Extended warranty, Good deal?

We bought an extended car warranty from our Toyota dealer. We go got 2 used cars from them, both Pathfinders. The company is Signet Financial Group, Western Region. The extended warrany covers the same items originally covered by the manufacturer. It does not cover wear and tear on the parts, just original defects.

One car is an '07 has about 20K miles on it and takes the car out 5 years past manufacturers warranty at 15K miles per year. The other is for an '03 with 70K miles on it. It goes for 4 years at 12K miles per year. Both cost 2500 each. They "threw in" a refund clause that states that if you do not use the warranty, you can get the full amount of money back if you file within 30 days of the last day the warrany is over (I imagine most people do not meet this tight and oft forgotten deadline) Toyota dealer said the warranty on the 03 was a particularly good deal and that I should not cancel this.

I am questioning whether we should have purchased these. I am told we have 30 days to back out of the warranty. I feel that the extra $5000 is a bit high and that maybe we could have gotten a better deal.

1) Anyone know anything about Signet and how can I find out about its rating score? 2) After $70K miles, how much of repairs can be attributed to defective parts as opposed to wear and tear. Instinct tells me most of the parts and labor at this point is wear and tear. 3) What other relaible companies give good deals on extended car warranties?

Any and all advice welcome.

Deb

Reply to
Debbiedo
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RUN AND GET YOUR MONEY BACK!! This is a total rip-off.

At a minimum, tell the dealer you would CONSIDER it for $1000 total - but even this is to much.

sc

Reply to
Scott C

Yes, it was definitely was a great deal. For the Toyota dealer. They make a huge profit. I wouldn't be surprised if it is $1500 for this insurance (it is an insurance policy you bought). It is a great deal for Signet, the insurance companies that actually cover this, the agents that sell to the dealers. In fact, it a great deal for everyone, except you.

Chances are that at the end of the warranty period, $5000 won't be spent on repairs for both trucks (they're trucks, not cars). So you're better off getting your money back and putting it in the bank. In the bank, you'll have about $5800 at the end of four years if nothing goes wrong.

Signet doesn't have a ratings score. Rather, it is just a broker and service company. The insurance is supplied by other companies.

Sounds like a great way to deny your claim, doesn't it?

Most trucks go beyound the extended warranties without major repairs. And sometimes, when there is a repair to be made, the auto maker will have a TSB or other program where at least part of the cost is covered.

Other? What makes you think that Signet is a reliable company? Did you contact the BBB before buying? Did you see if there are a lot of complaints about this company?

Extended warranties are a profit center for the dealers. They make a lot of money on them for little work. You're almost always better off not buying the extended warranty and keeping the money in the bank as a down payment for the next car (or in this case truck) you buy. The agent gets his cut, so does Signet. And the insurance company that actually insures the truck makes a profit, too. Don't forget, the insurance won't add value to the truck when you go and sell it. And, if the truck is wrecked, you won't get your money back.

The best bang for your buck is in the bank, earning interest for you, not commissions for the agents, dealer or Signet.

So go back to the dealer and get a nice check back.

Jeff

Reply to
Jeff

Check

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and see how it compares. Chuck

Reply to
Chuck Olson

I want to add, I just bought a 08 Prius. The finance guy started at $1600 for a 7 year 75K mile extra warranty - which is 4 years and 40K miles EXTRA to the 3 year 36K mile.. so you are really not buying a 7/75K as you already have a 3/36K on a new car. I told him this was a HUGE money maker for him, I know this, he knows this, right away, he says, OK what if I can get it to you for $900! I smiled, I'll give you 750 for a 6/75 period. Take it now or let's move on! He came back with, would you pay an extra $50 for a 7 year /

75K mile, 'sure'.. deal done.. and I still got ripped off.. but with this new technology (a hybrid), I did not mind this extra.. but I still got ripped off.

Please, get your money back if you can, or at least get it for 1/4 - 1/2 the price you paid.. !!

sc

Reply to
Scott C

The funny thing is that your Prius's new technology (the hybrid system) is already covered for a longer warranty than the one you got ripped off for.

In almost every case, people are better off putting the money they would have used to pay for the insurance (it's not a warranty) and collecting interest. In the end, they are almost always richer.

Jeff

Reply to
Jeff

Get your money back. THe only service agreement worth buying is from the manufacture of the car. Check on line for pricing. You were ripped off.

Reply to
Art

The extended "warranty" is actually a service contract, which is an insurance policy. In my experience, policies offered by aftermarket companies like Signet are usually so full of loopholes that they cover very few repairs. Extended service contracts are generally not a good deal for the consumer, but if you want some peace of mind, get the Toyota ExtraCare service contract or a Nissan contract.

Reply to
Ray O

I disagree. You don't need to buy this insurance at all, even if it does come from the automaker. And it really is insurance. The automaker sells it to make more money.

Jeff

Reply to
Jeff

I have an associates degree in automotive technology that I aquired in the early 80's. A friend who graduated near the time I did now owns an automotive warranty company.

His building has no windows and there are cameras that cover the entire exterior of the building. You have to be buzzed in to get inside the heavy 'steel' door.

Does this give you an idea how many claims are actually paid by these companys and what the profit margins are..?

Back then, he used to spend hours on a computer flight simulator because he loves airplanes. He now flies the real thing thanks to people like you...

CP

Reply to
Charles Pisano

When it comes to vehicles, 99% of the time, extended warranties are for suckers. The ONLY time I got such a warranty, back when I was naive, was for a new 1985 Hyundai Pony (I'm in Canada). International Warranty was the warrantor and it paid off at least 3 times MORE than I paid for it. (About $400) They eventually went bankrupt but Hyundai honoured the terms for the rest of the warranty period. They had to replace such things as most of the engine seals several times. Lots of labour.

Reply to
sharx35

I used to sell maintenance contracts for one of the major 2-way radio manufacturers. The company made more, taking 15% off the top and subcontracting the maintenance than they made from the sale of the radio. That should tell you something about the value of maintenance contracts / extended warranty contracts. They are a great deal for the seller and a lousy deal for the buyer.

Get your money back.

Jack

Reply to
Retired VIP

I'd rather pay for some thorough inspections by an independent mechanic rather than for any extended warranties, especially at those prices and especially because the warranties are not being offered by Toyota but by a separate company. The independents are infamous for denying claims (everything turns out to be an excluded "normal wear item", sometimes including head gaskets), stalling on repairs (problem has to be checked by their inspector, major parts sent out to their supplier), or requiring that their cheapo parts be used instead of factory parts or parts preferred by the mechanic.

The profit margins on extended warranties are huge, and it wouldn't surprise me if the dealer makes more from the warranty than frin selling the products. That's the case with the appliance business, where the majority dealers would be losing money if not for extended warranties.

I generally dislike extended warranties and would never buy one fir a new or used car, but I did get one for my central A/C, and it's paid out 5-8x if its cost, so far.

Reply to
larry moe 'n curly

every time a dealership tries to sell me extended warrentys on the car, this includes a scam for extra coating to preserve the paint, I say, you have to be kidding, If the car fails to meet expectations or the paint looks like doo doo, it's a reflection of car quality, which I will be sure to share on the internet. I found out the hard way to deal with a factory reject, not quite a recall but close, and threatened to take the issue to the HQ and I instantly got the repairs necessary. But found out about the defect on the net, and followed their instructions on getting the problem resolved.

Reply to
kahubbard

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