this provider to be the most affordable. Plus, it offers monthly plans.
#4 Protect My Car: Best Financing
Protect My Car extended auto warranties can be purchased in every state except for Arkansas, California, Hawaii, Missouri, Oklahoma, and Washington. The company has been around for over 15 years and has grown into one of the most popular extended auto warranty providers in the country.
Protect My Car offers three levels of extended auto warranty coverage:
- Supreme: This is an exclusionary plan that covers most vehicle components and high-tech systems, with some exceptions. Coverage for the navigation system can also be included with the Supreme plan as an add-on.
- Select: This tier covers the engine, transmission, transfer case, drive axle, differential assembly, cooling system, air conditioning, electrical components, timing chain, suspension, and select brake system components.
- Driveline: This tier covers powertrain components along with other vital systems. It includes the engine, transmission, transfer case, drive axle, differential assembly, cooling system, air conditioning, electrical components, and timing chain.
To read more about this provider, check out our comprehensive Protect My Car review. You can also click below for a free, no-obligation quote.
#5 autopom!: Best Customer Experience
Autopom! is a relatively young extended warranty provider, having been in the business for only about 10 years. It offers vehicle service contracts for drivers in every state except for California, where it sells mechanical breakdown insurance instead.
Autopom! boasts some of the best customer reviews of any provider in the industry. It has an A+ rating from the BBB and a 4.8 out of 5.0 “Excellent” rating on Trustpilot.
There are four auto warranty coverage options offered by autopom!:
- Exclusionary: This coverage plan includes nearly all mechanical and electrical vehicle components.
- High-Level: The High-Level plan covers most major systems, including the engine, transmission, transfer case, drive axle, steering, electrical, air conditioning, braking, cooling, and fuel system.
- Mid-Level: This covers powertrain components as well as select steering and braking system parts.
- Powertrain-Plus: This plan protects your car’s major systems, including the engine, transmission, transfer case, drive axle, differential assembly, air conditioning, and basic electrical components.
Learn more about this provider by reading our autopom! review and click below to reach out for a free autopom! quote.