What is a Vehicle Service Contract?

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Research & Savings

Vehicle Service Contract available for Ford F150.
Caleb White via Unsplash

CarShield explains what a Vehicle Service Contract is and why you need one.

According to Car and Driver.com, the average age of cars on the road today is nearly 12 years old. That means that most drivers are no longer protected by their car’s original manufacturer’s warranty..

If you are driving a car that is out of its factory warranty period you might be looking at expensive auto repair bills at some point in the future.

This probably has you looking for options to safeguard you and your wallet from those costs. If that’s the case then you’ve probably heard about Vehicle Service Contracts, but you may be wondering what they are.

Don’t worry, CarShield is here to help. In this comprehensive post we will cover the following:

  • What is a vehicle service contract?
  • Doesn’t my regular insurance cover that?
  • But what if my car already has a warranty?
  • Isn’t that just an Extended Auto Warranty?
  • What does a Vehicle Service Contract cover?
  • How much does a Vehicle Service Contract cost?
  • When should I buy a Vehicle Service Contract?
  • Where can I purchase a Vehicle Service Contract?
  • What is a Vehicle Service Contract?

    A vehicle service contract is an option that protects consumers from paying for the repair costs of certain mechanical breakdowns on their vehicle once the manufacturer’s warranty expires.

    Doesn’t my regular car insurance cover that?

    While many people feel that they are adequately protected by their car insurance, which nearly all states require to license a vehicle, it does not protect consumers in all situations.

    Allstate explains that car insurance covers against damage to the car from accidents, fire, etc., but it will not protect drivers from the cost of repairing or replacing parts on their vehicle that have suffered damage from mechanical failure.

    But what if my car already has a warranty?

    This is a great question. It’s very common to see a car commercial and hear about the warranty that covers the vehicle in case something happens. The best commercials boast “10 years and 100,000 miles!”

    It’s true that all new cars are required to include a manufacturer warranty to safeguard the vehicle in case parts break or wear out too soon.

    However, those warranties do have limits and often are diminished in length if the vehicle changes owners.

    Edmunds has an extensive breakdown of the most popular car manufacturers and the warranties that they provide.

    After reading, it’s clear that not all manufacturers' warranties are created equal and your vehicle may not have the protection that you thought it did.

    Isn’t it just an Extended Auto Warranty?

    It’s pretty common to hear the phrase “Extended Warranty” used interchangeably with “Vehicle Service Contract”. However, there is a key difference between the two that consumers should be aware of when looking to purchase vehicle protection.

    An Extended Warranty is often sold by the manufacturer or at the dealership, most commonly for used vehicles. It is an extension on the original warranty, hence the name, that must be purchased within a specified period of time or amount of mileage.

    A Vehicle Service Contract is sold by a third party, has its own eligibility guidelines, and can be tailored to fit a consumer's needs and budget.

    For an in-depth look at the differences between Vehicle Service Contracts and Extended Warranties check out our informative post here.

    What does a Vehicle Service Contract cover?

    A vehicle service contract covers a vast number of components on a motor vehicle. Essentially anything that is covered by a manufacturer’s warranty can be covered by a Vehicle Service Contract.

    It’s most common for a Vehicle Service contract to protect major parts of the vehicle’s powertrain such as the:

  • Engine
  • Transmission
  • Driveshaft
  • Drive Axle
  • That’s not all. Vehicle Service Contracts may also cover much more of a car, including high-tech components like navigation systems, power steering, and even the power window motors.

    The best Vehicle Service Contracts are nearly identical to the original manufacturer's warranty.

    “Wear and Tear” items are generally not covered.

    Things that routinely wear out like tires brake pads, clutches, and windshield wiper blades are not covered under Vehicle Service Contracts. This isn’t unusual as those types of things are never covered, even by the manufacturer’s warranty. You should also see the contract’s list of exclusions for further information.

    How much does a Vehicle Service Contract cost?

    Vehicle Service Contracts vary in price depending on a multitude of factors such as:

  • Age of the vehicle
  • How many miles are on the vehicle
  • Vehicle make & model
  • How the vehicle is used
  • The state you reside in
  • Modifications to the vehicle
  • Commercial or Rideshare usage
  • All of these things determine how much a Vehicle Service Contract will cost to cover a specific vehicle.

    Generally, a newer vehicle with fewer miles will have the lowest cost with a higher level of protection. However, an older vehicle with higher mileage can still qualify for a Vehicle Service Contract that has a great level of protection and a budget-friendly price.

    When should you buy a Vehicle Service Contract?

    The ideal time to purchase a Vehicle Service Contract is before the manufacturer’s warranty expires.

    By doing so, consumers ensure that they are protected from many car repair costs and never experience a lapse in coverage that could leave them vulnerable to expensive repairs.

    Also, while the vehicle is still relatively new and has lower miles, they will get the best possible level of coverage from their Vehicle Service Contract at an affordable price.

    It’s a win-win.

    Where can you buy a Vehicle Service Contract?

    Consumers have many options when it comes to selecting a Vehicle Service Contract.

    Fortunately, America's #1 auto protection company has made purchasing a Vehicle Service Contract simple, affordable, and convenient.

    Many providers offer Vehicle Service Contracts with terms based on years and mileage. For example, a typical contract may be for 3 years or 36,000 miles.

    CarShield offers Vehicle Service Contracts with unique terms. This is because CarShield provides consumers with a month-to-month option.

    A month-to-month Vehicle Service Contract from CarShield is essentially unlimited in time or mileage. The contract renews every month and that means you get the same level of coverage for as long a you want to keep the vehicle protected.

    To take advantage of this opportunity, simply go to CarShield.com. Enter a few quick details about your vehicle and a specialist will help find the right option for you, your vehicle, and your budget.

    Now that you know what a Vehicle Service Contract is, you have all the information you need to decide if one is right for you.

      Published By  
    Brandon Evans
    Senior Editor at CarShield

    Brandon Evans is the senior editor at CarShield. He has been published across multiple industries with work featured in MaxSTL and the VITAL Voice. He holds a B. A. in Creative Writing from Lindenwood University. He writes out of Saint Louis, Missouri.

    CarShield customer, Esekiez, used his vehicle protection to fix his broken power windows at his Nissan dealer.
    CarShield customer, Esekiez, used his vehicle protection to fix his broken power windows at his Nissan dealer.

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