Why You Need A Vehicle Service Contract

Why You Need A Vehicle Service Contract
Contemplating a vehicle service contract, but unsure of how it works or how it differs
from an automotive warranty? You’re not alone. A lot of consumers tend to get the
two mixed up or fail to understand just what they cover. But seeing as how your
vehicle is usually the second most important purchase you will make right after your
home, it is in your best interest to do your homework and make sure that you are
What exactly is a vehicle service contract?
It is an agreement to cover costs associated with repairs or services made to your
vehicle. A manufacturer’s warranty, on the other hand, is a promise from the
manufacturer to stand by their workmanship for a limited time after you purchase
the vehicle. Once this warranty expires, a vehicle service contract becomes valid and
provides you with much-needed coverage on your vehicle’s most important systems
and components.
Is a vehicle service contract right for you?
Here are a few things to consider:
• Keep in mind that the average hourly rate for a mechanic is $100 an hour. A vehicle
service contract can help do away with this cost, save you money and keep you from
paying any unforeseen and unexpected repair bills.
• If you plan on owning your car for an extended period, it’s definitely in your best
interest. A vehicle service contract can keep your car running at its very best and on
the road for a long time.
• Even if you don’t intend to keep your car for long, a service contract can increase
your vehicle’s resale value once you decide to sell. But before you do, make sure that
the service contract you’re purchasing is transferable.
• Do some research into the make and model of the vehicle you plan on purchasing. Is
it likely to need repairs and, if so, what are the costs? Weigh this against the price of
the service contract to determine if it is worth it to you.
• Does the contract include extras such as discounts on hotels and restaurants, rental
car benefits, locksmith services and 24-hour roadside assistance? Not only do these
add to the value of the service contract, they can provide you with added peace of
mind in the event that something goes wrong while you’re on the road and away from
• Take your driving habits into account. Will you be on the road a lot? Is there a lot of
stop-and-go traffic? What are the road conditions like? Do you park outside where the
weather is extreme? These can all have an adverse effect on your vehicle.
• Check the terms and conditions carefully. Make sure you know exactly what you’re
getting and what is covered specifically.
• In addition to the type of coverage, be mindful of the length of coverage, miles of
coverage and deductible.
• Research the company providing the service contract. Are they reputable? Some
guidelines to help determine this might include checking their Better Business Bureau
rating to see how they work with consumers and finding out what their A.M. Best
rating is to verify financial strength and stability.
Have questions about a specific vehicle service contract?
Don’t hesitate to ask your salesperson or agent for more information. Most
dealerships typically provide you with a brochure or direct you to a website so you can
review the plan in its entirety. Take time to make sure that you fully understand the
scope of the service contract and don’t get pressured into purchasing something that
makes you feel uncomfortable. With so many options currently available, you are sure
to find something that is satisfactory for your budget and your vehicle’s specific
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Article Source: https://warrantech.com/blog/october-2017/why-you-need-a-vehicleservice-contract/