An extended service plan can help protect your bank account after an auto breakdown. When your car needs major repairs, it almost certainly means you will be facing a hefty bill. But by the time you wish you had an extended service plan, you may no longer be eligible for coverage, so it’s a good idea to read up on your coverage options before it’s too late.
In this article, you can learn more about extended service plans and the best extended car warranty companies to decide whether you would benefit from extended protection. If you find that an extended car warranty is right for you, you can use the buttons below to compare quotes from our top-rated providers.
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What Does an Extended Service Plan Cover?
Extended service plans provide extra coverage for your vehicle after its factory warranty expires. You can purchase an extended service plan for new or used cars, trucks, SUVs, motorcycles, motorhomes, travel trailers, and RVs.
If your vehicle is new or certified pre-owned, you’ll most likely have the choice to purchase an extended service plan from your vehicle’s manufacturer, or you can go with a third-party warranty provider.
You might choose to purchase a plan from the manufacturer if your car is brand new, if you drive a luxury vehicle, or if you compare quotes and find you’ll get the best rates from your dealership. A plan from a third-party provider may be better if you want longer coverage limits, if you want to have your choice of repair shops, or if you can get a better price independent of a dealership.
Extended service plans protect your car for a certain number of years and mileage limits, and plans can cover hundreds of components and systems that are liable to generate hefty repair bills if they break down.
How Much Does an Extended Service Plan Cost?
The cost of an extended service plan can range from about $300 to $1,500 per year. That’s a wide range because extended service plan prices depend on your car’s make, model, age, and mileage, as well as your location.
Two of our top-rated extended service plan providers are Endurance and CARCHEX. In our research, we found Endurance to offer the best coverage on the market, and CARCHEX provides the best service to customers. We reached out to both for quotes for a 2017 Ford Explorer with 45,000 miles.
The most comprehensive Endurance extended service plan would cost about $1,060 per year, and the provider’s basic powertrain coverage would be $993. A CARCHEX warranty for the same vehicle would be about $730 per year for the most comprehensive coverage and between $597 and $684 per year for the lowest tier of coverage, depending on the mileage limit you choose.
However, the cost of an extended service plan can vary widely from vehicle to vehicle, so these quotes may be vastly different from the prices you’d pay for coverage. Some factors that will influence the price of your extended service plan include:
- The year, make, and model of your vehicle
- The number of miles on your odometer
- Where you buy your extended service plan
- Whether your car has high-tech components
- The level of coverage you choose
- The deductible you choose
Why Wouldn’t I Buy an Extended Service Plan?
The most common reasons American car owners don’t buy extended service plans include:
- Cost: Extended car warranties can be expensive.
- Probability of use: Many drivers don’t see the value in extended service plans until they break down and are facing expensive repairs, at which point it could be too late to purchase coverage.
- Vehicle ineligibility: Most extended manufacturer’s warranties are only available for cars at the point of purchase or before the factory warranty expires, so drivers don’t think they’re eligible for extended coverage. (However, this is not the case, as they may still be eligible for a third-party warranty.)
These reasons were identified in a 2018 survey conducted by Pegasystems, Inc. The study polled 1,000 American car buyers to measure consumer aftermarket buying habits and opinions, including those associated with extended service plans.
Even though only 37 percent of respondents owned an extended service plan, 60 percent reported seeing the value in extended coverage. What’s more, 62 percent of the respondents who did own a plan reported having benefited from their coverage in the past year.
How to Make an Extended Service Plan Worth It
You may be able to negotiate the price of your extended service plan, but in general, there aren’t many discounts available for coverage. In any case, here are a few tips to make your extended service plan more affordable:
- Consider third-party providers over dealership warranties: Prices from third-party providers are usually more affordable than extended service plans from a manufacturer.
- Compare quotes from multiple companies: Comparing quotes from dealerships and third-party vendors is the No. 1 way to know whether you’re getting the best rates for your extended service plan.
- Decide whether you want repairs to be made with genuine parts: If you don’t drive a luxury vehicle, sports car, or collector’s car, repairing your vehicle with genuine factory parts won’t give you significantly improved performance. A third-party provider will usually request repairs to be made with generic parts, which can lower your total costs.
- Consider when you’re planning to sell your vehicle: Buying a transferable extended service plan can increase the resale value of your car if you plan on selling it before your coverage expires.
- Avoid a lapse in coverage: To get the best deal on an extended service plan, purchase manufacturer coverage when you buy your car or buy a third-party warranty before your new vehicle limited warranty expires.
- Act quickly: If you didn’t buy an extended warranty when you purchased your car, consider adding on coverage sooner rather than later. The older your vehicle is and the more miles you’ve put on it, the more expensive it will be to protect.
- Weigh your financing options: A higher deductible will lower your monthly payments, but you’ll pay more out of pocket for each repair. Or, you can choose a lower deductible and higher monthly payments, which is smarter if you may not have cash on hand when your car breaks down.
Pros and Cons of Extended Service Plans
If you’re wondering whether an extended service plan is worth the cost, you should check the reliability ratings and costs of common repairs for your vehicle on a site like RepairPal.
To start, ask yourself whether you’d feel comfortable paying out of pocket for what RepairPal has deemed the most common vehicle repair costs:
- Fuel pump replacement: $713 to $1,040
- Air conditioning condenser replacement: $467 to $626
- Alternator replacement: $571 to $762
- Starter replacement: $428 to $606
- Brake line replacement: $147 to $187
- Spark plug replacement: $192 to $258
Knowing that your car could break down at any time, an extended service plan can give you peace of mind that you won’t be stranded if you need expensive repairs that you couldn’t afford otherwise.
However, there are some reasonable downsides to consider when deciding if an extended service plan is right for you. For example, you’ll need to add another bill into your monthly budget, you may never need all of the coverage you purchase, and even the most comprehensive extended service plans won’t cover all repairs, so you may still need to cover a few fixes on your own.
If you are confident in your car’s reliability and your personal financial situation, you might not need an extended car warranty. But if you have even a shadow of a doubt, an extended service plan could be right for you.
Top Recommendations for Extended Service Plans
When you’re searching for an extended service plan, it’s smart to seek out quotes from only the most reputable extended car warranty companies. Our review team has taken a look into every major provider in the industry to determine which can be trusted and which you should avoid.
Purchasing coverage from one of our top recommended extended service plan providers, like Endurance or CarShield, you can be sure you’re getting reliable, comprehensive coverage at a fair price.
Endurance: Best Coverage
Endurance offers the industry’s best extended service plans. The company has been in business for over a decade, has a great reputation, and offers five comprehensive plans ranging from basic powertrain coverage to an exclusionary bumper-to-bumper warranty.
Endurance plans come with the most extensive benefits on the market, including:
- 24/7 roadside assistance
- Key fob replacement
- Up to two tire repairs or replacements per year
- Identity theft protection
- $250 in vouchers to use with partner retailers
- Up to $5,000 in repair financing
Learn more in our in-depth Endurance warranty review, and get a free, personalized Endurance quote below.
Endurance is our pick for best direct provider with its comprehensive coverage options.
CarShield: Best Value
CarShield provides the best warranty coverage for drivers on a budget thanks to its low-cost, month-to-month contracts. The company has a great industry reputation, and customers have given many positive CarShield reviews on Google and TrustPilot.
CarShield offers five levels of extended car warranty protection and is one of the few extended warranty providers that has plans available for motorcycles and all-terrain vehicles.
Each CarShield extended service plan comes with the following benefits:
- Rental car reimbursement
- Roadside assistance
- Courtesy towing
To see what a CarShield extended service plan would cost for your vehicle, use the buttons below to get a free quote.