Why so many extended car warranties are scams

Extended warranties have always been a cash grab. Even more so than private Insurance which is mostly a ripoff unless you like changing policies like underwear and going to court to make a claim

If common law would be applied to them or if we would fix our broken legal framework they would likely mostly disappear.

That said the automotive manufacturers themselves can provide warranties that at least pay for things even if expensive.

The mindset since the 70’s by “businessmen “ is to take them for everything they got, only thing that stops them is if a legal framework exists.

This is the same reason we will keep having bank bailouts and crashes until Glass Segal is reinstated, on their honor doesn’t work.

 

Like Robert Riech is always talking about . The not so good powers have tried to kill off alot of protections in our systems. Glass Stegal was one.

 

There's always like one person who says, I saved big money with my extended warranty... But just one person lucking out does not a wise investment make.

 

I think extended warranty are good for cars and trucks that will tow excess weight or severe off roading.

If you get plan not to do any of the above, then get it professionally inspected prior to buying and forget the extended warranty. The total lifetime average car’s repairs won’t exceed entire extended warranty payment.

 

Usually the extended warranties I’ve seen will say you can repair the car anywhere but they don’t pay the full bill unless it’s a preferred location.

Add to this you usually need to have a dealer do the oil changes every 3000 miles / twice a year, cabin filter twice a year, transmission/radiator/brake every 25,000 and you have to have paid tire rotations 4 times a year.

So long as you do all this, keep documentation, don’t have any accidents or even speeding tickets in some cases and don’t miss anything on the “warranty” schedule they will typically cover whatever is spelled out in their 10 mile legal bs.

If your the weirdo that pays the dealer to do tons of unnecessary work it is possible to get the warranty to cover things, but even then they might fight

 

Manufacturer's extended warranties are the only ones worth considering. Discounting the value argument, if Honda or Toyota sold the warranty the dealer will honor it just like a failure in the original 3 year 36k warranty.

An excellent value proposition is a manufacturer's extended warranty on a central ac system. Almost guaranteed to payoff.

The manufacturer's warranties can be negotiated. A car version is usually marked up 100-150%. Same goes for ac warranties which cost $400 but sell for $1200 or more.