Dealer or Aftermarket Warranty – Which is Suitable for You?

All car owners are issued a warning of not purchasing one without a warranty as it suggests foul play. It is a clear indication that you are buying a car using an under-the-table approach and leaves you completely vulnerable at the time of repairs or if a component requires replacement. It is advisable to be prepared for adversities beforehand.

However, there are two types of warranties you should be aware of – take a look:

Dealer warranty

Also known as manufacturer’s warranty, it is the coverage you receive after buying a new car that is provided directly from the manufacturer of that vehicle, hence the name. This type of coverage is included in the purchase price of the vehicle and covers defects, damages, and other issues that might have arisen during the design and/or manufacture process.

This warranty usually lasts for a certain period of time, and when it expires, you have the option to get an extended warranty if you still wish for car-related repair costs to be covered. A dealer’s warranty can only be serviced at a dealership franchised by the vehicle manufacturer. Used cars with time remaining on their warranty can avail the coverage offered by dealers.

Aftermarket warranty

This type of warranty is also referred to as a vehicle service contract, as it is more of a service plan that can be bought for any car. It is generally offered by a third party that is unaffiliated with the automotive manufacturer.

It provides dual coverage – costs incurred for repairs after the warranty expires, or expenses for repairs and replacements that are not covered by the warranty that is still active.

When you get an aftermarket warranty, it protects your car in advance for potential repairs in the long run. Vehicle service contracts are not to be confused with insurance plans, despite a few similarities. Moreover, they can be purchased for vehicles at any time, with a reasonable time and mileage limit, unlike a dealer’s warranty that is applicable for new cars only.

A vehicle service contract can be serviced at any repair shop of your choosing, unless limited by the contract.

Your buying behavior determines the type of warranty feasible for you. If you change cars often, then a dealer’s warranty is sufficient, but in case you want to stick with it for some years, an additional warranty will be helpful in protecting the vehicle from any damages or repairs in the future.


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