Car warranty FAQ

What is car warranty? What does it cover, do you need it, and where can you get it – we answer all the common questions.

Jim Kersey Last updated on 16 April 2020.

What is a car warranty plan?

Car warranty is designed to cover the cost of any unforeseen damage or repairs to your car. It’s not to be confused with car insurance which is designed to offer financial protection for the costs associated with accidents, collisions, fire and theft. Warranty plans cover a slightly different area and are designed to provide financial support for the general upkeep of the car, as well as mechanical repairs.

Does car insurance offer the same coverage as a car warranty plan?

Car insurance and car warranties are similar in that they offer financial protection for problems and accidents that may occur in connection with car ownership – but they are not the same.

If you have a fully comprehensive car insurance plan, it may cover some of the features on offer with a car warranty plan. If you have third party only or third party fire and theft, it’s unlikely that any of the features of a car warranty plan will be included in your insurance package.

You will need to check the details of specific products to see if there is any overlap in the protection offered.

How much does a car warranty cost?

The cost of a car warranty varies and is contingent upon the vehicle itself, your personal circumstances, the type of plan you selected, and the provider you’re buying from.

Here are some of the common factors that tend to push up the price.

  • If you use your car on a regular basis, your car warranty will likely cost more as you’re at a greater risk of requiring repairs and maintenance due to the increased mileage and time on the road.
  • Similarly, it tends to be more expensive to buy a car warranty for a luxury vehicle because the cost of repairs and maintenance is correspondingly higher for these models.
  • Cars that have a high mileage on the clock are also likely to demand higher charges for a warranty due to the perceived increased risk of mechanical issues.

How long does a car warranty plan last?

Car warranties are available for various periods of time but when shopping around you will find that most plans offer coverage for between one and five years.

There is a second factor to consider when asking ‘how long does a car warranty plan last?’ – and that is mileage. Warranties will often include a mileage limit instead of, or as well as a time limit. Once the vehicle has done more than the agreed number of miles, the warranty will cease to provide financial coverage for repairs and damage.

What is included in a car warranty plan?

Car warranty plans generally cover the following features on your car:

  • Electronics
  • Brake parts
  • Engine
  • Gearbox

These are just a selection of the basic components you will find mentioned on most plans, what your specific car warranty covers depends on what your provider is offering, so check the small print before you commit.

How much will my car warranty provider pay out for a repair?

The amount of financial coverage your car warranty will provide in the case of repairs or maintenance differs by provider. You should identify what the pre-agreed criteria and limits are and ensure that they suit your requirements before you purchase the car warranty.

Among the things to look out for is the maximum claim limit. You will only be entitled to financial assistance up to a certain limit, determined by your provider. Above this point and you will have to cover repair and maintenance costs yourself.

In addition to an overall claim limit, car warranties tend to put limits on certain types of maintenance or repair work. For example, you may have a £550 limit for support on electronics repairs and a limit of £1,000 for engine repairs. As with the overall maximum claim limit, the way these different budgets are divided will differ by provider, so you will need to check that your provider offers all the right details for you before selecting a car warranty plan.

What is not included in a car warranty?

The features on car warranty plans are broad and varied, and change from plan to plan and provider to provider. But there are a few features that you’re unlikely to find included on standard car warranty plans:

  • Oil leaks
  • Tyres and wheels
  • Exterior damage
  • Audio system damage

You may find these features on more comprehensive plans, but this will be entirely dependent on the individual provider.

Cars over a certain age will often be excluded from car warranty plans entirely. Cars over 10 to 12 years of age tend to be considered too high a claims risk to be economically viable for warranty providers to consider.

Remember as well that car warranties are not the same as car insurance and will not replace the legal requirement for a car insurance policy to be in place.

To find out exactly what is and is not included in a car warranty, you will need to check the details with your potential provider.

Will my car warranty cover wear and tear?

We raise this point because some car warranty providers specifically exclude damage caused by wear and tear. This means that if parts break down naturally over time, as opposed to breaking or encountering manufacturing faults, then your car warranty plan will not pay for the repairs.

Other plans will offer cover for any and all repairs, regardless of whether or not they were caused by wear and tear.

Increasingly, warranty contracts include detailed agreements about what constitutes wear and tear in the event of damage to protect both the driver and the warranty provider.

It’s important that you are aware what wear and tear coverage you are entitled to before signing your contract to ensure you have the financial support you expect.

About the author:

Jim brings together unique data insights, contextual knowledge and thought provoking themes, to shed new light on important issues affecting both UK businesses and individuals. Read more

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