Car Insurance

No one can argue with the benefits of peace of mind. When something goes wrong with your car whether from heavy use or simply time, it can be comforting to know that a warranty stands between you and a huge service bill. But does an extended warranty really provide peace of mind and save you from hefty repair bills? The short answer is yes, and no.

To get the most from your extended warranty you must read the fine print and ask questions until you understand what you are getting, and what you can expect in the event of a claim. Some of these questions include:

1. Cost and timelines
How much is your extended warranty plan? What will it cover and for how long? Be sure that you know if there are mileage limits (such 50,000 or 100,000) so that you don’t take your car in at 110,000 miles only to learn it is no longer covered. The same applies with time limits. You don’t want to go in for service in the 13th month if your warranty expires in the sixth or twelfth month.

2. Coverage
What will your extended warranty cover? If there are limits you should be aware of these in advance so that you can adjust your plans accordingly. For example, some may opt against extended warranty plans that do not cover the vehicle against mechanical failure or moving parts such as ball joints.

3. Flexibility
What options are available to you in terms of service locations? What happens if you no longer need or want the warranty?

4. Claim expense
What happens if you need to use your warranty? Will you need to incur any out of pocket costs, and if so, how much? Some warranties allow for payment to be made to the vendor providing the service, which means you pay only your deductible. Others will reimburse you for allowable expenses; be sure to get some idea on the time within which you can expect to be reimbursed. In this instance it is important that you have a handle on your budget. Consider starting a repair fund to be used in the event that car service costs exceed your ready cash supply.

5. Deductible expense
How much will your deductible be, and what will be covered in that cost?

It can be very disappointing and stressful to learn that your warranty will not provide the coverage that you expect. Before you pull out the big guns be sure you fully understand the terms of your warranty, more accurately described as a service contact. If a thorough reading reveals that you have a right to services the provider has refused to provide you may have some recourse. Consider one or more of the following suggestions.

1. Be firm, but polite when stating your case. As you’ve no doubt heard kindness goes a long way, considerably farther than rudeness; or as the adage goes you will catch more flies with honey than you will with vinegar. Do not resort to rudeness or belittling when talking with the customer service representative, that will get you nowhere, fast.

2. Understand the chain of command. If you are unable to arrive at some level of satisfaction with the first customer service representative ask for a supervisor or manager. Be sure to keep a call log, which includes names and dates for all calls on the matter.

3. Direct calls and requests appropriately. Understand which responsibilities fall to the retailer and which fall to the manufacturer.

4. If calls get you nowhere, try a letter. It can be infinitely more difficult to ignore a clearly written letter delivered via certified mail with a return receipt. Make the process more efficient by delivering your letter to the right person at the right address. Be sure to include copies of any supportive documentation, a clear and reasonable request, and all relevant contact information. Don’t forget to keep a copy. Print a hard copy to hold onto in case you have computer trouble down the road.

5. Don’t overlook the media. Check first with the Better Business Bureau, if you are dealing with a warranty provider that has received a number of complaints your local newspaper or television station may be open to doing an investigative story.

6. Consult your warranty for written dispute resolution plans. These are often buried in the fine print and you are required to complete these steps before escalating your action plan.

7. Try contacting your local consumer protection agency, attorney general or insurance commissioner. If you are not sure where to look for contact information start in the blue pages of your telephone directory or the web page for your local government.

An extended warranty, or service contract, can help you manage the expense of car repairs and service in the event of failure. These warranties can be purchased directly from the dealer or from a third party. Many can be purchased online.

If you are considering an extended warranty give some thought in advance to your goals. Extended warranties can be helpful for many, but they are not practical or necessary for all. Consider the following:

1. Will your warranty include car rentals, roadside assistance or food and lodging? These can be important features if you travel a great deal and your car breaks down when you are away from home.

2. In some instances the extended warranty may not be necessary because it does not provide any additional coverage. You should check with the dealer to learn what warranties, if any, are included with the purchase price of the car. If the service contract you are considering duplicates the warranty (which comes with the car and is included in the purchase price) it probably won’t serve you.

3. Will your deductible cover each service incident regardless of the number of items or components to be repaired, or will you need to make a separate deductible payment for each?

4. Will your warranty provide for new parts or reconditioned, i.e. “like new” parts? If you will not be getting new parts find out what guarantee you will be offered with regard to dependability of the reconditioned part.

5. Will it be cheaper to cover repair costs as they arise? For plans with only basic coverage or that don’t cover normal wear and tear, you may find that the warranty is not always worth the price. If research shows your car to be reasonably dependable you may want to forgo warranty costs and save the money in an interest bearing account instead. Chose an account that offers you easy access to your money, without penalty, while paying attractive interest rates.

Well chosen extended service warranties can afford you peace of mind. Don’t undermine this tranquility with disorganized or poor record keeping or failure to ask the right questions. Following is a short primer to help you keep the details together.

1. Resolve to keep impeccable records.
Many extended warranties carry service requirements. Don’t invalidate yours with poor or lacking records. If you don’t already have a central location for your important papers take a few moments and create one now. It need not be fancy; your system could be as simple as a large envelope stored in a drawer, an accordion file or a filing cabinet. What’s most important is that you maintain whatever system you choose consistently. Few things are more frustrating than losing important papers.

2. Make copies immediately.
Have you ever tried to read an old credit card receipt? If it was on thermal paper chances are the print was faded. Avoid this dilemma by making copies of all documents that are prone to fade. You can attach the original to the front with a staple or paper clip.

3. Don’t rely on your computer for record keeping
If you purchase your extended warranty online be sure to print hard copies of the entire contract. Be sure to access the printer friendly screen so that no words are cut off. Murphy’s Law is often at work and chances are your computer will be down at the very moment you need to put your hands on the warranty.

4. Get everything in writing
Verbal agreements and arrangements are ultimately meaningless. Whether your agent doesn’t remember or leaves without a trace for another firm should have no bearing on your coverage. You must have a written document to stand on firm ground in the world of warranties.

If you are ever one of the many who suffer the misfortune of an automobile accident, you’ll need to quickly overcome the confusion, frustration and anger caused by the event to make sure your interests are protected.

The Ford Motor Company has provided the examples below to highlight a few important repair procedures that might occur during your time in a body shop, along with suggestions on how to help make sure you and your vehicle come out on the right track.

Parts Used for Repairs

If you are like most auto owners, you assume parts made by your vehicle manufacturer will be used to repair collision damage to your vehicle. Not necessarily so. “Imitation” or “aftermarket” parts made overseas and parts salvaged from other vehicles often are used in repairs.

Recommendation: You have the right to choose the type of parts used to repair collision damage to your vehicle. Before repairs begin, make sure you know what parts have been specified and then make sure your insurer and repairer know which type of parts you want to be used.

Airbag Replacement

Airbags have surpassed stereo equipment as the most frequent target of auto thieves, which has created a black market tapped by unscrupulous repairers, according to law enforcement authorities. Carfax.com, the Internet vehicle inspection firm, estimates that one in every 25 repairs requiring airbag replacement ends up with installation of a bogus airbag or no airbag at all.

Recommendations: Check Repair Invoice-After the collision repair, ask your repairer for a copy of the parts invoice to make sure replacement airbags were purchased from an authorized dealer. In the case of Ford, its dealers are the exclusive distributors of genuine replacement airbags and the company recommends that repairs be made only with these parts.