Extended Warranties/Service Contracts

Extended Warranties, or Vehicle Service Contracts, as they are called, are an extremly good idea, despite the negative publicity they have generated. Even the most reliable cars break down, and when they do, they are very expensive to repair.

What is an 'Extended Warranty or Vehicle Service Contract?'

A vehicle service contract is a contract purchased by the consumer to protect their new or used vehicle against the unexpected costs of breakdown and repair, for a specific period of time.

What the contract does:

• Allows repairs to be made in accordance with the level of coverage you purchase.
• Ensures your vehicle is always working in the best possible mechanical condition.
• Allows repairs to be made when you need them, at a dealer (or one of their affiliates around the country), who is familiar with and services the particular make of car.

Why You Should Purchase an 'Extended Warranty Service Contract' :

• Peace of mind: You don't need to worry about additional costs.
• Convenience: Free rental vehicles, repairs made when you need them.
• Reliability: You can always be sure you will have a vehicle and that your vehicle is receiving the best possible service.
• Cost savings and added value to your car: Warranties are transferable and save you money in the long run on the cost of parts and labor.

Warranties protect you against the rising cost of auto parts and will add resale value to your car, since the contract is transferable. This means that whoever purchases your vehicle will be covered under the same terms you purchased. In addition, the comfort of knowing you are protected in a variety of situations beyond your control, is priceless.

It doesn't make sense to buy a warranty from a dealer:

Let me ask you this question: Would you pay $500 to have someone print a copy of your sales agreement? Of course not. So, it doesn't make sense to pay an extra $500 so the dealer can print a copy of your warranty contract.

A recent article in an automotice publication found that dealers made a profit of between $455 to $539 for every warranty contract they sold in 1999. A 6 year/100,000 mile warranty contract on a typical midsize sedan might cost the dealer $800, but they will turn around and sell that same contract to you for $1,345! That's a nice, tidy profit.

Furthermore, many dealerships are beginning to set up their own warranty companies, so when your car needs to be repaired, guess who has to approve the claim-the dealer!

However, you may buy the same warranty directly from the warranty company for much less than a dealer would charge!

We recommend Warranty Direct, if you want to purchase your own warranty. They offer complete service contracts to meet your specific needs, and the contract is honored at the repair facility of your choice.

The warranty will end up saving you hundreds or even thousands of dollars on unexpected repair bills-but you don't have to pay a dealer to purchase one for you!

About Warranty Direct

Warranty Direct Inc. is a wholly owned subsidiary of National Dealer Services, Inc. (NASDAQ:ISTN), one of the nation's largest vehicle warranty and service contract companies. They have been around for a long time, and will be around long down the road, so feel comfortable they will meet their obligation to uphold their end of the deal.

Interestate National Dealer Services has been named to the Forbes Magazine list of Top 200 Small Public Companies in America three years in a row. With 1,000,000 warranties under their belt, they far outpace any other company in terms of longevity, financial stability and claims reliability.

Warranty Direct is the nation leader in direct marketing of extended warranties. They cover automobiles, motorcycles, RV"s, boats and other recreational vehicles. Warranty Direct eliminates the middle man, so you can purcahse your warranty from the source, saving up to 60%.

What to look for WHEN PURCHASING AN EXTENDED WARRANTY

• True Bumper-to-Bumper Coverage: Not all contracts cover all your cars' parts. A true bumper-to-bumper plan will not list the items covered in the plan. A bumper to bumper plan is exclusionary, meaning it will only list the items NOT covered by the warranty. Typically, bumper-to-bumper contracts will list cosmetic and frequent maintenance items like brakes and oil changes, as not being covered.
• Wear-and-Tear Protection: This type of protection will cover you not only for the items that break, but for those that wear out. Individual parts in your policy should include their own wear-and-tear provision. Many plans will list wear-and-tear exclusions, like struts, piston rings, various valves and other expensive components. Beware of Mechanical Breakdown plans, they often include wear-and-tear exclusions, and offer thin coverage.
• Overheating: A good policy will NOT exclude damage due to overheating.
• Roadside Assistance: FREE nationwide roadside assistance will give you endless worry free driving. Make sure your coverage is per occurrence, not an out-of-pocket reimbursement plan, on only covered repairs.

A good policy will also include:
Emergency roadside service* Towing* Mechanical First Aid* Emergency Tire Service* Battery Assistance* Gasoline Delivery* Fluid Delivery* Emergency Lock-out Service* Nationwide Coverage* Toll FREE 800 Number* 24/ hours a day/365 days a year coverage*

Additional warranty features you may want to consider

• Car Rental: In case your vehicle has to remain in the repair shop overnight.
• Trip Interuption: Reimbursement for lodging and meals if your vehicle becomes disabled more than 100 miles from home, when the repair is covered under contract.
• Nationwide Protection: Allows you to have all repairs made at any repair facility across the United States.
• Choice of Deductibles: This will present you with an option of $0, $50 and $100 deductibles.
• Renewals: Will allow your plan to be renewed for a one-year term as long as you own your vehicle.
• Transferable: A transferable warranty allows you to transfer your warranty coverage if you sell the vehicle.

Dealertricks.com recomends Warranty Direct because of their comprehensive coverage packages, excellent benefits, and financial stability. You may choose from 3 different levels of coverage and up to 11 different terms.

Warranty Direct also offers a no in-service date program, which means the warranty begins on the day you purchase the warranty, not on the date the car is considered in-service. This also means a 7-year/100,000 mile vehicle warranty will expire 7 years from the date of purchase, or when the odometer reaches 100,000 miles. In simple terms, you are buying more warranty for your dollar when you purchase a Warranty Direct plan.