Warranties: considering skipping extended warranty. Here's why...
10-02-2004, 03:14 PM
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Warranties: considering skipping extended warranty. Here's why...
1. Few firms are writing in California. But my favorite one does: Warranty Direct, which is essentially the retail unit of one of the biggest and best underwriters. They seem to talk straight and offer the best coverage.
2. Pricing is rather high. Full California Mechanical Breakdown Insurance is $3757 for the top coverage, 4 years/100,000 miles. This includes failures traceable to wear and tear and to overheating, and covers more than any other I've seen.
They offer "big ticket items" coverage for $2456. This will cover computers and such, whereas most other companies do not. Still, that's a lot, given that most repairs won't be such big ticket items.
3. Warranty coverage of any kind can be voided where modifications are made. I may want a Tip chip and coilovers in the near future.
4. The Audi dealership offers a "Platinum" exclusionary policy that does NOT cover failures traceable to wear and tear that occurs after 50k miles (how the hell can they tell anyway?). Thus, worn window guides or seals may be refused, for example.
5. Warranties are a hassle to use, requiring pre-authorization in most cases. This can sometimes result in a day's delay.
6. The Audi coverage (sourced from Fidelity of Florida) will basically tie me to the dealership for repairs, where I will end up paying about one-third more per hour for any non-covered repairs done at the same time.
It also probably ties me to the dealership for maintenance (in order to have a credible record of proper maintenance), which can get pricey. I've visited DM Motors in Palo Alto and probably will use them for service in the future, at $85/hour.
7. My car has been well cared for, and the 4.2 model is rather reliable. I expect fewer problems than the average Audi. With proper fluid changes and care, the big ticket engine and transmission should survive a long time.
8. The Warranty Direct rep says they tend to pay out 75-125% of their warranty cost in repairs, but where they make their money is by investing the cash you've given them up front. I figure I, too, can benefit by keeping that cash.
9. On the other hand, a warranty protects you against large downside risk, like catastrophic failures that are expensive. Also, most are transferrable or cancellable with a pro-rata refund. They can help in selling a car, but I doubt you will get full value back for it.
OK, discuss amongst youselves....
2. Pricing is rather high. Full California Mechanical Breakdown Insurance is $3757 for the top coverage, 4 years/100,000 miles. This includes failures traceable to wear and tear and to overheating, and covers more than any other I've seen.
They offer "big ticket items" coverage for $2456. This will cover computers and such, whereas most other companies do not. Still, that's a lot, given that most repairs won't be such big ticket items.
3. Warranty coverage of any kind can be voided where modifications are made. I may want a Tip chip and coilovers in the near future.
4. The Audi dealership offers a "Platinum" exclusionary policy that does NOT cover failures traceable to wear and tear that occurs after 50k miles (how the hell can they tell anyway?). Thus, worn window guides or seals may be refused, for example.
5. Warranties are a hassle to use, requiring pre-authorization in most cases. This can sometimes result in a day's delay.
6. The Audi coverage (sourced from Fidelity of Florida) will basically tie me to the dealership for repairs, where I will end up paying about one-third more per hour for any non-covered repairs done at the same time.
It also probably ties me to the dealership for maintenance (in order to have a credible record of proper maintenance), which can get pricey. I've visited DM Motors in Palo Alto and probably will use them for service in the future, at $85/hour.
7. My car has been well cared for, and the 4.2 model is rather reliable. I expect fewer problems than the average Audi. With proper fluid changes and care, the big ticket engine and transmission should survive a long time.
8. The Warranty Direct rep says they tend to pay out 75-125% of their warranty cost in repairs, but where they make their money is by investing the cash you've given them up front. I figure I, too, can benefit by keeping that cash.
9. On the other hand, a warranty protects you against large downside risk, like catastrophic failures that are expensive. Also, most are transferrable or cancellable with a pro-rata refund. They can help in selling a car, but I doubt you will get full value back for it.
OK, discuss amongst youselves....
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10-02-2004, 09:09 PM
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Seriously consider skipping extended warranty.
Another thing to consider... these companies all write in their coverage that the aggregate total of all repairs may not ever exceed the current left hand book on the vehicle. One could find themselves without coverage depending on the total of accumulated repairs and the current left hand book value.
Having to hassle with them is the other real major reason to not insure with them.
Not a good bet to buy from these guys... self insure, it is the wiser choice.
Having to hassle with them is the other real major reason to not insure with them.
Not a good bet to buy from these guys... self insure, it is the wiser choice.
10-02-2004, 09:24 PM
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Bought my ext. warranty through Carlsen in Palo Alto...
from a company called National Auto Care. Covers 4yrs/48000mi from date of purchase for $1895.
So far they've paid for:
- Master window switch $156
- Two oxygen sensors $724
- Instrument cluster $765
- rental cars
So it's pretty much paid for itself already and I still have 20Kmi left. And none of the issue was turbo related. You might want to give them a call.
00 2.7T Tip
So far they've paid for:
- Master window switch $156
- Two oxygen sensors $724
- Instrument cluster $765
- rental cars
So it's pretty much paid for itself already and I still have 20Kmi left. And none of the issue was turbo related. You might want to give them a call.
00 2.7T Tip
10-03-2004, 12:03 AM
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Re: Warranties: Some good points you made...
However, consider the following in your discussion:
1) auction cars or non-certified vehicles over 80K miles along can cost considerably less and provide good service at a cost-effective price. Audi Certified adds about $7400 average to 2.7t model. Given the rate of component failure on obscure systems (the "LED" panel in the dash for instance), or additional system maintenance of an estimated $2000 per year at 20K miles without the warranty, then a 2 year ownership leaves you with a figure of about $1600 +,- to contend with catastrophic failures such as Turbo's, blower motors on Clim/Control systems, heater valves, and the possible W/P failure in case you cannot confirm maintenance required items such as the T/Belt replacement due to "Privacy" concerns by a dealer. These real-world factors are never discussed in a sale, but you might figure the outlay as actually for $1600 more than your purchase price, but put an actual 5K back into your pocket by going with the warranty. Yes..it does cost to cover wear and tear items, big time. I just forked over $2000 for suspension renewal on a car with 130K which was going bad, I believe at around 83K when I bought it. I just didn't have experience enough to tell the difference. Maybe if your car never fails you could save the $3000, but it isn't likely with a majority of these types of cars. IMHO.. Ty for the chance to discuss this topic. IT is central to the issues of owning a higher performance vehicle like Audi.
1) auction cars or non-certified vehicles over 80K miles along can cost considerably less and provide good service at a cost-effective price. Audi Certified adds about $7400 average to 2.7t model. Given the rate of component failure on obscure systems (the "LED" panel in the dash for instance), or additional system maintenance of an estimated $2000 per year at 20K miles without the warranty, then a 2 year ownership leaves you with a figure of about $1600 +,- to contend with catastrophic failures such as Turbo's, blower motors on Clim/Control systems, heater valves, and the possible W/P failure in case you cannot confirm maintenance required items such as the T/Belt replacement due to "Privacy" concerns by a dealer. These real-world factors are never discussed in a sale, but you might figure the outlay as actually for $1600 more than your purchase price, but put an actual 5K back into your pocket by going with the warranty. Yes..it does cost to cover wear and tear items, big time. I just forked over $2000 for suspension renewal on a car with 130K which was going bad, I believe at around 83K when I bought it. I just didn't have experience enough to tell the difference. Maybe if your car never fails you could save the $3000, but it isn't likely with a majority of these types of cars. IMHO.. Ty for the chance to discuss this topic. IT is central to the issues of owning a higher performance vehicle like Audi.