What Does a Car Warranty Cover? (2024 Informational Guide) (2024)

×

A car warranty is an agreement from either an automaker or a third-party company to cover the cost of certain car repairs. Whether backed by manufacturers or independent providers, these vehicle protection plans last for a set number of years or miles. Both automakers and warranty companies offer extended coverage to stretch your original new car warranty.

After a factory warranty expires, drivers can turn to independent warranty companies for a used car warranty. These offer protection against unexpected repairs, though some car owners get certified pre-owned (CPO) coverage from automakers instead.

Put simply, a manufacturer’s warranty guarantees that all parts in a new vehicle are in proper working order. These factory warranties cover mechanical failures that occur during normal vehicle use or due to flaws in workmanship. Covered repairs will almost always be performed at either a dealership or a brand-authorized repair facility.

What Isn’t Covered by a Car Warranty?

Car warranties generally won’t cover routine maintenance services like oil changes or damages caused by a lack of regular upkeep. Other exclusions include car parts such as tires, brake pads, wiper blades and light bulbs that degrade due to normal wear and tear.

As you might expect, certain types of damage covered by car insurance policies aren’t protected by car warranties. That means that repair bills related to damage from car accidents, theft, vandalism and environmental factors fall outside of your warranty, since these can be covered by your auto insurance company.

Warranty coverage from automakers usually comes in two main forms, bumper-to-bumper and powertrain. Specific terms of these coverage types vary from one car manufacturer to another, but there are some common details.

What Does a Bumper-to-Bumper Warranty Cover?

This type of warranty is also called a basic limited warranty and covers a host of key vehicle components, including the following:

• Engine
• Transmission
• Drive axles
• Electrical systems
• Air conditioning
• Suspension
• Steering
• Differentials
• Brake system

A typical bumper-to-bumper warranty lasts for about three years or 36,000 miles, whichever comes first. The exact period of time varies by the vehicle’s manufacturer. Kia and Hyundai, for example, offer basic limited warranty coverage that lasts for five years or 60,000 miles.

What Does a Powertrain Warranty Cover?

A powertrain warranty covers the essential components that make your vehicle move. The engine, transmission and drivetrain parts are protected under powertrain coverage. Like a bumper-to-bumper warranty, this type of car warranty covers only damages incurred through normal use or from flawed workmanship.

Powertrain warranties don’t protect as much as a limited warranty, but they last longer. The average terms of a powertrain warranty are five years or 60,000 miles. Kia and Hyundai again offer longer coverage here, with powertrain protection lasting up to 10 years or 100,000 miles.

Other Car Warranty Types

New cars also commonly feature seat belt warranties, corrosion warranties and emissions warranties for parts like catalytic converters. There are generally longer coverage lengths for hybrid vehicles and for electric batteries as well.

An extended car warranty prolongs the coverage that’s provided by a factory warranty. This long-term protection takes effect once your manufacturer’s warranty expires, and can be bought from either a car manufacturer or an aftermarket provider. When purchased from an independent provider, an extended warranty is often referred to as a vehicle service contract.

There are some key differences between these two buying methods:

What Does an Extended Car Warranty Cover?

Extended warranties come with a wide range of coverage options. You can choose an exclusionary plan that’s similar to a factory warranty or opt for a basic plan that mirrors powertrain coverage. There are plenty of options in between these two coverage levels as well. Third-party warranty providers offer a wider variety of coverage options than car manufacturers.

How Much Does an Extended Warranty Cost?

In December 2022, our team surveyed 1,000 warranty owners and found that the average cost of an extended auto warranty was $3,026 in total. Prices are cheaper for powertrain warranties than for bumper-to-bumper coverage since these car warranties cover less parts.

The cost of an extended warranty depends on a wide range of factors. Here are the main contributors to what you’ll pay for a vehicle service contract:

• Vehicle type: The make and model of a car determine average repair costs and affect warranty premiums. Expect to pay more for coverage on a heavy-duty Ford F-150 than for a similar plan on a compact Toyota Corolla, for example.
• Vehicle age: Older vehicles typically cost more to cover than newer models.
• Mileage: High-mileage vehicles are more expensive to protect than cars with less wear and tear.
• Deductible: A lower deductible comes with higher monthly payments and vice versa.
• Provider: Some extended warranty companies typically offer lower rates than others.
• Coverage level: How many vehicle components you choose to protect has a major impact on the price of a plan.

Extended Car Warranty Payment Options

When you buy an extended warranty for a new or CPO vehicle from a manufacturer, you’ll likely have the option of rolling the cost into your auto loan. We don’t recommend doing so because you’ll pay interest on both the cost of the warranty and the vehicle.

Monthly payments are common for vehicle protection plans from third-party providers. You can also choose to pay for the annual or total cost of your plan upfront, with many companies offering discounts for doing so.

We encourage you to compare car warranty quotes from multiple providers before investing in a coverage plan. Endurance, autopom! and Carchex are three top-rated warranty companies that can offer peace of mind by reducing your out-of-pocket costs after a mechanical breakdown.

#1 Endurance: Best Comprehensive Coverage

Endurance offers six coverage levels including one with prepaid maintenance. That’s why we gave it our award for having the industry’s Best Comprehensive Coverage options. Each of the company’s plans come with a free year of the Endurance Elite Benefits program, which includes key fob replacement, tire repairs and total loss protection. We also like the fact that Endurance is a direct provider, meaning there’s no middleman to slow down the claims process.

Our quotes for total costs of Endurance warranty plans came in between $2,900 and $3,500. All Endurance car warranties include perks like roadside assistance, towing, rental car reimbursem*nt and trip interruption benefits for when you have a covered breakdown far from home.

Read more: Endurance Warranty Review

#2: Autopom!: Best Customer Service

Autopom! stands out for automotive peace of mind, which is the provider’s main goal for its customers. Autopom! has some of the strongest customer review scores in the auto warranty space, along with an A+ rating from the BBB. With three plan offerings covering vehicles for up to seven years or 150,000 miles, autopom! also has add-ons such as roadside assistance, towing, rental car coverage and trip interruption.

Read more: Autopom! Review

#3 Carchex: Best Industry Reputation

In our 2024 auto warranty reviews, Carchex earned third place mostly due to its strong industry reputation. It holds an A+ score from the BBB and has been accredited since 2009. Carchex also offers plans for cars with higher mileage. The provider’s longest auto warranty covers vehicles for up to 10 years or 250,000 miles. Our team found that the average Carchex warranty plan costs around $150 per month.

Read more: Carchex Review

Because consumers rely on us to provide objective and accurate information, we created a comprehensive rating system to formulate our rankings of the best extended car warranty companies. We collected data on dozens of auto warranty providers to grade the companies on a wide range of ranking factors. The end result was an overall rating for each provider, with the companies that scored the most points topping the list.

Here are the factors our ratings take into account:

• Reputation: Our research team considers availability, ratings from industry experts and years in business when conferring this score.
• Coverage: Companies that offer a variety of choices for warranty coverage, long contract terms and added benefits are more likely to meet consumer needs.
• Cost: Auto warranty companies with affordable rates and multiple deductibles scored highest in this category.
• Transparency: This score is based on contract transparency and the availability of a money-back guarantee.
• Customer experience: Based on customer satisfaction ratings and our extensive shopper analysis, we consider the responsiveness, friendliness and helpfulness of each warranty company’s customer service team.

Our credentials:

• 500+ hours researched
• 50 companies reviewed
• 2,000+ consumers surveyed