Can I Purchase Extensions and Upgrades to My Vehicle Service Contract? and Is it Worth It

What is a Vehicle Service Contract?

A vehicle service contract, sometimes referred to as an extended warranty, is an optional plan you can buy to help cover the cost of certain repairs your vehicle may need while it is owned by you. These plans usually begin when the manufacturer’s warranty expires, but sometimes the coverage overlaps.

Unlike the manufacturer’s warranty, a vehicle service contract is an additional fee that the consumer must pay. It covers the cost of repair, replacement, or maintenance of the vehicle due to defects or normal wear-and-tear.

When considering buying an extended car warranty, consumers should verify that the company is properly licensed and not be fooled by mail or telephone solicitations. They should also check to see if their manufacturer’s warranty is still in place. Before agreeing to purchase an extended warranty, consumers should request a written contract to review and make sure they understand the terms. Finally, it is important to do business with a company that is known and trusted.

 

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What are the Benefits of Purchasing a Vehicle Service Contract with Extensions and Upgrades?

1. Extra coverage for repair costs of certain parts and components of the car.

A vehicle service contract with extensions and upgrades includes extra coverage such as towing, roadside assistance, trip interruption reimbursement, and rental car coverage. These extra benefits are typically only applicable if the issue is covered by the warranty and the repair is necessary. It’s important to look into who is providing the extra coverage and any limitations associated with it, such as deductibles or reimbursement policies. Additionally, it’s important to make sure you don’t already have duplicate coverage from being a member of an organization like AAA. Finally, some extended warranty policies come with a “wrap” that covers certain non-powertrain vehicle components after the car’s new car warranty expires, and some may cover powertrain components after the new car powertrain coverage ends.

2. Additional peace of mind in case of unexpected car repairs.

Purchasing an extended warranty or service contract for a vehicle can provide peace of mind for drivers who worry about unexpected repair costs. This option can be especially useful for those who do not have the discipline or funds to set aside money for repairs, or who otherwise would not be able to pay for the repairs out-of-pocket. The coverage from an extended warranty ensures that repairs are covered after the standard warranty expires, reducing the financial strain of any unexpected repairs. Additionally, extended warranties can provide additional benefits such as rental car coverage, which can be paid through reimbursement. On the other hand, for those with reliable cars and sufficient funds, an extended warranty may be an unnecessary expense. Ultimately, whether or not to purchase an extended warranty is a personal decision and should depend on the individual’s financial situation and needs.

3. Ability to negotiate a lower deductible with your repair shop.

Purchasing a vehicle service contract with extensions and upgrades can help you negotiate a lower deductible with your repair shop. This is because the contract provides coverage for more parts as well as additional benefits such as rental car coverage. With a service contract, you can often select a higher deductible in exchange for a lower premium, allowing you to pay less in the event of a repair. Additionally, some plans can guarantee factory-trained technicians and allow you to roll the cost of the plan into your auto loan. As a result, you can enjoy greater peace of mind while also saving money.

4. Coverage for repairs due to corrosion, dry-rot, and certain malfunctions.

A vehicle service contract with extensions and upgrades can provide coverage for a variety of repairs, including but not limited to: mechanical parts and labor, electrical components, engine and transmission repairs, brakes and suspension, exhaust systems, fuel systems, cooling systems, air conditioning and heating, and even some non-mechanical parts such as glass, audio/entertainment systems, and interior components. These options are usually customizable, so you may be able to add additional coverage to your plan. Extended warranties can also provide coverage for major repairs and updates to your vehicle, such as engine and transmission replacements, turbocharger and supercharger repairs, and other performance upgrades.

5. Access to roadside assistance services and rental car coverage.

Vehicle service contracts with extensions and upgrades typically include roadside assistance services such as towing, jump-starting, flat tire assistance, fuel delivery, lockout service, and emergency roadside assistance. Additionally, they may include rental car coverage, which can provide reimbursement for a rental car when a vehicle is kept overnight for a warranty-covered repair. It is important to understand the details of each service contract and the limitations that apply to the additional benefits before signing any agreement.

6. Coverage for certain powertrain components, such as the engine, transmission, and axle.

A vehicle service contract with extensions and upgrades typically covers the powertrain components including the engine, transmission, axle, driveshaft, wheels, steering, brakes, front suspension, electrical, and other parts related to keeping the car moving. Additionally, a wrap warranty could provide coverage for other parts of the car, including the battery, clutch, and some drive belts. Furthermore, some extended warranties may also include additional benefits such as roadside assistance, reimbursement for hotel rooms and rental cars, and coverage for trip interruption.

7. Ability to transfer your warranty to a new owner when you sell your car.

Purchasing a vehicle service contract with extensions and upgrades can help with the transfer of a warranty when you sell your car. If the warranty is transferable, it can add value to the sale of your car and can be a great selling point for potential buyers. In the case of a manufacturer warranty, you can easily transfer the warranty to the new owner of the vehicle with no additional fee, while a third-party warranty may require a transfer fee. The transferability of the warranty can even slightly increase the resale value of your car. Furthermore, by purchasing a vehicle service contract with extensions and upgrades, you can have peace of mind knowing that you have access to free repairs and can take road trips without worrying about potential issues.

8. Access to manufacturer warranties and programs

Service contracts with extensions and upgrades can offer a variety of warranties and programs. Manufacturer warranties are available from companies like Honda and Ford and offer factory-trained technicians and OEM parts. However, these warranties typically require you to visit a dealership for repairs and may not last as long as third-party options. Third-party providers like Endurance and CarShield offer extended car warranties with a variety of coverage options and may have you go to dealerships, networks of approved shops, or any ASE-certified repair facility. Additionally, many dealerships offer third-party warranties from varying companies, and it is important to research the provider before signing any contract.

9. Ability to save money on repair costs with warranty coverage

Purchasing a vehicle service contract with extensions and upgrades can help to save money on repair costs with warranty coverage by providing coverage for repairs that would otherwise have to be paid out of pocket. This coverage can be especially beneficial for costly repairs that would otherwise drain an individual’s finances. Additionally, these contracts can help to provide peace of mind for drivers who might worry about how they would pay for a repair. Furthermore, the cost of the contract can often be rolled into an auto loan, so drivers don’t have to pay for it all at once.

10. Coverage for out-of-pocket expenses in case of a claim

A vehicle service contract provides coverage for out-of-pocket expenses in the case of a claim for repairs related to mechanical breakdowns, defects, and normal wear and tear. This coverage typically pays for parts and labor involved in the repair or replacement of the covered component, minus the applicable deductible. In addition to repair coverage, many extended auto warranty products come with extras, such as roadside assistance, towing, trip interruption reimbursement and rental car coverage. These added benefits can help provide peace of mind in the event of an unexpected breakdown and can help cover additional costs associated with the repair.

Different Types of Extensions and Upgrades that can be Purchased for Vehicle Service Contracts

1. Warranty Upgrades

Warranty upgrades that can be purchased for vehicle service contracts vary depending on the type of coverage the purchaser desires. Some popular warranties include:

  1. Bumper-to-Bumper Warranty: This type of warranty is the most comprehensive, covering all of a vehicle’s parts and systems, excluding routine maintenance and damage from wear and tear.
  2. Powertrain Warranty: This warranty covers repairs and replacements for major components such as the engine, transmission, and drivetrain.
  3. Rust Perforation Warranty: This warranty covers repairs and replacements for any rust-related damage that renders the vehicle unsafe or unusable.
  4. Roadside Assistance Warranty: This warranty covers costs associated with towing and roadside assistance, such as tire changes, jump-starts, fuel delivery, and lockout services.
  5. Rental Car Reimbursement Warranty: This warranty covers expenses associated with renting a car when your vehicle is being serviced or repaired.
  6. Trip Interruption Coverage: This warranty covers costs associated with lodging, meals, and transportation when your vehicle breaks down more than 100 miles away from home.

2. Coverage Tiers

Vehicle service contracts can be classified into three tiers of coverage: basic, comprehensive, and ultimate. Basic coverage plans typically provide protection against breakdowns due to mechanical and electrical failure, while comprehensive plans usually add additional coverage such as collision, towing, and rental car coverage. Ultimate plans typically offer the highest level of coverage and may also include extended scheduled maintenance coverage beyond 3 years or 36,000 miles. All plans come with an applicable deductible that must be paid for covered repairs.

3. Mechanical Breakdown Protection

Mechanical breakdown protection (MBI) is a type of vehicle protection insurance policy that provides coverage that is closer to an extended warranty than what traditional auto insurance offers. It covers unexpected issues with your vehicle and is paid for by monthly premiums. It typically has a deductible ranging between $0 and $500, and you will usually be reimbursed for costs if you need to use the policy. Not all cars are eligible for MBI, and it can be canceled at any time. In addition, DIY maintenance can save you money on major repairs. MBI can be used to cover major mechanical issues, including parts and labor, in the event of unexpected failure or breakdown.

4. Powertrain Coverage

Powertrain coverage that can be purchased for vehicle service contracts includes a powertrain warranty, a wrap warranty, and a drivetrain warranty. A powertrain warranty covers everything that keeps a car moving, such as the engine, transmission, and some electrical components. Exclusions typically include the battery, clutch, and some drive belts. A wrap warranty supplements a powertrain warranty, providing coverage for the rest of the car and giving you full bumper-to-bumper coverage. Lastly, a drivetrain warranty is similar to a powertrain warranty, except it excludes the car’s engine and covers the vehicle’s transmission, driveshaft, axles, and wheels.

5. Airbag System Coverage

Airbag system coverage is available as part of vehicle service contracts. This coverage includes protection for the airbags and their accompanying systems, such as sensors, wiring, and the control module. This coverage can help protect against any malfunctioning parts due to manufacturing defects.

6. Additional Benefits

What additional benefits can be purchased for vehicle service contracts? [Expanded list] Additional benefits that can be purchased for vehicle service contracts include coverage for up to 200,000 miles or more, access to factory-trained technicians, rental car coverage (which is paid through reimbursement), and interest-free financing up to 30 months. Transferability of the plan may also increase the resale value of your vehicle.

7. Tech Features

When purchasing a vehicle service contract, various tech features can be included. These features typically cover vehicle systems such as drivability, overall performance, industry standing, coverage, cost, transparency, and customer service. The features available may differ depending on the company, so it is important to research the various options before making a decision. Some of the tech features that may be included are: industry standing, which looks at the company’s reputation and history; coverage, which outlines what services will be provided; cost, which includes any additional fees associated with the contract; transparency, which ensures that customers have access to clear and complete information; and customer service, which ensures that customers have access to knowledgeable and friendly representatives.

Whether it is Worth Purchasing Extensions and Upgrades to a Vehicle Service Contract

1. Service Contract: Price

When shopping for an extended warranty or service contract for a car, electronic device, or major appliance, it is important to know how much it will cost before making a purchase. Service contracts can have a range of prices, depending on the type and coverage of the contract. Generally, service contracts cost between 10-20% of the purchase price of the item.

It is important to evaluate the coverage of the service contract and compare it to the warranty that comes with the product. In some cases, the extended warranty or service contract may provide extra benefits, such as roadside assistance, that may be worth the extra cost.

When purchasing a motor vehicle extended service contract (MVESC) in Missouri, the cost will vary depending on the features included in the contract. The cost may also depend on the age, make, and model of the car, as well as the length of the contract. It is important to read the contract carefully and understand the terms before agreeing to purchase an MVESC.

When purchasing an MVESC, there is a “free-look” period where you can get a full refund within 20 business days from the time the contract is issued or mailed. Additionally, it is possible to save money by checking to see if your manufacturer’s warranty is still in place, as well as by choosing a company that is recommended by someone you trust.

In conclusion, the cost of an extended warranty or service contract will vary depending on the type of product and coverage. It is important to compare the coverage of the extended warranty or service contract to the warranty that comes with the product and to be aware of the “free-look” period and other costs saving tips.

2. Service Contract: Coverage

Vehicle service contracts typically provide two types of coverage: inclusionary and exclusionary. An inclusionary extended car warranty covers parts specifically listed in the contract, while an exclusionary vehicle service contract covers everything except items listed as non-covered parts. Exclusionary auto warranty contracts are usually more comprehensive and have higher price tags than inclusionary contracts.

Consumers should be aware of potential deceptive practices when shopping for a motor vehicle extended service contract. For example, it’s illegal for telemarketers to call if the consumer’s phone number is on the Missouri No Call list or the federal Do Not Call Registry. Additionally, companies may not falsely claim to know the status of a consumer’s factory warranty, nor may they use the word “warranty” in their marketing materials. Consumers should also verify that the company is properly licensed to do business in Missouri by calling the Department of Insurance Consumer Hotline.

3. Service Contract: Duration

How long is the duration of a vehicle service contract? The duration of a vehicle service contract varies depending on the type of contract and the provider, but typical contracts range from one to seven years. Missouri law requires that consumers get a full refund within 20 business days from the time the contract is issued or mailed, but any refund not paid in full within 45 days of the return of the contract will be assessed a 10 percent penalty each month until the refund is paid. Consumers should make sure that they understand the terms of the contract before signing, as well as any other conditions that may affect the length of the contract.

4. Service Contract: Amount Paid

The cost of purchasing an extension and upgrade to a vehicle service contract will depend on the type of coverage you want, the make and model of your vehicle, and the provider you choose. Generally, extended warranties can range from a few hundred dollars and up. Some providers offer multiple levels of coverage, so you can select the option that best fits your budget and needs. You can compare different providers and levels of coverage to help you find the best deal. It is important to note that you may not need an extended warranty if your vehicle’s factory warranty is still in place.

5. Service Contract: Buyback

The buyback feature of a vehicle service contract is an additional protection for buyers. It allows consumers to receive a refund on their contract if they find that the service contract is not worth the money they paid for it. This feature is especially beneficial for those who buy extended vehicle warranties after the factory warranty has expired and they are no longer covered. The buyback feature provides peace of mind that if the service contract does not deliver the protection they were expecting, they can get their money back without any penalty. This is why it is worth purchasing a vehicle service contract with the buyback feature. With this feature, consumers can rest assured that if the service contract doesn’t offer the coverage they need, they won’t be out of pocket. Additionally, it gives consumers the opportunity to shop around for the best service contract for their needs, as they can return any contract that isn’t up to standard.

6. Service Contract: Eligibility Requirements

In order to be eligible for purchasing an extension and upgrades to a vehicle service contract, the consumer must:

  1. Be the registered owner of the vehicle
  2. Have a valid driver’s license
  3. Have a valid state of residence
  4. Have the vehicle serviced regularly
  5. Have a valid VIN number
  6. Not have any major mechanical issues with the vehicle that are not covered under the existing warranty
  7. Accept the terms and conditions of the contract
  8. Pay any applicable fees
  9. Provide proof of insurance
  10. Agree to all the requirements as outlined in Section 385.200-220 RSMo of the Missouri Revised Statutes.

7. Service Contract: Restricted Activities

The restricted activities included in a vehicle service contract are: they must offer a “free-look” period where consumers can get a full refund within 20 business days; they may not use the word “warranty” in the sales and marketing materials; they may not claim a false affiliation with a motor vehicle manufacturer or dealer; they may not falsely claim to know the status of the consumer’s factory warranty; they may not use deceptive practices in any term or provision of the contract; telemarketers may not call customers whose phone numbers are on the Missouri No Call list or the federal Do Not Call Registry. Additionally, consumers should be aware that it is illegal for telemarketers to call them if their phone number is on the Missouri No Call list or the federal Do Not Call Registry and that they should verify the company is properly licensed to do business in Missouri by calling the Department of Insurance Consumer Hotline, 800-726-7390.

8. Service Contract: Warranty Options

When considering a vehicle service contract, consumers have two options: inclusionary and exclusionary. An inclusionary extended car warranty covers parts specifically listed in the contract, and not any parts that are not specified. Exclusionary vehicle service contracts cover everything except items listed explicitly as non-covered parts. In general, exclusionary auto warranty contracts are better than inclusionary contracts, however, it is important to go through the list of coverage to ensure that expensive components that may fail are covered. Exclusionary warranty products typically have higher price tags than more limited inclusionary extended auto warranty products. As well, consumers can opt for an extended warranty, or a vehicle service contract. An extended warranty extends the coverage limits of a factory warranty, while a vehicle service contract is a different agreement between the consumer and the automaker or third-party provider. Vehicle service contracts offer more options, opportunities, and a greater number of plans, additions, limitations, and more.

9. Service Contract: Cost Structures

When shopping for motor vehicle extended service contracts (MVESC), it’s important to understand the cost structure. The cost of an MVESC will depend on the age and condition of the vehicle, the type of coverage chosen, and the deductible. The cost can range from a few hundred dollars to several thousand dollars. While an MVESC may cost more than a factory warranty, it may provide additional coverage and protection for more expensive repairs and maintenance.

It is important to compare the cost of an extended service contract to the cost of the factory warranty. The factory warranty typically covers defects only, and may not cover normal wear-and-tear or more expensive repairs. On the other hand, an MVESC may cover more repair issues, and may also provide a lower deductible.

It is also important to compare the terms of the warranty to the terms of the service contract. Some service contracts may include coverage for towing, rental reimbursement, and roadside assistance. Be sure to read the fine print carefully and make sure you understand what is covered and excluded before making a decision.

10. Service Contract: Repairs and Maintenance

A vehicle service contract covers the cost of repair, replacement or maintenance of a vehicle due to defects or normal wear-and-tear. Included in the contract are repairs related to engine and transmission, brakes, electrical systems, cooling systems, climate control systems, steering, suspension, and other general maintenance. Some contracts may also cover the cost of towing, car rental, and some travel expenses.

11. Service Contract: Cost of Ownership

When considering whether to buy an extended warranty or service contract, it is important to look at the initial cost of the product, as well as the likely cost of repairs. An extended warranty or service contract may not be worth the money if a product isn’t likely to need repairs or if repairs won’t be expensive. However, a vehicle service contract can be a great way to protect the cost of ownership of a vehicle. Vehicle service contracts often cover more than the warranty that comes with the vehicle, and they can cover a variety of issues that a regular warranty doesn’t, such as towing and rental car costs. While extended warranty coverage can cost more up front, it may be worth the additional cost if it provides more extensive coverage than the warranty on the vehicle. Ultimately, the cost of ownership should be weighed against the cost of a vehicle service contract to determine which is the better value.

12. Service Contract: Refunds

When shopping for a motor vehicle extended service contract (MVESC), it is important to understand the terms of the contract and the refund policies associated with it. In Missouri, the law requires that administrators, providers and other producers of MVESCs offer consumers a “free-look” period of 20 business days from the time the contract is issued or mailed—during which time, if the consumer does not find the terms satisfactory, he or she can receive a full refund of their money. In addition, any refund not paid in full within 45 days of the return of the contract will be subject to a 10 percent penalty each month until the refund is paid.

Consumers should also be wary of false claims made by the producer of the service contract and be sure to verify the company is properly licensed to do business in Missouri by calling the Department of Insurance Consumer Hotline. Before agreeing to purchase an MVESC and making a payment, consumers should request a written contract to review and understand the terms. Finally, if a consumer suspects any deceptive practices or fraud, they should report it to the Federal Trade Commission or their state attorney general.

13. Service Contract: Transferability

Yes, the service contract is transferable. Ford Protect Extended Service Plans are transferable and may increase the resale value of the vehicle. Consumers are also allowed to transfer their contract once, after which it becomes non-transferable. However, it is important to note that a refund can be requested within 20 business days of purchase.

14. Service Contract: Theft Protection

A service contract offers protection from theft by providing coverage for repair or replacement of a vehicle due to theft or attempted theft. This coverage is typically provided in addition to any factory warranty or other coverage that may be in place. The terms of the coverage should be clearly stated in the service contract, including what types of theft are covered, what the deductible will be, and any other applicable limitations. Additionally, service contracts may provide other benefits such as rental car coverage or roadside assistance that can help mitigate the financial impact of the theft.

15. Service Contract: Roadside Assistance

A vehicle service contract roadside assistance typically includes tow truck towing, trip interruption reimbursement, and rental car coverage. Tow truck towing provides assistance when a part covered by the warranty has failed and needs to be towed to a repair facility. Trip interruption reimbursement covers any expenses incurred while your vehicle is being repaired and you are unable to continue your trip. Rental car coverage will reimburse the cost of a rental vehicle if your vehicle needs to be kept overnight for a covered repair.

16. Service Contract: Vehicle Dependability

Vehicle dependability is a measure of how reliable a vehicle will be over time. It is determined by looking at the frequency and severity of breakdowns, repairs, and other issues in the first few years of a vehicle’s life. Good dependability ratings make a vehicle more valuable to potential buyers, as it is seen as a long-term investment.

Vehicle dependability can have a big impact on the value of a vehicle service contract. If a vehicle is more likely to break down, a service contract becomes more important to prevent costly repairs. On the other hand, if a vehicle is extremely reliable, it may not be necessary to purchase an extended warranty. It’s important to consider the vehicle’s dependability when making any decisions regarding extended warranties.

17. Service Contract: Repairs and Maintenance

A motor vehicle extended service contract typically covers the cost of repair, replacement, or maintenance of a vehicle due to defects or normal wear-and-tear. This includes repairs and maintenance for the engine, transmission, air conditioning system, brakes, and electrical system, as well as other components of the vehicle. It may also cover labor costs associated with the repairs or the cost of any parts that are needed for the repair. Depending on the contract, it may also cover towing services, rental car fees, and other additional benefits.

18. Service Contract: Warranty Reporting

A service contract helps with warranty reporting by providing protection when defects or normal wear-and-tear cause a problem with the vehicle. Consumers can purchase motor vehicle extended service contracts (MVESCs) to cover the cost of repair, replacement or maintenance of their vehicle. Missouri law also requires administrators, providers and other producers (marketers) of motor vehicle extended service contracts to offer a “free-look” period that allows consumers to get a full refund within 20 business days from the time the contract is issued or mailed. Additionally, consumers are protected from deceptive practices in any term or provision of the contract. Finally, resources such as the Department of Insurance Consumer Hotline and the Missouri No Call list or the federal Do Not Call Registry provide resources to help protect consumers.

19. Service Contract: Customer Service

The customer service features of a vehicle service contract include a “free-look” period during which the consumer can get a full refund within 20 business days from the time the contract is issued or mailed. Additionally, a 10 percent penalty will be assessed each month until the refund is paid if the refund is not paid in full within 45 days of the return of the contract. It is also important for consumers to make sure that the company is properly licensed to do business in Missouri by calling the Department of Insurance Consumer Hotline, and to be suspicious of mail or phone solicitations that suggest your factory warranty is about to expire. Additionally, consumers should verify that their manufacturer’s warranty is still in place before agreeing to purchase an MVESC or make payment, and should always request a written contract to review before doing so. Finally, Missouri law requires motor vehicle service contracts to explain exactly how the repair and reimbursement process works, including what repairs are covered and any deductibles that apply.

20. Service Contract: Security Damage

The security damage coverage feature is an important component of a motor vehicle extended service contract (MVESC). This feature covers damage or theft to the vehicle caused by an accident or other external factors, such as floods or hail. This additional coverage is important because it can help protect a consumer’s investment in the vehicle and any repairs or replacements that they may need in the future. Without this coverage, the consumer may be responsible for any costs related to the repair or replacement of the vehicle due to accidental damages or theft.

In addition to the security damage coverage, it is also important to consider purchasing extensions and upgrades to a vehicle service contract. These can help to increase the level of protection and coverage offered, as well as provide additional benefits, such as roadside assistance and towing. Upgrading a vehicle service contract can also help to provide peace of mind and protection for consumers in the event of a breakdown or accident.