How to buy extended warranty on a used car

Used car extended warranty options can differ greatly throughout Australia whether you are purchasing from a dealership or directly from an insurer.

Here are 5 things to consider before you buy extended warranty on a used car:

1. Dealership vs Private

Dealerships provide a statutory warranty of 3 months or 5,000km from the date of sale (whichever occurs first). This applies to used vehicles that have travelled less than 160,000 km and are less than 10 years old. If warranty repairs are required on a vehicle and it is undriveable, it is the dealer's responsibility to get the vehicle back to the dealership for repairs or authorise repairs in the remote location. Of course, the dealer would have no responsibility if the vehicle was abused.

If you were to take out a used car extended warranty – make sure it kicks in after this 3 month period to get maximum coverage.

2. Eligibility

If you buy a used vehicle over 10 years old or one that has travelled lots of kms (over 140,000kms) you may not be able to get your car extended warranty cover.

3. Coverage required

Be wary of the variations in coverage on different products.

A dealership may offer a used car extended warranty that requires you to service the vehicle exclusively at that dealership. 

Lesser extended car warranties in Australia are limited in what they offer and may only cover selected parts of the engine, and low repair costs in the range of $500-$1000. 

There may also be claim limits where once that limit is reached – you are out of pocket for the rest. For example, you have a claim limit of $1,000 and your gearbox requires replacing. This may cost $6,000 so you would be required to fork out $5,000 despite having warranty cover.

For this reason, Auto Auto only offers extended car warranty that has a claim limit up to the market value of your vehicle (up to $120,000). Should anything go wrong, this mitigates your financial risk.

4. When to buy extended car warranty in Australia for a used car

When purchasing a used car, it pays to know when the manufacturer warranty expires. You may be purchasing a vehicle with 2 years warranty remaining. It would be beneficial to purchase your used car extended warranty when the manufacturer warranty expires so you have a better idea of if you will keep the vehicle and get benefit out of coverage.

For example, you purchase a used 2019 Toyota Hilux. The Toyota Hilux has a 5-year Toyota manufacturer warranty which will expire in 2024. Instead of paying for extended car warranty when you purchase the vehicle, you could choose to purchase it in 2024.

5. Reliability and repairs

Some brands of vehicle are more reliable than others, which will play into your decision to purchasing a used car extended car warranty.

If you buy a more expensive or less reliable used vehicle, then having car extended warranty coverage for that vehicle could pay for itself many times over in the event of a claim. 

Repair costs for more advanced or certain higher-end cars can also often be quite substantial. 

On the flip side, if you purchase a reliable vehicle – you may never have to make a claim and have no need for extended car warranty.

GET A QUOTE

Auto Auto has made it simple to get extended car warranty for your upcoming used vehicle purchase. You can check your eligibility then get 3 years of comprehensive coverage in 60 seconds. You can do this entirely online without having to call up a dealership or insurer – however if you want to talk to someone, we are readily available! Contact us at info@autoauto.com.au.

Previous
Previous

Is it worth buying extended car warranty?

Next
Next

Deciding if extended car warranty is for you