Extended Warranty From Warranty Direct?

[seventythree]

I have an 02 Boxster with 20K miles. I just got a quote from Warranty Direct for their basic coverage of 4 years/100KM, for ~$1850 with a $100 deductable. This is not their bumper-to-bumper plan!

- I am mainly concerned with major engine/transmission failures in the future.

- I have until year end 2006 to purchase this warranty.

- I plan on doing all my own maintenance, and I am as good a DIY mechanic as can be reasonably expected (successful engine/tranny rebuilds under my belt). Is DIY a problem with extended warranty companies?

- Generally speaking, I do not believe in extended warranties.

- At this moment, money is tight but available.

- But, this is a Boxster with potential for RMS leaks and engine replacements!

Any caveats I should take into consideration prior to purchasing the extended warranty? Any and all input would be greatly appreciated.

TIA

[nightghost]

I think you should go for it . it saved me alot of money .

[seventythree]

Would a company like Warranty Direct raise an issue with me doing my own routine maintenance?

[pBunny]

I have an 02 Boxster with 20K miles. I just got a quote from Warranty Direct for their basic coverage of 4 years/100KM, for ~$1850 with a $100 deductable. This is not their bumper-to-bumper plan!

- I am mainly concerned with major engine/transmission failures in the future.

- I have until year end 2006 to purchase this warranty.

- I plan on doing all my own maintenance, and I am as good a DIY mechanic as can be reasonably expected (successful engine/tranny rebuilds under my belt). Is DIY a problem with extended warranty companies?

- Generally speaking, I do not believe in extended warranties.

- At this moment, money is tight but available.

- But, this is a Boxster with potential for RMS leaks and engine replacements!

Any caveats I should take into consideration prior to purchasing the extended warranty? Any and all input would be greatly appreciated.

TIA

I did a lot of D&D on Xwarranties and came to the conclusion WD had the best legal descriptions of covered events. "Wear and tear" is a major factor. Plus I checked with BBB and they do have a good track record in all 50 states. Meaning they do stand behind their contracts- which is what you want. Why else would any of us spend $2G+ for X coverage.

I got mine for peace of mind, even though my 99 only has 9600 miles. Sounds like you got a great price/term/milage quote.

As for DIY, I do believe it states YOU have the control over what form of repair to use. If aomething major blows, be aware they will send a REP to authorize it.

In conclusion- Insurance is a gamble. If your confiident of your abilites put that money into the market and earn interest. If you need it for a blown engine- so be it. AND- as my PCA buds always chide- it's still only a car.

Regards

pBunny

[seventythree]

I should clarify my concern with DIY.

In case I end up submitting a claim, would they raise an issue with me having done my own oil and filter changes, brake pad replacement, etc? In other words, would they try to deny a claim because I don't have maintenance receipts from repair shops? Of course, I will save my receipts for parts purchases.

[mikefocke]

You should buy the warranty if ....

You are absolutely certain to keep the car through the warranty period (no accidents, no family change, no relocations, etc).

You value certainty more than money.

You understand exactly what is covered and what isn't.

When you buy a warranty, you are paying for the expected cost of repairs plus selling and administrative expenses of both the seller and the warranty provider. That means that of the $1850 you would pay the warranty provider, probably half of that is what they expect to pay out in claims (on average, your experience could be different)

Over a lifetime, the odds of your coming out ahead by not buying a warranty are vastly in your favor. Take the $$ and invest it in a liquid account that can be used to pay for any repairs. And under that scenario, you could still be liable for a total engine replacement or trans rebuild...but the odds are slim.

I had a choice of paying $3k less for my car or taking a 3 year warranty that was transferable and paying $3k more (seller of the car could get a refund). I choose the risk and in 2.5 years on a '01 with 43k when I bought it, I've paid out about $180 that a warrant would have covered.

Applying this same logic to lawnmowers, stereos, etc over a lifetime, I'm probably $30k ahead. I only insure against things that I absolutely can't afford to pay for myself (car, house, life). And even life insurance I reduce as I age and my potential-widow would need less to live on. I'd rather us enjoy the $ now.

RMS isn't the worst thing that can happen (death and taxes rank as far more impactful) as, after all, it is only an oil leak and you have 9.5 quarts in the tank.

IMHO, YMMV

[seventythree]

You should buy the warranty if ....

You are absolutely certain to keep the car through the warranty period (no accidents, no family change, no relocations, etc).

You value certainty more than money.

You understand exactly what is covered and what isn't.

When you buy a warranty, you are paying for the expected cost of repairs plus selling and administrative expenses of both the seller and the warranty provider. That means that of the $1850 you would pay the warranty provider, probably half of that is what they expect to pay out in claims (on average, your experience could be different)

Over a lifetime, the odds of your coming out ahead by not buying a warranty are vastly in your favor. Take the $$ and invest it in a liquid account that can be used to pay for any repairs. And under that scenario, you could still be liable for a total engine replacement or trans rebuild...but the odds are slim.

I had a choice of paying $3k less for my car or taking a 3 year warranty that was transferable and paying $3k more (seller of the car could get a refund). I choose the risk and in 2.5 years on a '01 with 43k when I bought it, I've paid out about $180 that a warrant would have covered.

Applying this same logic to lawnmowers, stereos, etc over a lifetime, I'm probably $30k ahead. I only insure against things that I absolutely can't afford to pay for myself (car, house, life). And even life insurance I reduce as I age and my potential-widow would need less to live on. I'd rather us enjoy the $ now.

RMS isn't the worst thing that can happen (death and taxes rank as far more impactful) as, after all, it is only an oil leak and you have 9.5 quarts in the tank.

IMHO, YMMV

Mike,

I agree with your perspective on extended warranties wholeheartedly; hence my statement in the original post, "- Generally speaking, I do not believe in extended warranties."

However, with the most recent quote of $1,350 for MajorCare MBI over 4years/75,000 miles, that's roughly $1 a day for peace of mind. Given that exact figure, is that a good deal? I do agree that based on averages I will do better on my own. But, is a Boxster an average car to maintain? I am new to Boxsters and thought I should ask before making a decision, one way or the other. BTW, the warranty cost will just about double comes January 1st.

Regards

[fasterjames]

I have Warranty Direct for my wifes Honda Odyssey and they have been excellent to work with in the 3 times we've needed them. I wrote service at a few dealerships in the past and typically associate lots of frustration with any company. I would say that WD is one of the easiest I have worked with.

Peace of mind is worth a lot but so is your cash in hand. Do you have maintenance records? If you have proof that it was well maintained you 'likely' won't need it. If you don't have records you may want to do a major service yourself and check for things like oil leaks, metal particles in the oil (you can look or even send to a lab for analysis), bad spark plugs, etc. This will give you a better idea of it's maintenance.

One thing to watch out for: when a company tells you 4 years/75K miles, make sure it is from the date of purchase, not the in-service date of your Boxster. This is a very common issue and people find out they just spent $1500 only for an extra year.

As for DIY maintenance you should be fine but keep ALL of your receipts, make photocopies (because the receipts will lose their ink after a few months), and make mileage notes. If you want to go the extra mile, take a picture of your receipt next to the mileage on your Boxster each time you perform a service just to lend some extra credibility to any claim you make.

[seventythree]

Some additional info:

- The warranty plan is for 4 years from the date of purchase or 75,000 miles total, whichever comes first. The current mileage is 21,000.

- As far as service records, all that has been done so far is 3 oil changes, and a new battery from Porsche. It still has the original continental tires from the factory.

- At the time of purchase, the PO took the car to a reputable independent Porsche service center and paid for air and cabin filter changes. He also picked up the tab for the PPI. I went there while the car was still on the lift and the shop owner personally reviewed the entire car, over and under, with me. They also hooked up the PST2 and read the fault code history and the log for STRESS incidents. Stress incidents were at ZERO. Just to put thing is perspective, he said that they typically see 3 figures. He also said that a 911 twin turbo they had recently inspected had over 4000 incidents logged.

- The only issue he pointed out was minute oil seepage from the engine tranny interface and the right side of the engine, which he thought was no more significant than what they see on all Boxsters.

This car is in as new condition. If money wasn't a little tight at the moment, I would have bought the warranty as extra insurance. I am paying quite a bit more for comprehensive coverage as opposed to carrying just liability!

Well, I guess I have one more month to decide. :(

[mikefocke]

Yes Porsches are much more expensive to maintain than Toyotas.

But the $1350 warranty, given the commissions and expenses that must come out of that figure, mean that they are figuring to pay out ~$400 over several years. So there are going to be significant exclusions in what is covered.

I'd look at the various warranties they offer and see if you can figure out by comparing the one you were offered with the most expensive what isn't covered in the cheaper one.

Figure a full coverage warranty was going to run me $3k and that you never get something for nothing, what are they saving on?

My bet is they cover internal lubricated parts, and not much else. Get water in the computer or a MAF or a problem in the suspension or a ripped top and you are on your own.

Could be wrong, but when I was doing my analysis (and I was buying a car with a very problematic history and in superficially horrid condition so I was more predisposed to warranty than my norm) I saw lots of exclusions.

Oh, and a good rule of thumb is that any special offer that is only good till tomorrow probably isn't a good offer. If it is a good deal, it sells without the pressure tactics.

Good luck in your decision.

[seventythree]

Oh, and a good rule of thumb is that any special offer that is only good till tomorrow probably isn't a good offer. If it is a good deal, it sells without the pressure tactics.

Once again, I agree. I have been burnt on bogus warranties in the past and hated it every time. But just to keep the discussion factual:

My car, being a 2002, currently qualifies for the lower tier pricing because it's considered 4 or less model years old and has less than 50K miles. Once we roll into 2007, it will be considered as being 5 MYs old and no longer qualify.

Edited November 7, 2006 by seventythree

[Danyol]

I have a WD policy on my '02 911.

I had my car in for a new clutch, they paid for a new flywheel and labor when my mechanic found issues with the flywheel. Took some work on behalf of the shop to convince them the flywheel is a part of the engine, bottom line they paid. Saved me >$2k, although they wouldn't pay the shop's full service rate the difference amounted to $3-400.

[seventythree]

I have a WD policy on my '02 911.

I had my car in for a new clutch, they paid for a new flywheel and labor when my mechanic found issues with the flywheel. Took some work on behalf of the shop to convince them the flywheel is a part of the engine, bottom line they paid. Saved me >$2k, although they wouldn't pay the shop's full service rate the difference amounted to $3-400.

Which coverage plan do you have?

Thanks

[Danyol]

SecureCare+ and I added the emissions coverage.

I understand the odds are usually in their favor but I like to have the peace of mind. I'm not doing bad so far after the flywheel change.

I had a "check engine" light come up last week, a PO431 which I reset myself. If it returns I'm confident WD will pay for remedials on that too, unless this is an original warrantee covered part (CAT converter?).