Understand. I guess it's still worth pointing these things out so people realize that just because its an industry-wide practice, it still boarders on fraud [deception by omission]. It's just like how so many knowledgeable people have remained silent as governments [facilitated by central bankers] have driven us to the edge of the cliff of financial insanity.

When I recently purchased my F type over this past summer [from a JLR dealer in LA], I had to do the mandatory sit-down with the purchasing manager where he attempted to sell me every conceivable warranty/add-on imaginable. After each of his well-rehearsed presentations, I told him EXACTLY why I thought each made little sense. At the end, he just shrugged his shoulders, looked some guilty and said this was part of the process and he understood how I felt.

Because this system lacks so much transparency, people have kind of given-up. Not a good thing...

 

MaxCare is actually one of the better/best aftermarket extended warranties, from my research. Quite honestly, we wouldn't have gotten Kitty without either MaxCare, or being a CPO. An awesome blog The Carmax Unicorn Blog, is the primary reason we bought our F Type.

We got our 2016 base coupe in April 2020, with 15,500 miles on the clock. We also chose the 5 year, 75,000 mile MaxCare warranty, with a $300 deductible; paying roughly $2,800 for it.

A couple issues popped up, and CarMax never hesitated to correct them; or refer us the local JLR dealer, for warranty work. CarMax did bite the bullet on passenger side aluminum window trim that was lifting. JLR dealer would have honored it under warranty, but CarMax had previously attempted a fix, using weather strip sealant/glue (I've heard this is a common method) so they passed. CarMax ordered the part ($900+ IIRC), and replaced the trim without hesitation. Our CarMax also stated that if a MaxCare repair is needed, and their techs can't perform it, they would send the car to local JLR dealer for service. There are occasional hiccups, mis-ordered parts, multi-step problem fixes...that maybe a JLR dealer would handle more efficiently...but I feel like MaxCare has been a blessing, and my wife loves the peace of mind.

FWIW, the services that we've needed were identified within our first 90 days of ownership, and/or handled under JLR warranty; thus, we've not had to pay a deductible yet.

 

The only extended warranty I believe in is the manufacture CPO. I got ripped off on a Red Shield warranty where they treated me as a criminal when I had the nerve to make a claim

 

I have CPO on my car for 22 more months...or 100k miles.
Prior car had a Subaru 7y/100k warranty. Subaru is amazing at doing a warranty (gold, no deductible, bumper to bumper...even whole engine replacement is covered, dash squeaks...the works as if new). They did try to add paint and fabric protection for a lot that I declined...so they played games as the OP suggested. I had the same sort of interaction...that is where they make money now in dealerships. It could be a decent percentage of their new car income (service is where real money is made afaik).

Why do I like (real) warranties:
Bought a 996tt years ago three states away from a small exotic car specialist for too much that was perfect (had a PPO from the best Porsche speed shop per PCA HPDEers in that big city....at a 400 dollar cost.....- got offered a warranty that I reluctantly added for ~3000 dollars (seemed like a huge amount at the time but the sales guy said it would be worth it...and for some reason I actually trusted him....don't know why but once in a while a car guy gets in the business and you can tell...). That 3000 dollar warranty covered over 15,000 in issues in 3 years. (Porsche's are not bulletproof no matter what their owners tell you...) It was metastable after that for about 8 years of hard use (when it was not having issues it was great) and then it started to have big issues...sold it to an exotic car dealer with full disclosure of the known issues and he was more than willing to take it all on (about another 12k - I would not get near a Porsche without a warranty given my experiences....

 

People put too much faith in warranties without understanding how they work. Warranties are for when parts fail/break before their calculated lifetime and without being subjected to abuse. Once a car is beyond 20k miles, unless a major driveline component fails, most manufacturers will claim age or abuse to not cover the repair. There are some dealers out there who do go over and beyond to get repairs covered but warranties after 5 years or 20k miles rarely pay off. Do I have actual data for it? Nope. I am using my own experience, as well as those of my family, close friends and local car club friends.

That being said, if someone feels "better" buying an extended/aftermarket warranty, go for it. There are worse ways to use money.

I used to work for a subsidiary of Zurich Financial. They create and sell all of those policies so I'm well versed in them: https://www.zurichna.com/industries/...fandi-products

Everyone has a different situation. For example, gap coverage. Some would say those who need gap coverage shouldn't be buying a car. Unfortunately, there are necessities depending on where one lives that may need a product like that. I understand that "for you", those products are unnecessary. I'm in the same boat. However, I do understand those products do help out those in different living areas with different life circumstances.

People haven't given up. They buy what they need and ignore the rest. Most of these products are more "Piece of Mind" products than anything actually useful. That being said, you are entitled to feel your own way, but not expect to speak for the masses.

 

My take on extended warranties is that they make money for the provider and perhaps the seller too. Not sure about the latter, but I worked with someone who had done a stint at Circuit City and he said he got as much commission on a $30 extended warranty as he did on the $300 VCR it went with.

That said, paying $4k to avoid the possibility of paying $25k for a catastrophic engine failure is a choice the owner needs to make. The possibility that a catastrophic failure could be denied is really an issue with the insurer and I expect it varies. They don't make profit by writing checks. The business model is to take the money and deny as much coverage as they can get away with. If it wasn't profitable for them, they'd raise the rates until it was.

 

Right-O. Would have saved me 21k if I'd had an EW. 4k isn't cheap but in hindsight...

Happy New Year

 

That's assuming they deigned to pay the claim. I don't know the details, but I have not heard many tales of the generosity of EW carriers.

 

Point well taken! That would have shifted me from the c'est la vie column to the the murderous rage column.

 

Let's say you consult with your doctor and s/he recommends a procedure for a fairly serious health issue. You ask the physician what are the chances that such a such procedure will result in resolution as well as the potential complications. The doctor replies that he cannot reveal this information.

I would assume that in the above scenario that you would head for the door as quickly as possible.

Why should somebody who has just spent a fair amount of money on a sports car [or any car] be asked to pay thousands of dollars for financial protection without knowing the risk? Why is this any different from knowing the risks involved in anything else in life? Who buys a product specifically designed to mitigate risk without knowing what that risk is?

Did they reveal to their clients [beforehand] what the risks were for which they were being sold protection?

It matters not what their situation is...the only thing that matters is having enough information to make a prudent decision.

"Peace of mind" products are like any other products...they should be priced fairly with maximum transparency.

And who said I am speaking for the masses? The extended warranty ruse [in general] was revealed for all to see when Consumer Reports went public with their findings decades ago. Now I am sure you can find a few examples of reasonable extended warranties but, on the whole, if an industry refuses to reveal actual risk, it's the largest and brightest red flag there can be.

 

In reference to a previous statement, there is a markup on warranties. I had previously said that the Maxcare I out in my F Type was the first, but I remembered a Mercury Mountaineer back in 02. At the time I paid about $700 and the retail was probably $1100. The dealer was next door to our restaurant and I was kind of a Ford guy for a while. So, yeah, the dealer has a markup and flexibility on the price if they choose. I bought the Maxcare not for the engine and transmission so much as the mid level items like evaporator or compressor or HVAC controls, differential, window regulators etc. CarMax does not negotiate warranty pricing. On me, they made money on the shipping from California, the vehicle and the warranty. And I'm Ok with it. Something dealers used to say...."It's not the deal they got, it's the deal they THINK they got"

 

Terrible analogy and borderline (if not over the line) strawman.

I don't think you understand. Car dealers are "resellers" of plans owned by Zurich. The plans the salesperson offered you that you declined, are provided by Zurich.

So, you are too lazy to do your own research? With the age of the internet, you cannot be bothered to go out and see what actual owners are going through? Oh, you want it on silver platter.

In short, it's not going to happen any time soon. The automotive industry is not regulated like healthcare for example. Why is that important? How can you report on things that cannot be tracked? Even with the old Consumer Reports and some of the current reliability reporting has terrible and incomplete data. They get their data by bothering owners with surveys. That is one of the worst ways to build a useful data lake.

What you are seeking is to have the automotive industry regulated (and connected) on what / how things are reported, and then having that data in your hands for when you purchase a used vehicle. Why is getting vehicle history still a chore today and incomplete in this age? As written above the lack of regulation and reporting requirements (and ownership of the data, i.e. where are they sending this data, who is paying to maintain it, etc). Your attempt at an analogy with healthcare was terrible for many reason but healthcare is heavily regulated and connected. Healthcare has interfaces for data exchange and regulations that require that data to be available: https://www.healthit.gov/topic/information-blocking. Healthcare is built around using data to make life altering decisions.

Most industries, like automotive, are not open and regulated to that depth with leads to a lack of visibility and reporting. The fact that the data in this use case would not lead to making life altering decisions means that it's unlikely to happen any time soon. At some point in the future, everything will be interconnected but today, use the resources at your disposal (i.e. the internet).

However, you have to ask yourself, why would you want to buy something you know would need an aftermarket/extended warranty? I'm not talking about standard vehicle warranties when purchase a new vehicle. Extended / aftermarket warranties are money making schemes that pray on those with financial insecurities. If people stop buying them, they will stop being a thing. However, many people buy into them for the "Peace of Mind" without reading through their fine print.

To your question, why can't you have the data? Because it doesn't really exist. That's the same really for any warranty offered whether it's for mobile devices, televisions, etc... You can seem to get a warranty on anything these days. There is some data out there, but again, it's all survey based which is not the best way to build usable data.

FWIW, I spent 4 years in IT for the automotive industry (specifically in F&I products), 15 years in Healthcare IT, and I have experience in other industries as well. Helping businesses move forward using data is where I have spent a lot years.

 

I think most complaints about extended warranties are those that don't understand what they are buying. "What you MEAN brakes aren't covered?!?!?!?!?! I paid $$$XXX and now I have to pay for brakes?!?!?!?! " Meanwhile it is clearly disclosed that maintenance items, specifically oil changes and brake components are NOT covered. Or the buy the base warranty that is pretty much just catastrophic engine or transmission failure. "What do you MEAN, my AC system isn't covererd. I PAID $$$XXXX for a warranty!!!!! " for sure there are shady companies out there. I bought a cadillac XLR carmax maxcore warranty. It was expensive, about $4,000. It was 6 years and up to 100k miles. Total bills paid by maxcare was over $14,000. Like others said, carmax didn't even blink. If they could fix it they would, if not, off to cadillac dealer.

I have been actively searching EW on F-types. And I can say it is EXPENSIVE....cheapest I have found from Fidelity (one of the good ones) is about $6000 with a $500 deductible. I have shopped others that are reputable, but they all seem close. Carmax one was really high as well.