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What Is a Used Car Warranty? (2023 Buyer’s Guide)

Oct 17, 2023

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In this article, we at the MarketWatch Guides Team will explain what a used car warranty is and how your coverage plan works. We’ll also explain what a used vehicle warranty covers and share quotes from some of the best extended car warranty companies. If you’re looking for the best rates on a vehicle protection plan, we suggest comparing quotes from multiple extended coverage providers that offer higher age and mileage limits.

The MarketWatch Guides Team is committed to providing reliable information to help you make the best possible decision about a warranty for your vehicle. Because consumers rely on us to provide objective and accurate information, we created a comprehensive rating system to formulate our rankings of the best extended car warranty companies. We collected data on dozens of auto warranty providers to grade the companies on a wide range of ranking factors. After 500 hours of research, the end result was an overall rating for each provider, with the companies that scored the most points topping the list.

Learn more about our methodology.

A used car warranty offers exactly what you’d imagine: long-term coverage for used vehicles. Plans come in various forms, from third-party factory warranty extensions to certified pre-owned (CPO) warranties offered by car dealerships.

In either case, used car warranties cover the cost of repairs to or replacements of a predetermined set of vehicle parts. If your car breaks down, you can take it to any repair shop certified by the National Institute for Automotive Service Excellence (ASEⓇ). If necessary repairs are covered by the warranty, your provider or administrator will pay the repair facility directly minus the deductible.

A used car warranty is relatively similar regardless of where you purchase the coverage plan. Still, it's worth knowing the differences between used car factory warranties, CPO warranties and used car extended warranties.

A factory warranty is a coverage plan backed by the car dealership where the used vehicle was bought. It's a guarantee that the dealer will cover certain car parts should they break down after the purchase.

Note that new vehicle limited warranties typically last for only three years or 36,000 miles, meaning that most used cars aren't under coverage anymore. Also keep in mind that factory warranties don't cover either regular maintenance needs like oil changes and tire rotations or wear and tear items like brake pads and windshield wiper blades.

A certified pre-owned car is a model that the automaker thoroughly inspected and guarantees to be in working condition. Each car manufacturer sells and backs its own CPO warranty plan.

An extended used car warranty is a vehicle service contract offered by a third-party provider. Like any vehicle protection plan, an extended warranty covers car repairs to and replacements of parts that fail due to a mechanical breakdown. Some companies specialize in extended warranties for cars with over 100k miles. While many third-party warranty providers can prolong your manufacturer's plan, true extended car warranties come from car manufacturers.

Unless you’re purchasing a CPO vehicle from an auto dealer, expect your used car to come without a warranty. There are instances, however, when a manufacturer's warranty will still be attached to the used car. In other cases, private sellers may be able to transfer a car's current extended warranty coverage to your name.

Before you opt for a used car warranty, it's important to decide what level of coverage best fits your needs and budget. Most companies and manufacturers offer a variety of plans that range from comprehensive, bumper-to-bumper coverage down to basic powertrain plans.

Nearly every warranty excludes routine maintenance needs like tire rotations and oil changes as well as coverage for wear and tear components. You won't receive protection for damages due to accidents or severe weather either, as that's the responsibility of your car insurance provider.

Most used car warranty companies offer a few different types of extended warranty plans. These include:

To give you a better idea of how much a used car warranty costs, we got quotes from five of the top warranty companies. Each quote is for a 2016 Chevrolet Equinox with 90,000 miles on it.

The total price of a used car warranty is typically affected by the following factors:

Here are a few more details about the elements that affect extended car warranty costs:

Some used cars still come with a warranty attached. In most cases, however, you’ll need to purchase a used vehicle warranty from your car's manufacturer or from a third-party company. When looking for an extended coverage plan, there are a few steps you should take.

Most new cars come with a 3-year/36,000-mile bumper-to-bumper warranty and a 5-year/60,000-mile powertrain warranty. Before buying an extended coverage plan, make sure that your vehicle's original warranty has already expired. If you’re buying a used car from a dealership, find out whether it's being sold "as is" or with remaining warranty coverage.

When investigating third-party extended warranty companies, look at customer reviews on sites like the Better Business Bureau (BBB) and Trustpilot. Also, be sure to read the fine print when looking over vehicle service contracts so you’ll know exactly which components will receive extended coverage.

In our 2022 survey of 1,000 extended warranty customers, 51% bought a comprehensive or bumper-to-bumper plan. The remainder of survey respondents purchased either mid-level or powertrain protection.

Before selecting a warranty plan, reach out to various coverage providers for quotes. That way, you’ll figure out whether you’ll be paying a reasonable amount for the desired level of coverage.

A used car warranty covers the cost of certain vehicle repairs and replacements after a mechanical breakdown. As with warranties for newer vehicles, there are many different types of coverage plans to choose from. Some used cars come with a factory warranty, but models that are sold as is may benefit from an extended coverage plan.

When looking for the market's best car warranty, it's smart to compare quotes from a few coverage providers. We’ve thoroughly researched the industry's top extended auto warranty companies, and we rate Endurance and Carchex as two of the leading options.

Endurance offers six levels of coverage that last for up to 200,000 miles. Each plan comes with added benefits like roadside assistance, towing services and rental car reimbursement.

When you purchase an Endurance warranty plan, you’ll receive one free year of Endurance Elite Benefits. This package is designed to provide you with peace of mind by offering perks like key fob replacement and total loss replacement.

Read more: Endurance car warranty reviews

Our first choice for comprehensive warranty coverage.

Carchex offers a large amount of flexibility to car owners, with five levels of protection for vehicles up to 20 years old with a maximum of 250,000 miles on their odometers. The company's Titanium plan is similar to a factory warranty while Powertrain Plus protects critical parts like your transmission and engine along with the air conditioning and electrical systems.

Read more: Carchex reviews

Coverage for vehicles up to 250,000 miles and excellent customer service.

A used car warranty can cover many of the same auto repairs as any other protection plan. Most providers offer various levels of aftermarket warranty coverage, from exclusionary warranties down to powertrain plans.

If your used vehicle has a poor reliability record, it may be financially worth it to purchase an extended warranty. In some cases, the monthly payments to cover your car may be much cheaper than its overall repair bills. Note that the coverage for smaller vehicles like a Toyota Corolla will likely be less expensive than for a large truck such as a Ford F-150.

The components and systems covered under a used car warranty vary between plans and companies. In almost all cases, however, a used car warranty won't cover routine maintenance needs or wear and tear items.

Because consumers rely on us to provide objective and accurate information, we created a comprehensive rating system to formulate our rankings of the best extended car warranty companies. We collected data on dozens of auto warranty providers to grade the companies on a wide range of ranking factors. The end result was an overall rating for each provider, with the companies that scored the most points topping the list.

Here are the factors our ratings take into account:

Our credentials:

*Data accurate at time of publication.

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