Warranty companies basically act as a third party that shares the future risk of mechanical problems, and breakdowns. Some consumers choose to have this risk shared, even if the premium is unjustifiably high, but they rather play it safe, and not get themselves in a situation where the car is broken, and they can't afford fixing it. A fixed monthly payment, or a lump sum at the signing saves them surprise expenses.

At Cars in Houston, we think its worth reminding you that warranty companies are in business to make money, and not to save you money when your car breaks down.

But, how do you look for catches in  contracts? and what should you watch for?
 

·         No such thing as a standard warranty.

·         Contact the BBB (Better Business Bureau ), or the FTC (Federal Trade Commission)

o        Check the record of the company.

§         You do not want to pay a company that has a colorful history of consumer complaints.

·         Request to see the full decelerations page in writing.

o        Check the mileage limitations

o        The time limitations

o        Check if there a limiting book value for the car.

o        Deductible for repairs.

o        Check the repairs that are covered

§         Check for coverage overlaps any other existing policies you may already have.

§         Check for the procedures required for filing a claim,

§         The sort of routine maintenance record must be kept.

§         Are you going to pay then get reimbursed,

§         Or, the company takes care of the billing.

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