I just bought a 2002 s60 AWD turbo with 75,000miles on it. It has a extended warranty on it for the next 8 months, but I was wondering wether a third party warranty was worth the cost/piece of mind. Any thoughts or suggestions?

 

You need to be very very careful with third party warrenties. Most are not gonna cover much. which is why they are cheap. You can get one through the dealership i think, also check with some good credit unions. sometimes they offer really really good ones. In the end go with what will cover you best. but do your homework, or you will regret it later.

 

I looked around after I bought my S60 in June.

Most companies wanted $3-4000 to cover to 90,000 miles.

No thanks.

In my experience, these people are crooks anyway. They'll do anything they possibly can to avoid paying a claim. I mean, if you get your 60,000 mile service at 61,000 miles, then file a claim, that right there is a reason to deny you. After all, shame on you for not following the service recs, even if the broken part had nothing to do w/ the service.

Generally, they're a huge rip-off. The only exception is a MANUFACTURER extended warranty.

Here's what I did, and I advise you (and everyone else) to do the same:

Go to your local bank, open up a Money Market account. Change your direct deposit to put $150 a month (or what you can afford) into the account. It'll usually earn about 5%, it is FDIC insured, and there are no penalties for withdrawal like you get w/ a CD. Use the cash for repairs or for a down payment in the future should you decide that reparing the car isn't in your best interest.

These warranty companies make a healthy margin. That's because for the vast majority of people, they make more in premiums than they pay in repairs. You know, it COULD pay off incredibly. You could have a $2000 contract and six months later need a $3500 tranny or something. But probably not. So take a gamble and have the peace of mind that in 2 years when you hit 100k, you'll have about $3000+ in there for incidentals.

Good Luck!

 

Thanks for the inputs. I have looked into a few and one(through a broker)was offering pretty extensive coverage, but the "following the factory requirements" made me a little worried. The broker even admitted that the companies look for a reason to not pay claims. For $2300, the would give me a 4yr/60k miles if I buy it before 80k miles, but there would still be $100 deductible. The credit union seems like the way to go.

 

Love my s60 is right they are a rather large rip off.

If your gonna do it and go between the manufacturer or the bank. Its good to have a place to go to talk with them directly, Third party, is usually some hole in the wall, in bumsville idaho. See what your manufactures warrenty is and compare it to bank then post and show.

 

While working at a Volvo dealership's service department recently I saw the problems people have with third-party warranties. One customer needed a new transmission at 90k miles, and the warranty company initially refused to let us order a new tranny from Volvo. Three inoperable junkyards trannies and one month later they gave in, but the customer had to pay for a rental car in the meantime. If he had purchased Volvo's extended warranty we would have provided a free loaner and had his car fixed in three days.