Getting covered: The basics of vehicle service contracts
Most vehicles are protected from operational failures while new through warranty. This is a guarantee by the manufacturer on the integrity of the vehicle as sold and covers a host of issues typically associated with potential flaws in construction, which are subsequently repaired. Image source: americanautoshield.com But warranties are not forever. Warranties expire as the vehicle ages, leaving the car owner in charge of every subsequent repair not long after. This opens many risks for people purchasing used vehicles, whose warranties may have long since expired or are close to expiry. Thus, pre-owned vehicles are often sold with an alternative to a warranty: a vehicle service contract. Vehicle service contracts are optional packages sold alongside vehicles to cover for repairs upon the expiry of a warranty. The coverage provided by a vehicle service contract usually acts as an adjunct to other coverage policies like insurance. Although superficially similar, ...