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Service Contracts & Extended Warranties

Full Video Transcript

Wondering whether you should ever buy the additional service contract or extended warranty when you buy a car or appliance? You should understand what you’d be getting before you buy one, so find out exactly what it covers and when coverage can be denied. For instance, sometimes policies don’t cover you if you don’t follow the recommended maintenance. Also, find out which company is responsible for the contract. Is it the dealer, the manufacturer or some third party? How are claims are handled? Do you need prior authorization for repairs? What is the process? If the company issuing the warranty or service contract goes out of business, what happens to your policy? Finally, you already have coverage if the manufacturer’s offers a limited warranty with the purchase of the product itself. So find out whether there is any duplicate coverage.

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