Car warranty guide: what you need to know

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    Car warranties can save you money, time and stress — but only if you understand how they work. In fairness, they’re not self-explanatory. (Despite its name, a bumper-to-bumper warranty generally doesn’t include your bumpers or all the components between them.)

    That’s why we’re breaking down everything you need to know about car warranties, including what they are, what they cover, how they work and when an extended warranty might be worth it.

    Key insights

    • A car warranty is almost like breakdown insurance — it’s designed to protect you from surprise repair bills resulting from defective parts or workmanship.
    • Car warranties cover parts that fail on their own but not as a result of damage, vandalism, abuse, neglect or misuse.
    • Almost all new cars come with multiple warranties, but two of the most important to understand are bumper-to-bumper and powertrain coverage.
    • Extended warranties let you keep your car under warranty coverage as it gets older, but you’ll have to decide if they’re worth it for your situation.

    What is a car warranty?

    Put simply, a car warranty is a contract between you and the warranty issuer in which it agrees to cover the cost of certain repairs. Issuers can be car manufacturers, like Ford or Toyota, that want customers to feel secure in their purchases or third-party warranty providers that offer coverage to complement or extend factory warranties.

    Repair bills commonly range anywhere from a few hundred to a few thousand dollars, so having a good warranty can protect your savings and provide peace of mind. Fortunately, new cars come with factory warranties that last for at least three years or 36,000 miles from the date of purchase — whichever comes first.

    » LEARN: Car warranty vs. car insurance

    What do car warranties cover?

    As a general rule, warranties only cover parts that fail on their own. The official language in a warranty agreement often refers to covering “defects in design or workmanship,” and this essentially translates to “breakdowns that aren’t your fault.”

    Things get more complicated when you start looking at specific coverages, though. Different types of warranties cover different things, and the exact terms of a warranty can vary from contract to contract. We can’t explain the terms of every single warranty agreement here, but we can give you the basics of what the different types of warranties cover.

    Types of warranties

    Here’s a breakdown of the most common types of car warranty coverage you’ll see on the market today.

    Sometimes referred to as a limited, exclusionary or comprehensive warranty, a bumper-to-bumper warranty covers most — but not all — parts of your car.

    Bumper-to-bumper warranties are typically “exclusionary,” meaning your warranty coverage will extend to every part of your vehicle that isn’t specifically excluded in your contract, so be sure to check your paperwork before assuming everything on your car is covered.

    A powertrain warranty covers everything essential to making your car go, including your engine, transmission, drive shaft, fuel pump and the other components of your drivetrain. Powertrain warranties typically last much longer than bumper-to-bumper warranties, with some ranging as high as 10 years or 100,000 miles from the purchase date on new vehicles.
    This type of warranty covers repairs for damage caused by naturally occurring rust on factory components. It often consists of two main components:
    • A surface-corrosion warranty, which deals with surface rust on paint and other sensitive components
    • A rust-perforation warranty, which deals with parts on your chassis that rust all the way through
    Not to be mistaken for a normal battery warranty, which covers the roughly $200 battery in most vehicles, a hybrid/EV battery warranty covers the vastly more expensive traction battery pack in a hybrid, plug-in hybrid or electric vehicle (EV).

    Hybrid/EV battery warranties typically guarantee that your traction battery will carry at least 70% charge for a certain time, commonly eight years or 100,000 miles. Considering the cost of replacing a traction battery can be anywhere from roughly $4,500 for a Toyota Prius to over $15,000 for a Tesla Model S or Nissan LEAF, this type of warranty can be even more valuable than bumper-to-bumper coverage.

    Most manufacturers offer accessory warranties for original equipment manufacturer (OEM) parts installed at an approved facility. Toyota, for example, includes a one-year/unlimited-mile warranty on its parts. So, if you have your Toyota dealer install a TRD performance exhaust on your car and it fails within a year, it'll replace it free of charge.

    You may see these types of coverage in the following categories:

    New car warranties, also known as factory or manufacturer warranties, come with most new cars and some certified pre-owned (CPO) cars. A manufacturer’s warranty is typically broken down into bumper-to-bumper, powertrain and anti-corrosion coverage. However, it can also include a separate warranty for accessories.

    Certified pre-owned warranties are short warranties that some manufacturers include with the sale of their CPO cars. Lexus, for example, includes a two-year/unlimited-mile bumper-to-bumper warranty with its CPO vehicles that can stack onto the vehicle’s existing factory warranty.

    Extended warranties, also called vehicle service contracts, are generally designed to “extend” your factory warranty past its original expiration date. For example, if the original bumper-to-bumper warranty on your Audi expires after four years or 50,000 miles, you might consider purchasing an extended warranty to last through your ownership (say, eight years or 100,000 miles) so you’re not on the hook for luxury car repair bills, which tend to be more expensive than repairs on cheaper vehicles.

    Extended warranties aren’t always an extension of your factory warranty, though. Some extended warranties offer so-called wrap coverage that coexists with and complements an existing warranty.

    » MORE: What does a car warranty cover?

    What don’t car warranties cover?

    Because car warranties are generally designed to cover parts that fail on their own due to poor design, manufacturing mistakes or improper fit, they won’t cover breakdowns resulting from damage, abuse or neglect, including:

    • Damage caused by a road accident, bad weather, vandalism or animals
    • Malfunctions resulting from missed maintenance, especially oil changes
    • Problems that occur after off-roading or racing, unless otherwise stated in the warranty terms
    • Otherwise-covered parts that fail as a result of aftermarket modifications, such as a lift kit damaging your suspension

    So, if the warranty issuer peers at your maintenance records and sees that you haven’t changed the oil in 30,000 miles, it may deny your claim to fix the engine. Similarly, if you blow a head gasket at the racetrack, the issuer will likely deny your claim for repair.

    “The consumer should take time to review what is or is not covered by the auto warranty,” said Allison Harrison, a lawyer with ALH Law Group in Columbus, Ohio.

    “Usually when purchasing a warranty or service contract, there is a one- or two-page form that outlines the basics of what is covered, what is not and how long the coverage is for,” she said. “It is important to look at what is covered.”

    It’s worth mentioning that warranties also typically don’t cover:

    • Routine maintenance, like oil changes and tire rotations
    • Normal wear-and-tear items, such as tires, brakes and lightbulbs (tires may come with their own separate OEM warranty, though)
    • Cosmetics, such as interior trim and upholstery
    • Excessive road noise or vibrations, unless they can be traced back to a manufacturer defect
    • Preexisting issues (for extended warranties)
    • Any part or system listed under “exclusions” in your warranty agreement
    An inspection can help you prove your issue didn’t exist before coverage started.

    Consumers are often surprised to have warranty claims denied due to the issue being preexisting. However, there’s an easy way to avoid this in many cases.

    Harrison advised drivers to “have the vehicle inspected at a reputable shop prior to buying the coverage. … Then, if the company attempts to deny coverage, you have proof that the issue was not preexisting.”

    Even with brand-new vehicles, the line between what’s covered and what’s not covered under warranty can be blurry and subject to a conversation with your claims officer. For example, when the owner of a 2022 Toyota GR86 totaled his engine during a track-day event, he successfully argued with Toyota that taking such a track-focused vehicle to the track should constitute normal use. The company (eventually) agreed and covered his $11,000 engine repair.

    How a car warranty works

    When you’re looking to get a repair done under warranty, it’s never too soon to call your warranty provider and ask how to proceed. In most cases, you’ll be instructed to:

    1. Take your car to the nearest licensed mechanic.
    2. Get a diagnosis and a quote for the repair.
    3. Call your warranty company back so it can authorize the repair.

    Still, we recommend calling first because some warranty companies have a specific list of approved repair centers. Some manufacturers may even require you to take your car back to the dealership where it was first purchased — especially if the repair requires specialized parts and labor.

    Car warranty vs. extended car warranty

    As we mentioned earlier, extended car warranties can extend or complement your factory warranty, but there are a few key differences:

    • Extended warranties can be issued by the OEM or a third party, but factory warranties are always issued by the OEM. For example, as the three-year/36,000-mile factory warranty on your Mazda CX-5 nears expiration, you might consider Mazda’s Platinum Vehicle Service Agreement or a warranty from a third-party provider.
    • You have to pay for an extended warranty, while factory warranties come with your vehicle purchase. (The cost of a factory warranty is likely factored into your vehicle’s price tag, though, which makes it difficult to compare with the cost of an extended warranty.)
    • Extended warranties can have deductibles ranging from $0 to $500, but factory warranties don’t have deductibles.
    • Extended warranties can stretch up to 300,000 miles, which makes them good for high-mileage vehicles. The longest factory bumper-to-bumper warranty on 2023 vehicles ends after five years or 60,000 miles.
    • Extended car warranties can be more convenient. Third-party vehicle service contracts are highly customizable and often have a longer list of approved repair centers than factory warranties.

    If you’re interested in purchasing an extended warranty, just be sure to avoid scams and choose the right warranty for your needs. Extended warranty companies don’t have the established reputations that major automakers do, so it can be difficult to navigate the third-party warranty market without some help.

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      Do second owners get warranty coverage?

      Factory car warranties typically transfer to second owners automatically, since the warranty is tied to the car’s vehicle identification number (VIN). However, some manufacturers may reduce the factory warranty term for successive owners.

      Extended warranties often require fees and paperwork to transfer to a new owner, but it’s still possible.

      Do I get a warranty on a certified pre-owned car?

      In most cases, you should get a warranty on a certified pre-owned car. Once the vehicle is certified, manufacturers typically include a one- to two-year bumper-to-bumper warranty.

      Who has the best new car warranty?

      According to our analysis of the best new car warranties in 2023, Hyundai, Mitsubishi and Kia tie for the longest bumper-to-bumper and powertrain warranties. All three automakers include a five-year/60,000-mile bumper-to-bumper warranty and a 10-year/100,000-mile powertrain warranty with 2023 vehicles.

      Will installing aftermarket parts or modifications void my warranty?

      Federal law prohibits warranty issuers from voiding your warranty simply because you installed a modification or aftermarket part. However, if they can prove that the installed part directly led to the failure of another part, they can deny your claim.

      For example, if you install a lift kit on your truck, the company can’t void your warranty for your infotainment system — but it may deny claims for your suspension.

      ConsumerAffairs writers primarily rely on government data, industry experts and original research from other reputable publications to inform their work. Specific sources for this article include:
      1. Road & Track, “Toyota Has a Change of Heart, Covers Warranty Repair for Blown GR86 Engine.” Accessed Feb. 14, 2023. 
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