My Experience with Warranty Direct

Six years ago I bought an extended warranty for my 2001 Chevrolet Prizm at Warranty Direct. Here are the details of the warranty:

• 6 years (starting at year 3 of car's age) or 75,000 miles
• MajorCare Coverage with $100 deductible
• Emergency Roadside Assistance up to $50 per occurrence
  
• Paid $583 in February 2004

My Chevrolet Prizm has proven to be very reliable. I never had anything go wrong with the car. So I never had a chance to test how Warranty Direct handles claims. Also, I never even had a chance to use their roadside assistance.

According to Warranty Direct's terms and conditions book, you have to instruct your repair facility that they must obtain authorization prior to making repairs. The Administrator will then reimburse the repair facility for the cost of authorized repairs, less the deductible.

This is often where you learn of the quality of your extended warranty provider. Will they authorize repairs or will they claim that it's not a covered item? Unfortunately for this blog, I don't have personal experience with this.

Before the contract expired, I called Warranty Direct to see if I could get anything back for not having filed any claims through the six years. No luck. They did try to sell me a new plan, but it was much more expensive. For a 5-year PowerShield (covers engine, transmission, air conditioner, etc.) the cost was $1909. They offered another special plan with a $0 deductible for $1609. I decided it was too much. With the car 9 years old, I'll just keep some money in a savings account to cover future repair costs. If too many major problems arise, I'll just get a new car.

One thing to note is that Warranty Direct did survive over these 6 years. One of the main concerns with non-manufacturer's extended warranties is the question of if the company will hold up. Many have gone out of business leaving customers with worthless policies.