What Does Vehicle Service Contract Mean

Vehicle maintenance contracts, or VSCs, are comprehensive plans that pay for mechanical failures and unplanned repairs. Service contracts are usually sold by the manufacturer or dealer when you first buy your car, but can also be purchased at any time from independent third-party companies, even if you refinance yourself. External service providers act completely independently of your manufacturer. This comes with some risk: unlike buying an extended warranty from Ford or Hyundai, you`ll need to look for a third-party supplier to make sure the company is trustworthy. A vehicle maintenance contract – also known as an extended car warranty, vehicle protection plan, or extended service contract – protects you from paying for unexpected car repairs out of your pocket after your factory warranty expires. Before you sign on the dotted line, look around to compare plans from different providers. Because a VSC can be added to a car at any time, there is no time limit on when you need to buy a plan, and you shouldn`t feel guilty about rejecting what a dealer or lender offers you. Comparative purchases can help you find the best value for money, with coverage that best suits your needs and budget. If you have a dispute about whether to pay a claim, contact the administrator.

If the administrator leaves the store, the merchant may need to perform the work under the contract. The reverse can also be the case – if the merchant leaves the store, the administrator may be asked to comply with the terms of the contract. Vehicle maintenance contracts also do not cover existing problems. Most providers have a waiting period of 30 days and 1,000 miles before coverage takes effect. This is to ensure that your vehicle does not have any existing defects. For more information, read our full CARCHEX review. You can also click below to find out how much a CARCHEX warranty would cost for your vehicle. If you`re trying to choose between CARCHEX and Endurance, check out our Endurance vs CARCHEX review.

Even the most extensive vehicle maintenance contracts have some exclusions. Most plans don`t cover the following: Keep all your service records, no matter who performs the service. These include oil changes, tire rotations, belt changes, new brake pads, and inspections. Create a file to track repairs – it will come in handy if you need to use your warranty. If you ever have a warranty claim and it appears that you have not maintained your vehicle, your claim may be denied. Some plans are also specifically tailored to older or high-mileage vehicles, giving you the option to cover a car that has seen better days and is not eligible for warranty coverage. There are two main types of vehicle maintenance contracts: a powertrain warranty and a bumper-to-bumper warranty. A powertrain warranty covers the components that move your vehicle: engine, transmission, transfer case, drive axles and other related components. A bumper-to-bumper warranty covers most parts of the vehicle between your front and rear bumpers. Bumper-to-bumper warranties are often exclusive, which means that instead of listing each covered party, your contract will only mention what is not covered. A vehicle maintenance contract is not a guarantee.

Instead, it`s a separate service where the VSC provider promises to pay for repairs covered by your specific policy. However, as with warranties, service contracts remain in effect until one of two events: your car reaches the maximum allowable mileage under your plan or the policy term expires. While they contribute to the cost of owning your car, car service contracts offer a variety of benefits that can more than offset the cost of a plan — and save you money on expensive and unexpected vehicle repairs. Some contracts are also refundable. If you trade in or sell your vehicle to someone who chooses not to have the plan transferred, a refundable plan allows you to cancel the contract in exchange for a prorated refund minus previously paid claims. Only a few car maintenance contracts cover all repairs and maintenance. Beware of exclusions that deny coverage for any reason. For example, if the contract states that only “mechanical failures” are covered, problems caused by normal wear and tear can be excluded.

Then comes the logistics to bring your disabled vehicle to a safe place. Of course, it`s not without its unexpected blow to your finances. The average tow costs between $50 and $125 for a local tow of five or 10 miles. On average, a long-haul tow starts at $75 plus an additional fee of $2 to $4 per mile. Warranties often do not cover minor repairs for parts such as brakes or heating and cooling systems. While the coverage ratio varies from plan to plan, many vehicle maintenance contracts cover components and services beyond those covered by a standard warranty, which can save you money on minor repairs during the contract period. Before you buy an auto service contract, compare it to your car`s warranty to see when the coverage applies and if it overlaps. A service contract, also known as an extended warranty, is a contract that covers certain vehicle problems or repairs after the dealer`s or manufacturer`s warranty expires. That said, even parts that appear to be covered by a contract won`t always be covered as you hoped. Many contracts explicitly state that they only apply to mechanical failures and exclude repairs due to wear. This means that even if one of your covered components breaks for a reason other than that stated in the contract, you will have to pay the repair invoice.

A typical vehicle maintenance contract is comprehensive and covers everything from transmitting your car to navigating and air conditioning. Below is a list of the most common repairs covered by service contracts, as well as the average cost of each repair. We sorted out the best and worst suppliers and some companies that were at the top. Let`s take a look at what makes them great, all of which offer extra coverage, like roadside assistance, towing services, and rental car refunds. Warranties often require you to return your car to the dealership or authorized repair shop. On the other hand, many vehicle maintenance contracts of your choice allow the mechanic or auto repair shop to work on your car. If you have a favorite or trusted mechanic, their work is likely to be covered by your VSC. If possible, try to purchase a plan that is considered transferable. Transferable service contracts could potentially increase the resale value of your car. An automobile warranty is a contract to correct certain defects or malfunctions for a certain period of time after the purchase of a car.

A manufacturer`s warranty is usually included in the purchase price when you buy a new car, but used cars can also be covered by some sort of warranty. Fortunately, most vehicle maintenance contracts offer towing service and roadside assistance, as well as rental car refunds. While these benefits don`t relieve your frustration if you don`t have a working car, they can certainly reduce the financial burden if you don`t already have similar coverage. .

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