Buying a car is more than just picking out your favorite style and color.
There’s the price negotiation, the warranty to review, and the financing loan rate selection to make before even leaving the lot.
Then there’s a vehicle protection plan to consider. Vehicle protection plans are different than a warranty, though they usually have the same goal: a safeguard against potentially expensive and unexpected repairs.
Cars Protection Plus plans, also called vehicle service contracts or extended warranties, strive to maximize a driver’s peace of mind. They are offered by everyone from manufacturers and car dealerships to third-party providers.
While car insurance is a legal must for drivers, warranties and vehicle protection plans are not. But those who decide to invest in such a plan may reap some big financial rewards.
Vehicle Protection Plans: The Top Benefits
Protecting a Car’s Most Important Parts
Two commonly held vehicle protection plans are powertrain warranties, which cover a car’s vital systems and parts such as the engine and transmission, and bumper-to-bumper warranties, which are usually blanket coverage for pretty much every component in a vehicle.
The good news is that these plans will likely cover repairs on the most expensive repairs and systems that may be damaged due to age. However, both don’t cover everything.
Usually, such plans don’t cover vehicle elements such as batteries and auto glass or normal-wear parts like brake pads and rotors. But the most common car repairs are almost always covered, including fixes related to the suspension and electrical issues. Even air conditioning fixes are usually covered under these types of plans.
Deductible Flexibility and Other Perks
As with different warranties, vehicle protection plans usually come with multiple deductible options so drivers can pick one that fits comfortably within their budget.
Plans vary when it comes to perks. Some reimburse plan-holders for rental cars when their car when a repair is being made that involves a covered part.
Plans may even have you covered for up to 10 days. Vehicle protection plans increasingly include roadside assistance for emergencies all day and every day year-round.
They Help When Away from Home
Having to deal with a car repair far from home can be frustrating and nerve-wracking. But many vehicle protection plans offered by dealerships honor the plan at their own licensed repair facilities across the United States.
In addition, if there’s a vehicle issue on the road, plans may cover the travel expenses, for example up to $500 a day for 7 days related to a covered repair.
Low-Cost Compared to Repairs
A Motor1.com survey looked at dozens of types of vehicle protection plans and determined that they usually range from $2,000-$4,000 a year, with monthly rates ranging from $80-$200.
That seems like a small price to pay considering that the average cost to replace a car’s transmission is nearly $5,400. A new fuel pump can go for $1,300 and electrical issues easily get into the $1,000-$2,000 range. In comparison, a vehicle protection plan can be priceless.