An extended warranty is a service contract that covers major components or systems in a new car or used vehicle for a set period of time after purchase. An extended warranty is different from traditional car insurance in that it doesn’t cover damage that’s caused by an accident or other type of mishap. Instead, an extended warranty is focused on covering repairs to your car that are expected to arise from wear and tear over time. Extended warranties generally cover repairs to major components such as your engine and transmission over a period of time rather than just one incident that could arise from normal use. The coverage period for most extended warranties is anywhere from three months to two years after purchase. Some extended warranties may extend coverage up to 10 years or more.

What are the benefits of having an extended warranty?

An extended warranty has many benefits. First, it gives you peace of mind knowing that if any of your major components break down, they will be fixed before they become a major inconvenience or even a safety hazard. An extended warranty can also help you save money in the long run because unexpected repairs will be covered without having to come up with the money for the repairs upfront. Additionally, extended warranties often include helpful features like roadside assistance and the ability to rent a car if yours is out of commission.

How much does an extended warranty cost?

The cost of an extended warranty varies depending on the manufacturer and coverage period. Many automakers offer extended warranties on new vehicles and offer a variety of coverage options. Expect to pay $1,000 or more for an extended warranty on a new car. The cost of an extended warranty on a used car is often much less.

Dashboard features and safety equipment

These are the things that you’re almost certain to need for normal driving. Things like seatbelts, airbags, and anti-skid brakes are all standard in modern cars. You should also check that your car has a good tire tread and has been maintained by a certified technician.

Engine and transmission repair

This is probably the most common repair covered by extended warranties. This type of repair is usually covered for the entire coverage period, though some companies will require you to pay a small deductible. You may also be required to have your car towed to the shop and bring it back to its original condition.

Regular maintenance and repair

This is an important part of any extended warranty, but it’s often overlooked. Make sure you know what your car needs and when, and make sure you take care of it on time. Otherwise, you may not be covered if a repair needs to be done sooner than expected. This category covers things like oil changes, tire rotations, and other minor repairs that help keep your car in tip-top shape.


An extended warranty can help you avoid a costly repair by covering the cost of unexpected repairs before your car breaks down. They are a great option for drivers who want peace of mind on a budget. Make sure you read the fine print and understand what’s covered and what isn’t so that you can make the most of your extended warranty.