Would you buy the warranty?

[raptor556]

haha no.

Unless you like to pay for repairs up front.

 

[GoDucks]

Got 58k miles, think I should buy an extended warranty. Have had no issues so unsure if I should? My 2015 3.5 ecoboost gave me zero problems when I sold with 95k miles.

 

[flatwater17]

I’ve decided to ride out my 3 month warranty then I’ll probably snag a basic 3 year warranty for piece of mind.

 

[Old-Raptor-guy]

Understand the warranty company is in business to make money.

If they are good at what they do then by the law of averages you will loose.

If they are horrible at what they do (make money) they will go bankrupt and you will loose.

So the way I see it you only have a 33% chance of being better off with a warranty than without.

Dealing with these warranty companies on a daily bases it would seem that my thoughts of 33% are optimistic.

But here is how it works (which seems obvious but here we go)

There is always that one vehicle that needs 2x or 3x more $$$ than the contract cost.

The warranty company takes money from the contracts and pays the claims. so don't think if you don't use it, yours was all "profit" for the company.

In the end they normally get to keep about 15-18% and then after administration expenses they profit around 5%.

I know a guy who writes the algorithms for one company and they have it pretty well figured out.

 

[usnmustanger]

Still unclear on the consensus, and I'm interested since the dealer offered to sell me a Ally warranty, 36mo/36k miles for $3200, with the 2019 (60K mi on odo) I just bought. Seems steep. From what I gather in the very short time I've been on these forums, reliability in the first 100K miles (except the cam phaser issue) isn't a big deal, and certainly not work $3600...
Does that about sum it up?
TIA!

 

[raiderofthelostark]

I bought mine 12/21 and added the Ford warranty 6y/60,000 (up to 100k) for $4500 at the Ford dealer. There were two options, the same price. One serviced by Ford dealers only, and one (maybe Ally) serviced anywhere. My experience with the latter (on other vehicles not this one which is why I went Ford) is that any issue needs to have an experienced mechanic to justify the claims so that they pay out. Example: Your water pump goes out causing the head gasket to fry. The warranty company will try to only cover the pump but the head gasket may have caused more issues and is a larger overall bill. The Ford warranty (might) not have that problem whereas the third party one will if your shop/mechanic doesn't say/write the exact wording to file the claim.

Haven't had to use it yet but 6% of sale price isn't bad for a few more years of peace of mind.

 

[CruiserClass]

I used to work for Kemper Insurance, which was (is) a major underwriter for a lot of the warranty companies out there. Based on my exposure to the industry I would offer the following advice:

1) Never buy a 3rd party warranty of any kind for any product. No exceptions.

2) Long term, you will save money by self-insuring. Put your warranty money in some sort of fixed return account and draw on it for repairs as needed.

3) If you absolutely insist on buying a warranty, buy one that is through and backed by the original manufacturer. Look for an exclusionary warranty vs inclusionary. Exclusionary means everything is covered that is NOT specifically listed. Inclusionary means the only things covered are those specifically listed.

4) Understand completely your maintenance and reporting requirements to keep coverage in effect. They have an entire legal team devoted to nothing but tilting the contract in their favor and legally denying claims. Does your warranty force you to agree to arbitration only? Arbitration is entirely tilted in the favor of the company vs the individual. Prevailing in a dispute in arbitration is both time consuming and very unlikely to be successful.

5) "Peace of mind" is an often cited reason to buy a warranty, but is that peace of mind false? Are you *sure* they'll pay for any issues? Better luck with the OEM, but far from the guarantee you'd like to think. Can they get the parts? Will they priortize you? Use OEM and new components? Peace of mind is ready cash that you can take care of a problem on your own on your terms with your service provider of choice using your choice of parts, etc.

 

[tooloud10]

If it made any sense to buy extended warranties for an additional cost, they wouldn't exist.