At risk of sounding like a salesman for warranties...
Originally Posted By: Vikas
Extended warranties are bad for consumers. The manufacturer's is "less bad" than the 3rd party which is useless.
- Vikas
Of course, extended warranties will be profitable to the issuer. Otherwise they would not be offered. However, if
priced reasonably, they can be worthwhile to consumers who neither have the time or interest to shop around for repairs when they do experience issues. Also, many of us (yes, I am starting to become one of them due to the scarcity of time) are willing to pay a bit more for convenience. Most of these policies also include roadside assistance, which will save you from spending $90/yr on AAA. Since most people are going to spend 90/yr for AAA for 8 years, getting a policy priced at about $1000 that also covers the roadside assistance makes the real cost of the policy only a few hundred bucks. Lastly, it is important to understand that Honda usually does not pay for a rental for warranty repairs unless there is a Hondacare policy.
Originally Posted By: Vikas
And if something does go wrong, the warranty guy will weasel out of fixing your vehicle. Some of the creative ways they will come up to deny you the warranty are priceless. I get a huge laugh when I hear about them
Most warranties also have deductible.
But there are some folks who WILL buy $50 extended warranty on $200 gizmo and these are engineers!
- Vikas
You are forgetting that the authorization for manufactured-backed warranties is almost always done by the dealership. It is in their best interest to do the warranty work since they are being paid for it. If someone is taking a car in for a problem to be covered under an extended warranty, it isn't going to a minor squeak/trim problem (since those aren't covered), it is generally going to be a bigger issue such as a leak or an obvious failure of a component.
I do agree with you though that 3rd-party warranties have a tendency to have difficult authorization processes that can make claims difficult or near impossible. That is why I avoid most of those.
Originally Posted By: onebigunion
Agree completely. My repair expenses on my 05 Civic to 120k miles were exactly $0. Out to 200k miles, approximately $150 for front brakes pads and rear drum adjustment. I doubt if either of those items would be covered anyway.
I would not be so confident that all cars, even traditionally reliable ones, to be able to make it to 100k with no repairs. Though in the past, "simpler" cars (e.g. 4-cyl, few options) have a better chance. I was looking at a few late-model Hondas on a local dealer's website, which happens to list all reconditioning they do to their cars; a number of the higher mileage cars are requiring some smaller repairs such as A/C hoses, CV Boots and mounts well before the 100k mark. This seems to match what I am seeing on the various forums that I am on as well. These problems may seem minor to those of us who do our own repairs, but they can be costly to those who do not.
Originally Posted By: Hokiefyd
Of course, I never did use it, and I actually sold it back to Toyota when I traded the Corolla on my Camry, so I got some money back from it. But the point is, if they're offering it to you for $1,000, you know it only costs them $500 (or something substantially lower) to offer it. I've always heard that if you take a warranty or service plan price and half it, that's what you can figure spending on repairs. Because that's, on average, what it costs the manufacturer or retailer to administer the service. So anyway, talk them down. Tell them you'd give them $750 on it and see what they say. You might be able to talk them down much closer to what you can figure you'd spend anyway.
I understand where you are coming from. Usually the dealer will offer you the warranty at a high price and it would be a wise to negotiate with them to arrive at a lower price. The selling dealership was asking $1500 for the warranty, claiming that it was already their "sale price"
, but at the time I had neither the time or interest to negotiate with them.
Saccucci Honda is one of those online Hondacare sellers that have been heavily discussed and recommended by numerous Honda forums for purchasing policies at highly discounted prices and their pricing for the policies are quite reasonable.
As I have said before, each case is different. If I had purchased a bare bones 4-cyl Accord, I would skip it. Then again, I have no problem with shopping around for someone to do an out-of-warranty repair job or doing it myself. But this person is not-- they are one of those who will be in a major bind if they even had to
deal with a repair, let alone cough up the money for it suddenly. For this person, the small premium paid for convenience is probably worth it, especially if it costs just a few hundred bucks more than what they would otherwise already be paying for AAA. So again, it depends...
