What does a car warranty cover?
Even the most robust warranties only cover factory defects
“All of our vehicles come with a four-year/50,000-mile bumper-to-bumper warranty” sounds comforting, but what does a bumper-to-bumper warranty really cover? What about a powertrain warranty? And if your electric vehicle (EV) battery dies, would your warranty cover a $10,000-plus replacement?
Read on to find out.
Key insights
- Car warranties only cover factory defects — parts that fail entirely on their own due to manufacturing issues.
- Most car warranties (factory or extended) don’t cover repairs needed due to damage, abuse, misuse or neglect.
- Bumper-to-bumper warranties apply to every part of your car except a small list of exclusions; powertrain warranties only apply to select engine and drivetrain components.
- The most common exclusions are for wear-and-tear items, like brake pads and clutches, and cosmetic items, like interior upholstery.
Car warranties: What's covered?
First, it’s important to establish one thing all car warranties have in common: Auto warranties cover only repairs needed due to factory defects.
- If you’re driving along and your transmission suddenly starts lurching and won’t shift out of second gear, that repair would likely be covered under warranty.
- Similarly, if your infotainment screen suddenly goes black and won’t respond to any inputs, the repair would very likely be covered under your warranty.
We cover which parts the different kinds of warranties cover below.
The common thread between these issues is they don’t seem to have any cause. You didn’t pummel your transmission at the racetrack or pour coffee all over your center stack, and there’s no one and nothing to blame but the people who put the car together.
Automakers call the underlying issues that cause these kinds of problems “defects in materials or workmanship.” Basically, a warranty is the automaker’s promise to fix problems that shouldn’t be problems yet.
We surveyed 1,000 drivers, and only 55% of them said they knew what a warranty covered. That’s not ideal, but what’s worse is that about half of those people were actually wrong about what warranties will pay
What isn't covered by a car warranty?
Most car warranties won’t cover repairs needed due to:
- Accidents or collisions
- Weather damage
- Vandalism
- Aftermarket parts causing other parts to fail
- Misuse/abuse (like racing, off-roading or towing too much)
- Neglect (like missing maintenance or abandoning your vehicle)
Aftermarket parts in particular lead to countless claim denials. We asked a claims adjuster with Mopar, the brand that handles parts and warranties for Jeep, Dodge, Ram, Chrysler, Alfa Romeo and Fiat, about the most common reason he denied warranty claims: “Unauthorized lift kits,” he said. “If we find out that you installed a lift kit that wasn’t one of ours, we’ll automatically deny any claims for any suspension or transmission work.”
In addition to the scenarios above, car warranties generally won’t cover certain parts and services. Not even a bumper-to-bumper warranty will cover:
- Routine maintenance like oil changes and tire rotations
- Wear-and-tear items that have short, predictable life spans, such as brake pads, tires and wiper blades
- Cosmetics like leather upholstery, dashboard trim or scratches on your carbon fiber finish
- Body panels like doors, bumpers and other painted pieces (although you may get some paint protection through your factory anti-corrosion warranty, explained below)
- Any other exclusions listed in your warranty agreement
It’s important to familiarize yourself with the exclusions in your contract so that you’re not surprised later on when your claim is denied.
“It seemed like everything is covered. But when I went to go and get some stuff done, it turned out it wasn't covered,” reported a ConsumerAffairs reviewer in Georgia. “I can understand that stuff can't be paid for but with things like spark plugs -- that's not a regular everyday thing that you have to change.”
In short, even the most robust bumper-to-bumper car warranty will only cover some of your car’s parts — and only some of the time.
What kind of things would void my car warranty?
You can reasonably expect your warranty to be voided if your vehicle is:
- Flood titled
- Salvage titled
- Found with an altered odometer
- Subject to extreme environmental damage
You can see how a warranty administrator would look at a car with these issues and say, “Yeah, we definitely can’t guarantee the parts after that.”
» NEED MORE INFO? READ: What voids a car warranty?
There are also some situations that may result in denied claims but leave your remaining warranty intact, such as:
- Aftermarket part installs
- Chip installs/engine logic alterations
- Racetrack or off-road use
- Nonrated towing
- Missed maintenance intervals (e.g., delayed oil changes, bald tires)
- Damage short of a total loss
The key difference is that, in the first list, it’s reasonable to assume that every part of the car has been affected, and as a result, factory quality can’t be guaranteed.
But, in the second list, only some of the areas of the car may be impacted, and therefore it wouldn’t be right — or, in some cases, even legal — to void your entire warranty.
The Magnuson-Moss Warranty Act established standards for when warranty companies can actually void coverage.
For example, if you’re 2,000 miles late for an oil change, your warranty provider may deny your claim for an engine repair, but they shouldn’t deny your claim for a sunroof repair. Similarly, if you install a custom engine part, you run the risk of your warranty provider denying all powertrain-related claims. But no matter how much horsepower you add, they shouldn’t deny claims for a dead infotainment system.
The key takeaway is this: Even if something doesn’t void your warranty altogether, it may effectively “void” coverage for certain areas of your car. So approach aftermarket parts and off-roading/racing with caution.
Types of car warranties
There are a few different types of car warranties, and different coverages are available from each one. We’ve broken down the various options below, but contract details may vary, so it’s always best to read any warranty agreement carefully before you buy.
New car warranties
Also known as manufacturer's warranties or factory warranties, new car warranties are included with all brand-new vehicles.
The minimum new car warranty term is three years/36,000 miles, which means the warranty lasts until the vehicle is three years old or has 36,000 miles on its odometer — whichever comes first. However, some car makers offer considerably more.
» SEE WHO DOES IT BEST: Best new car warranty
Factory warranties always follow the car, not the owner — so if you buy a used car that’s two years old and has 20,000 miles on the odometer, it should have some factory warranty left, barring any warranty-voiding misfortunes.
Most new cars actually come with multiple warranties that are designed to cover different parts of your vehicle for different lengths of time:
- Bumper-to-bumper warranties: Bumper-to-bumper warranties cover practically every part between your bumpers (minus the kinds of exclusions we mentioned earlier). You may also see them listed as “basic” or “limited” warranties. Technically, they cover every part except the ones listed under the exclusions in your contract, so be sure to read that section carefully.
- Powertrain warranties: Powertrain warranties typically cover your engine, transmission and drive axle (the part that brings torque to the wheels), as well as other essential components that make the car go. Powertrain warranties often outlast bumper-to-bumper warranties, though. Some, like Hyundai’s, go as long as 10 years/100,000 miles.
- Hybrid/EV battery warranties: These cover the big, main battery powering your hybrid or electric vehicle and certain other battery-related components. They typically guarantee the battery will keep working and retain 70% maximum charge up to a certain number of years or miles, typically around eight years/100,000 miles.
- Emissions/rust/corrosion warranties: These warranties cover very specific scenarios or component groups, such as rust underneath the car or your emissions system.
Certified pre-owned warranties
Certified pre-owned (CPO) warranties are coverage plans manufacturers or individual dealerships may include with a certified pre-owned vehicle purchase. They’re typically bumper-to-bumper warranties lasting two years/24,000 miles or less.
If you’re interested in buying a certified pre-owned vehicle, check out our breakdowns of different manufacturers’ CPO programs to see how your choice stacks up:
Extended auto warranties
Extended auto warranties, also known as vehicle service contracts, are optional warranties that give you coverage beyond what your factory warranty offers. A common term length for an extended warranty is seven years/100,000 miles, meaning it would extend a four-year/50,000-mile factory warranty by another three years/50,000 miles.
You can purchase extended auto warranties from the manufacturer of your vehicle, like Honda, or from a warranty company, like Endurance. Some automakers require you to purchase your extended warranty before the factory warranties run out, while third-party companies are generally more flexible. As you might expect, the price of an extended warranty tends to rise as your vehicle ages.
In most cases, bumper-to-bumper coverage offers the best bang for your buck.
Extended warranty coverage options vary considerably, but here are the main three categories you’ll see:
- Platinum/Diamond/Supreme plans are generally bumper-to-bumper-equivalent plans, but be sure to read the fine print before you buy.
- Gold/Silver plans typically offer something in between bumper-to-bumper and powertrain, with coverage for a few hundred parts.
- Powertrain plans are pretty much a direct extension of your factory powertrain warranty, with coverage for a few dozen engine, transmission and drivetrain-related components only. Some companies offer Powertrain Plus plans that sprinkle in coverage for a few other components, too.
While the Gold/Silver plans may sound like the best value, based on our experience pricing out hundreds of extended auto warranties from top-ranked providers, bumper-to-bumper plans tend to be the best overall value because they cover hundreds or thousands more parts for around 10% to 40% more.
In fact, we spoke to around 15 dealerships representing various automakers that told us they no longer sell Gold- or Powertrain-equivalent extended auto warranties because so many customers ended up dissatisfied with how many repairs weren’t covered.
When is extended warranty coverage worth it?
So, is it worth paying thousands of dollars to extend your factory warranty? It depends.
In general, an extended auto warranty is more likely to be worth it if:
- You drive a vehicle with below-average expected reliability.
- The cost of extended warranty coverage is less than you expect to save on covered repairs.
- A surprise repair bill could be financially ruinous.
- You don’t mind paying a few thousand dollars for extra peace of mind.
You can get an overall idea of your vehicle’s expected reliability from J.D. Power’s annual U.S. Vehicle Dependability Study. Then you can see how much repairs might cost from tools like Kelley Blue Book’s 5-Year Cost to Own tool, Edmunds’ True Cost to Own (TCO) tool and RepairPal’s estimated annual repair cost.
Compare those costs to how much an extended warranty would cost you (we recommend getting quotes from multiple warranty providers) to decide whether an extended warranty is financially worth it for you.
FAQ
What should I look for when comparing car warranties?
Keep a close eye on costs, coverage and company reputations. A warranty is no good unless the company is known for paying out claims in full and on time.
Can I transfer my car warranty to a new owner?
If your vehicle is still under factory warranty, the remaining warranty amount should transfer automatically. Most extended auto warranties can be transferred to new owners, though you typically have to fill out paperwork and pay a transfer fee of around $50 within 30 days of the sale.
What’s the difference between a warranty and a recall?
A warranty is passive protection against factory defects. A recall is an acknowledgment of a known, widespread issue affecting certain models and years. Recall repairs are free and often safety-related, so it’s best to schedule your recall repair work as soon as possible.
What happens to my warranty if I modify my vehicle?
Most modifications won’t instantly void your warranty, but they may result in claim denial for any parts or systems the aftermarket part affects. For example, if you install a lift kit without your warranty provider’s approval, all claims for engine, suspension and transmission repairs may be denied if the lift kit can be implicated as the cause.
How will warranty companies know if I abused, misused or neglected my vehicle?
The telltale signs of neglect, abuse or misuse can be easy to spot for trained technicians and experienced claims adjusters. Excess clutch wear, worn-out brakes, balding tires or a carved-up undercarriage are all signs the vehicle may have been tracked, taken off-road, or otherwise abused or misused.
Neglect is much easier to define; if you can’t provide maintenance receipts, warranty companies may simply assume the vehicle has not been properly maintained as outlined in your manual.
Are car warranties voided if I miss a scheduled maintenance?
Warranties aren’t instantly voided in most cases, but your warranty provider may deny claims for parts related to the missing maintenance. If you miss an oil change, for example, your provider may deny claims for engine-related repairs.
Article sources
- U.S. Bureau of Labor Statistics, “ Table 2. Consumer Price Index for All Urban Consumers (CPI-U): U. S. city average, by detailed expenditure category.” Accessed May 10, 2023.
