Extended warranty?

[Pathman]

Hey all, picking up our new Travato next week. Still contemplating the extended warranty. I realize most comments appear to be against it, but I would follow up those comments with a question regarding large expenses, I.e. generator, furnace, water heater etc.

How many of you regret not taking the warranty due to expenses from large equipment breakdown after the one year Winne warranty was over?

Would appreciate any input, PMs are ok as well.

Thanks!

[avanti]

Originally Posted by Pathman

Hey all, picking up our new Travato next week. Still contemplating the extended warranty. I realize most comments appear to be against it, but I would follow up those comments with a question regarding large expenses, I.e. generator, furnace, water heater etc.

How many of you regret not taking the warranty due to expenses from large equipment breakdown after the one year Winne warranty was over?

Would appreciate any input, PMs are ok as well.

Extended warranties are one of the most profitable revenue sources for dealers and these products are marketed extremely aggressively. The providers don't seem to be too worried about your generator, furnace or water heater breaking. That is because they know that for every one that breaks, there are a great many that don't.

Of course, you might get "lucky" and get your money back. But the odds are likely quite a bit better at your neighborhood roulette table.

Would one or two of those "large" items cause you genuine financial stress if you had to pay for repairs? If so, you frankly should think twice about this purchase. If not, then self insure and you will be far ahead in the long run.

Extended warranties are a sucker's bet.

[Pathman]

Appreciate your comments Avanti. Please don’t perceive my response as argumentative, I’m simply trying to see all sides of the discussion by playing devils advocate.

So, you’re asking me if having to replace one or two large items would be a financial hardship, we’ll, i don’t know because i have no idea how much they cost to replace.
But I would then ask, is the cost of extended warranty coverage a financial hardship for you? If it is, I can see rolling the dice and not making the purchase, if it’s not, then why roll the dice? Just buy the extended warranty and your gambling days would be over! LOL
That being said, what is the cost of the bigger items that may break after the first year of ownership, and are there other reasons not to buy the coverage?

[avanti]

Originally Posted by Pathman

So, you’re asking me if having to replace one or two large items would be a financial hardship, we’ll, i don’t know because i have no idea how much they cost to replace.

You can take it to the bank that the insurers know those costs. Do you really want to bet against the party that has all the information?

But I would then ask, is the cost of extended warranty coverage a financial hardship for you? If it is, I can see rolling the dice and not making the purchase, if it’s not, then why roll the dice? Just buy the extended warranty and your gambling days would be over! LOL

You are rolling the dice either way. It is just that in one case you are betting against the house. And the house always makes money, which means that customers (in the aggregate) always loses money.

Whether one can afford to buy a ripoff product is kind of beside the point, no? The market is full of junk that I could easily afford but would be crazy to purchase.

[Pathman]

So, that would be a solid NO on your part? LOL

Just kidding around a bit, I know things tend to get way too serious on forums.
Appreciate your thoughts, I will seriously consider your perspective.

Thanks.

[avanti]

Originally Posted by Pathman

So, that would be a solid NO on your part? LOL

Just kidding around a bit, I know things tend to get way too serious on forums.

Yeah, that's just me. You picked one of my hobby horses, I'm afraid. IMO, these products border on fraud, so I tend to get a bit too worked up. Sorry.

[peteco]

Originally Posted by avanti

Yeah, that's just me. You picked one of my hobby horses, I'm afraid. IMO, these products border on fraud, so I tend to get a bit too worked up. Sorry.

The warranty companies are experts at weezling out of covering repairs sometimes. I got burned on a transmission repair many years ago because of the way the tech worded the repair.

[Pathman]

Originally Posted by avanti

Yeah, that's just me. You picked one of my hobby horses, I'm afraid. IMO, these products border on fraud, so I tend to get a bit too worked up. Sorry.

I get it, no worries, I have my own “hobby horses” as well!
Thanks for the input.

[<<B-Guy>>]

I pretty much agree fully with the position state by Avanti. These companies are not in business for altruistic reasons but obviously to money.

Having said that, in the past I have bought extended warrantees on vehicles a couple of times, particularly when I started towing heavy trailers, knowing that towing is hard on vehicles. One thing I will say is that at the time, i allowed be to travel with peace of mind thinking - I can relax, don't need to worry, anything goes wrong and it is covered!

I suppose that to a degree that extra relaxation was worth something to me.

But at least with one aftermarket insurance company I dealt with and had a number of claims, it was an absolute nightmare dealing with them - not a good experience at all. They would go to great lengths to avoid paying and in two instances only backed down when I threatened to take the issue to court.

I don't know if it is typical, but the next time I bought extended coverage, it was through the vehicle manufacturer rather that an aftermarket company and the experience was much better.

With RV's, I believe you would always be dealing with aftermarket companies and I don't have a good feeling about them.

I rejected my dealer's "Kind" offer to sell me aftermarket insurance on our 2109
Pleasure-Way. I now prefer self-insurance!

Brian.

[avanti]

Originally Posted by <<B-Guy>>

I don't know if it is typical, but the next time I bought extended coverage, it was through the vehicle manufacturer rather that an aftermarket company and the experience was much better.

Yes. I should have made clear that my absolute rejection of extended warranties as never worth buying does not extend to true OEM extended warranties issued by the vehicle manufacturer. The latter CAN be a reasonable product.

The difference is that the OEMs (a) can fix your vehicle for much less money than anyone else, and that (b) they have a vested interest in "keeping you in the family" and make money in many ways by keeping you coming back to the dealer. For these reasons, OEM warranties are not zero-sum games the way all third-party warranties are.

So, OEM warranties may be worth considering--it is at least logically possible that they may be worth buying and some are very good. That said, others (sadly, including the warranty MB offers on the Sprinter) are expensive, inclusionary warranties that don't really cover the things that most need coverage. Read the fine-print carefully before buying. Under no circumstances just assume that it is just an extension of the vehicle's initial warranty. This is often far from the case.

[Pathman]

Thanks for the follow up and clarification AV. Are there actually OEM extended warranties available? Dealer didn’t mention it, only provided brochure on aftermarket policy.

[Boxster1971]

Originally Posted by Pathman

Thanks for the follow up and clarification AV. Are there actually OEM extended warranties available? Dealer didn’t mention it, only provided brochure on aftermarket policy.

The OEM extended warranty would only cover the RAM van chassis components, not the parts Winnebago added to your Travato.

[Pathman]

Originally Posted by Boxster1971

The OEM extended warranty would only cover the RAM van chassis components, not the parts Winnebago added to your Travato.

I see, that’s not what I’m looking for, the WB components are my concern.

[Davydd]

You don't have to purchase an extended warranty up front do you? I thought you could delay that decision until your original warranty is about to run out. At least I could with my van.

[<<B-Guy>>]

When I bought my van and told the "Financial saleslady - deal closer" that I did not want the aftermarket extended warranty, nor special paint upholstery magic treatment etc, I did question her as to if I could change my mind and buy the extended warranty later if I cosed to do so (Highly unikely!) and with the particular company they sell for, she told me that I could!

So we finished our conversation still on good terms with her thinking I ight be coming back and bringing her some more business - but somehow I doubt that will happen!

Brian.

[avanti]

Extended warranties, special paint, upholstery magic treatments...

Ah yes.

Many years ago, we were buying some Japanese car that was incredibly popular and in short supply, so dealers were commanding sticker price plus. We were looking at the sticker in the window, and there was a line item that said (I swear this story is true):

"EXTRA DEALER PROFIT"

If only dealers these days were so honest.

[booster]

Originally Posted by avanti

Extended warranties, special paint, upholstery magic treatments...

Ah yes.

Many years ago, we were buying some Japanese car that was incredibly popular and in short supply, so dealers were commanding sticker price plus. We were looking at the sticker in the window, and there was a line item that said (I swear this story is true):

"EXTRA DEALER PROFIT"

If only dealers these days were so honest.

We saw some of those, also. Along with a bunch that included hugely increased, and required, promotional fees, prep, and all the paint, fabric and rustproofing stuff. We did appreciate the transparency on the added profit thing, though.

[Pathman]

Originally Posted by Davydd

You don't have to purchase an extended warranty up front do you? I thought you could delay that decision until your original warranty is about to run out. At least I could with my van.

Yes you can purchase later.

[Ron J. Moore]

I was fortunate enough to have a honest salesman.....the Owner, for my first buy. He told me that it is just money out of your pocket buying those Extended Warranties. He said they have more caveats to avoid paying, and it is really expensive. His suggestion was to find out the cost of the Extended Warranty, put that in the Bank - if you breakdown use it for the repair. Amazing, I saved mucho bucks over the years.......water pump, alternator.....they will fail eventually, but you have your money in the bank. Ron

[RossWilliams]

Warranties are insurance. Like all insurance, the average person will come out behind when you consider the alternative of investing the money spent on insurance. But very few of us are average. We won't have average expenses and we won't get average returns.

The question is what happens if you take the risk and you lose and have a large bill. How will you pay it and what will be the consequences? Will you have to borrow the money, at what interest rate? Will that large lump sum have to come out of a retirement account where withdrawals are taxable income? What will that add to the cost.

For most of us, warranties will not make sense. But if you are retired on a fixed income with limited other liquid assets, you might want to evaluate the consequences of the largest potential bill the warranty will cover. In most cases you can add the warranty to the purchase price and finance it along with the vehicle. The small increase in regular payments may be a lot easier to handle than a big bill all at once. That's why we buy insurance.