Getting the most out of your vehicle means being prepared for the occasional repair. One way to do this is purchasing a vehicle protection plan for your car, but does an extended warranty cost more than paying for repairs out of pocket?

In this article, we’ll look at what factors shape extended warranty costs and what’s included in coverage. Our review team has researched service providers across the aftermarket warranty industry to find the best extended car warranty companies. We recommend looking into your vehicle’s needs and getting free quotes to find the best price and coverage.

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In This Review:

    How Much Does An Extended Warranty Cost?

    Unlike the factory warranty, an extended warranty isn’t included in the price of the car. Our research found that the average cost of a third-party extended warranty is around $2,900. That said, there is no universal method for how extended warranty providers set rates.

    What Is An Extended Warranty?

    An extended warranty, also called a vehicle service contract, acts as an extension of the warranty coverage you receive when purchasing a new car. A car’s factory warranty covers the repair and replacement of many of the components that fail within a certain mileage or time period.

    Depending on the extended warranty you choose, you can get coverage similar to the manufacturer’s warranty or buy a plan that covers only crucial parts like the drivetrain.

    What Factors Influence The Cost Of An Extended Warranty?

    The cost of an extended car warranty is determined by several factors. Providers generally consider:

    • The condition and mileage of the vehicle
    • Warranty coverage limits and term lengths
    • The deductible amount

    Generally, choosing a more comprehensive plan increases the price of coverage. The same is true for picking a plan with a smaller deductible because the warranty provider handles more of the car repair costs in that case.

    What Coverage Comes With An Extended Warranty?

    The coverage that an extended warranty provides depends on the type of plan you choose. There are two main types of extended warranty plans: a bumper-to-bumper warranty and a powertrain warranty.

    • Bumper-to-bumper: This type of warranty covers most parts between the vehicle’s front and rear bumpers. It is sometimes called an exclusionary warranty.
    • Powertrain: A powertrain warranty backs your vehicle’s essential components, like the drive axle, engine, transmission, and transfer case.

    Each of these plans covers specific parts in the vehicle, but bumper-to-bumper warranties typically cover noncritical components in addition to a car’s essential parts and systems. Many third-party extended warranty companies offer a range of coverage options that can fall between these two types of plans, as well. It’s important to always thoroughly read through your warranty contract to familiarize yourself with what is and isn’t covered.

    Cost Of A Bumper-To-Bumper Warranty

    Bumper-to-bumper warranties offer a level of comprehensive coverage similar to what you would see in a factory warranty. As part of our research, we reached out to several well-reviewed independent warranty providers to get quotes for a 2018 Honda Civic with 30,000 miles. We were quoted the following prices:

    Warranty Company

    Protection Plan

    Warranty Length

    Extended Warranty Cost Per Month

    Down Payment

    Total Cost

    Endurance

    Supreme

    6 years/

    71,000 miles

    $74.60 for 36 months

    $161.35

    $2,846.95

    CarShield

    Diamond

    5 years/

    70,000 miles

    $88.78 for 18 months

    $109.99

    $1,708.03

    Protect My Car

    Supreme

    4 years/

    unlimited miles

    $58 for 48 months

    $50

    $2,834

    CARCHEX

    Titanium

    7 years/

    125,000 miles

    $89.01 for 36 months

    First month’s payment

    $2,574

    According to our research, CarShield generally offers the lowest overall cost compared to its competitors. It also has the shortest payment period, but coverage only lasts until the vehicle reaches 70,000 miles.

    For comparison, Endurance’s most comprehensive coverage option only lasts 71,000 miles, but costs about $1,100 more than CarShield’s. Each plan we obtained quotes for has a $100 deductible.

    Cost Of A Powertrain Warranty

    If your main concern is ensuring major systems like your engine and transmission keep working, you may be interested in a powertrain warranty. We reached out to several third-party providers to get quotes for a 2012 Subaru Outback with 88,000 miles.

    Warranty Company

    Protection Plan

    Warranty Length

    Extended Warranty Cost Per Month

    Down Payment

    Total Cost

    Endurance

    Secure

    5 years/

    51,000 miles

    $69.96 for 36 months

    $152.55

    $2,671.11

    CarShield

    Gold

    Unlimited

    $89.99 per month

    First month’s payment

    Varies

    Protect My Car

    Driveline

    4 years/

    unlimited miles

    $79 for 48 months

    $50

    $3,842

    CARCHEX

    Silver

    6 years/

    60,000 miles

    $108 for 24 months

    First month’s payment

    $2,592

    Even though CARCHEX has the highest monthly payment, it offers the lowest overall extended warranty cost. Certain plans from CARCHEX cover vehicles up to 250,000 miles, which is an advantage to those looking to keep older cars on the road.

    CarShield’s Gold plan could save you money since it’s a month-to-month plan, but maintaining your contract for several years could also end up costing you more than what you might pay with Endurance or Protect My Car.

    Other Benefits Of An Extended Warranty

    Besides handling a host of issues at the repair shop, vehicle service contracts often come with perks that can provide extra peace of mind if you file a claim. Here are some additional features that often come with an extended warranty:

    • Roadside assistance: If you need fuel or lock your keys in your car, the warranty provider will send someone to assist you.
    • Towing services: In the event of a covered mechanical breakdown, your warranty contract may offer towing to the closest repair facility within the provider’s network.
    • Rental car reimbursement: Your warranty provider may reimburse you up to a certain amount if you need to rent a car during a claim.
    • Trip interruption coverage: If your vehicle experiences a mechanical breakdown while you’re away from home, the warranty company may reimburse you for lodging and meal expenses.
    • Maintenance benefits: Some coverage plans include services like oil changes and other regular maintenance.

    If you are unhappy with your warranty, some providers offer money-back guarantees for a limited period during the start of your plan. You may be able to get a full refund, although it’s common for companies to subtract your deductible if you filed a claim early on.

    If you want to cancel a warranty later on, read the contract to see if the provider offers any money-back services. Also check whether it’s possible to transfer a warranty to a subsequent owner if you sell your vehicle.

    Do I Need An Extended Warranty?

    Whether you need extra protection against costly vehicle repairs depends on your situation. Unless you choose a month-to-month plan, purchasing a vehicle service contract may mean years of payments or a lot of money paid up front. Before you make a decision, consider what makes the most financial sense for your circumstances and check if you have any existing coverage.

    What Warranty Coverage Do I Already Have?

    Depending on the age, mileage, and make of your vehicle, you might still have some warranty coverage from the manufacturer. Factory warranties vary by carmaker–brands like Ford and Toyota offer a 3-year/36,000-mile bumper-to-bumper warranty and powertrain coverage for 5 years/60,000 miles. For comparison, Hyundai’s powertrain warranty lasts 5 years/100,000 miles.

    Some used vehicles are covered under certified pre-owned (CPO) warranties that offer similar levels of protection as the factory warranty. If you’re unsure about what coverage you may have, check the automaker’s website or reach out to the dealership where you purchased the vehicle.

    Can I Afford To Pay Out Of Pocket?

    With an extended warranty costing well over $2,000 on average, you’ll need to decide whether the financial commitment of a warranty plan is worth it for you or if you’d rather pay for potential repairs out of pocket.

    Around 40 percent of Americans would struggle to cover a surprise expense of $400, according to the Federal Reserve. If you can afford the monthly payments, a vehicle service contract could help you budget for any sudden repairs.

    That said, every extended warranty has a list of parts that aren’t covered, so there’s a chance you could foot the bill even if you have warranty coverage. If you are able to pay out of pocket, it’s possible that you could save on car repairs in the long run with an extended warranty.

    Our Research

    To better understand what contract holders and potential customers want in their warranty coverage, our experts polled 1,000 consumers who have purchased or considered purchasing an extended car warranty.

    We found that the extended warranty cost is the most important factor to consumers, with covered components and warranty term lengths ranked similarly in importance. Other findings from our survey include:

    • Over 41 percent of customers said they are satisfied with their warranty provider because it covered repairs, and around 24 percent said they never filed a claim but are still satisfied.
    • Around 40 percent of consumers we polled felt that an extended warranty is worth the investment, and 44 percent said it depends.
    • Approximately 75 percent of respondents said they had purchased extended warranty coverage through a dealership.

    What To Look For In A Warranty Provider

    If you are considering a protection plan for your vehicle, we recommend using reputable extended car warranty companies as your starting point. Unfortunately, some warranty companies use aggressive marketing tactics and push warranties with shoddy coverage.

    If you’re looking to get the most out of an extended warranty company, here are a few things to look out for to make sure you’re working with a reputable company.

    Check For Transparency

    The best way to check exactly what’s covered under your warranty is to review the contract. Plenty of reputable providers post sample contracts on their websites for customers to review. It allows consumers to see covered components and exclusions in detail and get an overview of the claims process.

    A salesperson should also give you a detailed overview of the coverage you qualify for during the quotes process. If a service provider won’t share the contract unless you buy a warranty, consider that a red flag.

    Read Industry Reviews

    The larger the company, the more negative reviews it is likely to have. Reputable warranty companies are no exception, but it’s important to see how a provider responds to customer complaints.

    You want to work with a company that takes time to respond to customer complaints and offers solutions to the problems. Customers share reviews and their experiences with many warranty companies through the Better Business Bureau (BBB) and Trustpilot, so these sites can provide a sense of what a provider’s customer service looks like.

    Compare Options

    Just like getting the best price on car insurance, taking time to compare warranty companies can help you get the best value. We recommend getting quotes from at least four companies to see what levels of coverage you qualify for and to compare service and costs.

    Our Recommendations For Warranty Coverage

    If you’ve decided that an extended auto warranty is the right choice for your vehicle, we recommend comparing quotes from a few top providers to get a sense for which company is a good fit. Based on our research, Endurance and CarShield are top-rated companies with affordable extended warranty costs and quality coverage options.

    Endurance: Best Coverage

    Our pick for Best Coverage is Endurance. The company has been providing extended warranty coverage for over 15 years and has built a reputation for great customer service. Endurance operates as a direct provider, meaning it manages all the plans it sells–an uncommon feature in the warranty industry.

    Each of Endurance’s six coverage plans includes a free year of Endurance Elite Benefits, which includes perks like 24/7 roadside assistance and tire repair/replacement.  The company is also highly rated by consumers on Trustpilot, with a score of 4.4 stars out of 5.0.

    You can read more about this provider in our Endurance warranty review.

    CarShield: Best Value

    Budget-conscious customers are likely to find great value with an extended warranty from CarShield. The provider offers month-to-month plan options, which don’t tie customers to long-term contracts, and most contracts are transferable to subsequent owners.

    CarShield offers some of the most affordable rates when it comes to comprehensive coverage. It has five plans available for automobiles and one plan designed for motorcycles and ATVs.  Similar to Endurance, CarShield has solid reviews on Trustpilot, with a 4.0 out of 5.0-star rating.

    For more information about the provider, check out our CarShield review.

    FAQ: Extended Warranty Costs

    • How much does an extended warranty cost?

      Our research shows that the average cost for an extended warranty is around $2,588. That said, the price you pay depends on your level of coverage, your vehicle, the warranty terms, and the deductible amount.

    • Should I buy an extended warranty?

      If you’re wondering whether an extended warranty is worth it, it ultimately comes down to your situation and your vehicle’s needs. If you’re worried about paying for costly repairs, then a vehicle protection plan may ease some anxieties and provide peace of mind. However, coverage plans don’t cover all mechanical breakdowns, and paying for repairs out of pocket might save you money in the long run if you’re in a position to do so.

    • Who has the best extended warranty?

      We named Endurance our top recommended provider due to its industry reputation and coverage. The direct provider has coverage plans for both new vehicles and higher-mileage cars, and it has excellent reviews from customers.

    How We Rate Warranty Providers

    Our review process aims to deliver consistent and unbiased assessments of extended auto warranty providers. While there are multiple qualities that make a warranty company successful, our review team focuses on those we believe are the most important for consumers:

    • Cost: Cost can be difficult to compare between providers because so many factors impact vehicle service contract pricing. To determine our cost score, we perform a secret shopper analysis for a variety of vehicles and plans and consider available deductibles.
    • Coverage: Our team of experts looks at the number of extended warranty plans available, as well as term limits, exclusions, and added benefits like roadside assistance. Ratings also take into account the availability of maintenance coverage.
    • Reputation: It’s important that an extended car warranty company is able to meet its claims obligations. Companies with a strong rating from the BBB score well in this category. Established providers with a long history of reliable service also receive positive marks.
    • Customer Experience: We listen to real customer sales calls and comb through reviews on sites like the BBB to learn about customer experiences. Warranty companies with a low volume of complaints score well in this area. We also consider the availability of mobile apps and chat features.

    *Data accurate at time of publication.