As defined by the Federal Trade Commission, an auto warranty is something that is only sold with a new car. A car warranty is bought at the time of sale for the new automobile. If a warranty is sold after the car has left the dealers lot and is no longer new – it is no longer an auto warranty but an Auto Service Contract. What is the big difference between these two? Well, it’s really just a matter of wording.
If you are looking to buy an extended auto warranty, you should go into it knowing that the warranty is actually an auto service contract. I found a great article all about the clear definition of an auto service contract at the FTC (Federal Trade Commission) website. Here is a brief synopsis of how they differentiate an auto warranty from an automotive service contract.
The Auto Service Contract
A service contract is a promise to perform (or pay for) certain repairs or services. Sometimes called an “extended warranty,” a service contract is not a warranty as defined by federal law. A service contract may be arranged at any time and always costs extra; a warranty comes with a new car and is included in the original price.
The separate and additional cost distinguishes a service contract from a warranty.
Here’s how you can obtain a car service agreement (another way to word this) for your automobile that works just like how most people imagine a warranty works. First off, get a quote from a company you trust. You can use the quote form on the right to get a quote right now so you have an idea of how much a warranty for your auto should cost. If you like the price – you have the option of buying it right from our live rep that helped you get the quote for the auto service contract – fast & free!
