Avoid Third Party Warranty Scams
Avoid third party warranty scams on your vehicle and save money protecting your car and your finances. Third party extended warranty companies often have different ways of reaching drivers, from prerecorded phone calls to late night infomercials on the TV. Their exact techniques vary but often involve appeals to our sense of urgency and fear, with lines that suggest our warranties are about to expire and we need to extend them “before it’s too late!”.
If you get a notice in the mail from some third party company trying to sound official in its title and suggesting that it’s your “final notice” to extend your warranty (even though that company couldn’t possibly know the mileage of your car), you are almost certainly dealing with a third party warranty scam. The companies that send out these advertisements are not all scam artists, but like some advice on used vehicle forums, research has shown that a good number of them are up to no good .
Third Party Warranties Explained
There are a couple of repeated patterns of complaints that tend to come up against third party warranty providers, one of them being that these warranties are very hard to cancel out of and the other that making a claim on the policies is tough because there are so many exclusions. With such a strong pattern of trouble right there in front of us, it is useful to take a look at third party warranties and think about what they really are and what they represent.
A third party warranty on an automobile is just what it sounds like, a pact between the owner of the car and an entity that has no affiliation with the automaker. These warranties are very different from the extended warranties that you can get from the manufacturer when you buy your car, because those warranties promise to use OEM parts and technicians that are trained by the factory to handle repairs right at the dealership.
Manufacturer warranties in most cases cost more to purchase than third party warranties, but they also offer a lot more value for the money. In other words, when you see what each type of warranty costs and what it includes, you know exactly where the extra money went. The convenience and protection afforded to drivers with manufacturer warranties alone justify their extra expense. Many of the companies offering third party warranties are not even in business long enough to pay out a claim a few years down the road when something happens to your vehicle, leaving you out of all the money you spent to get that coverage.
Third Party Warranty Sales Pitches
In many cases, these sales pitches contain numerous inaccuracies. Some of them will mention the wrong purchase date for the car, suggest that your mileage is higher than it really is, and even get the make or model year wrong. Any missed detail like this is already a red flag that a third party warranty company is not to be trusted. They will usually suggest that your own manufacturer is about to expire (when in many cases it is not even close to being so), and throw out crazy high numbers for possible repair costs on vehicles that you could have to pay if you have no warranty, like an engine or transmission replacement job.
Many times you can check with the Better Business Bureau and see that companies like this have many different aliases and have had all kinds of complaints against them . Avoid trouble and don’t get burned by third party warranty scams.
 http://www.edmunds.com/auto-warranty/third-party-extended-warranty-scams.html Retrieved 2011-03-13.