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Difference between a warranty and vehicle service contract

What we'll cover

  • The difference between manufacturer's warranty and a vehicle service contract

  • Manufacturer warranty details

  • Options to help you protect yourself

We’ve all been there: on our commute, on a road trip, or on the way home in the rain — and the check engine light flashes on. Uh oh. Almost everyone deals with car trouble at some point or another, and no matter the situation, it’s a pain in the you-know-what.

Fortunately, you can ease that pain with the knowledge that many of your auto woes are protected, whether by a manufacturer’s warranty or vehicle service contract (VSC). Not sure what the difference is or which option is best for you? We’ve got you covered.

Differences between manufacturer's warranty (provided by the auto manufacturer and built into the price of a new car) and a VSC (provided by the auto manufacturer, car dealership, or licensed repair shop for a separate or additional cost): The former offers basic mechanical, electrical, or safety repairs and sometimes offers roadside assistance, towing, trip interruption, and routine maintenance checks. It does not offer cosmetic fixes. The latter offers the same basic repairs, as well as components that fail due to wear and tear and sometimes roadside assistance, towing, trip interruption (reimbursement for hotel, food, etc), and cosmetic fixes. It does not offer routine maintenance, like oil changes/brake pad replacement.

Manufacturer’s warranty vs. a vehicle service contract

One of the biggest differences between a manufacturer’s warranty and vehicle service contract? A manufacturer’s warranty (exclusively offered by auto manufacturers) will expire, typically after three years or 36,000 miles.

Because manufacturer’s warranties are limited, they can’t be reinstated and are only included in the price of new cars. Even though it’s new to you, a used car that’s purchased outside of three years or 36,000 miles will typically not be eligible for a manufacturer’s warranty.

VSCs, sometimes referred to as extended warranties, are more flexible and may allow you to choose how long you’d like to protect your vehicle. You can purchase one when you first buy your car or on a car you already own. A vehicle service contract is an additional expense — but the cost of coverage could be significantly less than the out-of-pocket charges you’d be responsible for later should your car require a repair.

Most often, neither a VSC nor manufacturer’s warranty will cover cosmetic fixes (paint scrapes or dents) or routine maintenance, like oil changes, tire rotation, or replacing windshield wipers.

When it comes to auto coverage, you don’t want to be left out in the rain. By understanding your options and knowing exactly what’s protected by your manufacturer’s warranty or VSC, you can drive on with peace of mind.

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