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mikefocke · 07-08-2011, 11:40 AM

Extended Warranty companies have perhaps the worst reputations in the insurance industry. Many companies are front companies that sell like heck and go out of business only to reemerge with the same personnel under a different name. So do your homework and read the fine print and do some research on who the company really is and who exactly provides the financial backing for the policy. I recall tracing one company through about 5 layers which allowed the selling company to go out of business and another to resume almost seamlessly.

Even the best only pay out ~30% of the premium (on average IIRC the figure is from Consumer Reports) in repair bills that benefit the policy owner, fight like heck with the mechanics, and can come up with all too many legal sounding reasons why that part isn't covered. Read the fine print on the contract, not the sales brochure.

Buying a policy is like going to a casino...most lose, a very few win big. And you will hear from those who won...while many of those who lost will remain silent lest they embarrass themselves.

07-08-2011, 11:40 AM	#2
mikefocke Registered User Join Date: Aug 2005 Location: Sanford NC Posts: 2,566	An opinion Extended Warranty companies have perhaps the worst reputations in the insurance industry. Many companies are front companies that sell like heck and go out of business only to reemerge with the same personnel under a different name. So do your homework and read the fine print and do some research on who the company really is and who exactly provides the financial backing for the policy. I recall tracing one company through about 5 layers which allowed the selling company to go out of business and another to resume almost seamlessly. Even the best only pay out ~30% of the premium (on average IIRC the figure is from Consumer Reports) in repair bills that benefit the policy owner, fight like heck with the mechanics, and can come up with all too many legal sounding reasons why that part isn't covered. Read the fine print on the contract, not the sales brochure. Buying a policy is like going to a casino...most lose, a very few win big. And you will hear from those who won...while many of those who lost will remain silent lest they embarrass themselves.