How to get a cheap extended car warranty

How to get the cheapest extended warranty

If getting a cheap warranty is your top priority, there are a few different things you can try. While these strategies may help lower your out-of-pocket costs, just know that they may not end with you getting the most value from your plan. We’ll point out cases where there’s a potential cost/value tradeoff so you can assess for yourself whether it’s worth it.

Get multiple quotes

Collecting quotes from different extended auto warranty providers may be the best overall way to lower your cost without sacrificing value.

Every extended auto warranty provider has its own way of calculating pricing for its plans, and as a result, prices for similar coverage can vary wildly between providers.

To illustrate, we collected quotes for a bumper-to-bumper plan from two top-rated extended warranty companies for the same vehicle: a 2020 Ford F-150 with 41,000 miles. olive quoted us $51.13 per month, while Endurance quoted us $90.68 per month. However, when we got quotes for a BMW 3-Series, the roles were flipped, and Endurance was cheaper.

The big takeaway here is that it’s incredibly difficult to predict who will have the cheapest warranty for your vehicle until you shop around and compare the results.

Get narrower coverage

Another reliable way to lower the cost of your extended warranty plan is to lower your total coverage.

Most extended auto warranty providers offer some variation of the same three plan types. They may go by slightly different names (e.g., “Platinum” vs. “Supreme”), but they tend to cover a similar number of parts on your vehicle.

• Platinum plans are usually bumper-to-bumper, exclusionary warranties that cover the vast majority of the parts on your car (5,000-plus), with a few dozen exceptions that are listed in the contract.
• Gold/Silver plans are usually middle-of-the-road options that cover between 400 and 600 parts across most of the component groups on your vehicle.
• Powertrain plans typically mimic your factory powertrain warranty. That means you’ll have coverage for a few dozen parts inside your engine, transmission and drive axle(s). (If you drive a hybrid, plug-in hybrid or electric vehicle, a powertrain-level extended warranty might also cover your drive unit.)

Naturally, the more comprehensive plans tend to cost more. In our experience, Platinum-level plans tend to cost 40% more than Gold/Silver plans and 60% more than Powertrain plans. However, they also tend to provide the best value since you’re getting up to 10 times the parts coverage for just 40% to 60% more money. That said, if you want the cheapest possible warranty, Gold/Silver and Powertrain plans are still viable options.

Another reason you might consider a non-Platinum plan is that you only want or need coverage for a specific part or set of parts. For example, if your vehicle is known for having engine troubles but is pretty reliable otherwise, you may only need powertrain protection.

To get an idea of your vehicle’s most common issues, you can visit owners' forums or sites like RepairPal and CarComplaints.com.

Raise your deductible

You can also raise your deductible in some cases to instantly lower the cost of your plan.

(Your deductible is the amount you pay out of pocket after your warranty provider does their part. Let’s assume your car needs a new head gasket for $4,500 and you have a powertrain extended warranty with a $100 deductible. Your warranty provider would pay the shop $4,400, and the shop would charge you $100 when you come to pick up your car.)

Just know that changing your deductible may not always be an option. Endurance, for example, has a flat $100 deductible for most plans. But others, like olive, allow you to choose between deductibles of $100, $250 and $500.

For our 2020 Ford F-150, here’s how changing the deductible affected the monthly cost of an olive Complete Care plan:

For olive’s cheapest possible plan option on our sample truck — a powertrain warranty with a $500 deductible — we were quoted just $8.18 per month plus tax.

A low-cost, high-deductible powertrain plan could well be worth it if you drive a vehicle that is known for having expensive engine problems once the manufacturer’s warranty expires. While you’ll still pay $500 for each covered repair, that’s still far less than the $4,000-plus many engine replacements cost.

Negotiate

One more way to get the cheapest possible warranty is to try negotiating with your provider. In our experience of dialing dozens of providers hundreds of times, we’ve been offered discounts of 10%, sometimes 20%, when we tried to hang up.

This tells us that certain providers may have flexible pricing and that the first price they offer you may not necessarily be the lowest offer they’re willing to make.

You can try your hand at negotiating using one or both of these methods:

1. Ask the representative on the phone if they can lower the price by a certain percentage (try 25% to start).
2. Mention a competitor’s quote for a similar plan and ask if they can match it or beat it.

If you’re able to negotiate a lower cost, be sure to get it in writing before you purchase the plan. We’ve read numerous reports of customers getting quoted a low rate on the phone but later being charged the full, pre-negotiation amount. That’s why it’s best not to assume you’ve locked in a lower price until you see it written on the contract the warranty provider sends you to sign.

How to avoid scams when shopping for cheap warranties

Scams are unfortunately common in the extended auto warranty industry, and if you’re prioritizing cheap warranties, you may be at an increased risk of encountering a scammer.

Here are some of the best ways you can detect — and avoid — an extended auto warranty scam.

• Never buy an extended auto warranty from a cold call: If you receive an unexpected call about an extended auto warranty, it’s likely a scam.
• Only purchase from legitimate sources: Make sure you trust whoever is selling you the warranty, and make sure that they are who they say they are.
• Verify callers using a simple trick: If you fill out a quote form online and receive a phone call from someone claiming to represent that provider, it’s worth checking to make sure they’re legit. The best way to be sure you’re speaking to a legitimate warranty provider is to call them back using the number on the company’s website.

» MORE: How to avoid car warranty scams

Which company has the most affordable car warranties?

While a single definitive answer would be highly convenient, the truth is that no single warranty provider is the cheapest in all cases. There are some brands — like Concord Auto Protect — that specialize in low-cost warranties, but that’s often because they don’t offer the highest levels of coverage.

The surest way to find out who’s the “cheapest” for you and your vehicle is to collect as many quotes as possible and compare the results.

» GET A HEAD START: Best extended car warranty companies