Auto Warranty Facts

CarShield explains the differences between auto warranty plans and vehicle service contracts, and how to pick the one that's right for you.

Auto Warranty vs Vehicle Service Contract: What’s the Difference?

If your vehicle is nearing the end of its factory auto warranty, you may find yourself looking for a way to keep the vehicle covered against the ominous threat of repair costs. If that’s the case, then you have options, but the trouble is figuring out how to make the right decision for your needs, and your budget. Everyone knows that if something breaks in their car, it suspiciously tends to happen right after the car is outside of its factory warranty. When that happens, you find yourself on the hook to cover repair costs. For some it could be the difference between driving to work, or taking the bus until their vehicle repairs can be afforded. With that much to worry about, it’s important to figure out the best steps to take in deciding between an extended auto warranty and a vehicle service contract. Let’s navigate those decisions below.

What is an Auto Warranty?

An auto warranty comes directly from the vehicle manufacturer and can mean several different things. Though extended car warranties differ in longevity, they commonly range from three to five years in length. They also offer a limited amount of mileage applied to them. That is typically 60k-100k total miles on the car. While it’s most common for a dealership to sell an extended warranty as “bumper to bumper” coverage, it’s also possible that they could be offering less coverage that only covers powertrain components. This is especially true for used vehicles. Auto warranties are seldomly available on vehicles outside of the factory warranty. Carefully review your paperwork if you have an extended auto warranty to see exactly how long it is good for, what type of coverage you purchased, as well as any exclusions on the coverage. It is important to note many after-market modifications can void a car’s warranty, so be mindful of those if you purchased a used car with modifications or plan on making some yourself.

What is a Vehicle Service Contract?

A Vehicle Service Contract is very similar to an extended car warranty. In fact, many people confuse the two, yet there are key differences. A Vehicle Service Contract is purchased from a dealership or an outside company, and is not provided by the auto manufacturer. Most Vehicle Service Contracts offer three to seven years of coverage from the time of purchase. Vehicle service contracts generally offer longer coverage than an extended car warranty provides. There are also various mileage plans available, some covering up to 200,000 miles or beyond. Vehicle Service Contracts, like extended warranties, can vary in coverage. Check your contract if you have a Vehicle Service Contract to see exactly how long it is good for, what type of coverage you purchased, as well as any exclusions on the coverage.

What is the difference between an extended car warranty and a Vehicle Service Contract?

For most consumers, there is not a lot of difference between the two. Ordinarily, as the vehicle ages, the less coverage a Vehicle Service Contract will offer. In contrast, with an extended warranty, many dealerships will not offer extended warranties at all on vehicles outside the factory warranty. Costs on both plans vary based on the vehicle and the type of coverage, or length of coverage being offered. Both plans are accepted at dealerships, though an extended warranty can usually only be used at a dealership from the same manufacturer. Vehicle Service Contracts can generally be used at any dealership or ASE certified repair facility.

Auto Warranty Benefits

Benefits of a Vehicle Service Contract with CarShield

Freedom of choice in which repair shop to use. Take it to your local dealership or your local ASE Certified mechanic.

Variety in part selection. You aren’t limited to using only the manufacturer’s parts, which are often more expensive than other parts brands.

A broader range of protection plan options. CarShield offers several coverage levels with many affordable plans at each level instead of limited extended auto warranty coverage levels from the manufacturer. You’ll be able to find a more customizable plan for protecting your vehicle. Price. CarShield offers affordable prices on Vehicle Service Contracts with extensive coverage.

CarShield could save you thousands in potential car repairs.

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Since having CarShield, Bill has had 2 claims on his Ford F250 to save over $2,000 in repairs.
Since having CarShield, Bill has had 2 claims on his Ford F250 to save over $2,000 in repairs.

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