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Why you might want to cancel your extended car warranty?

A rare term to go buy; ‘Extended Car warranty’ is one of those rapid-fire decisions you have to make in the heat of the decisive moment!

Let us get one thing straight! All automobiles come with company insurance and warranty. So Whenever you are looking for cars, you know for a fact that you that the company is going to cover the first three years or certain thousand miles for your vehicle.

If you are willing to dive into an extra privilege of not having to worry about your automobile for longer than the promised time period, then you ought to know about extended warranty compliance.

An extended warranty is more of a defining term that falls under extended insurance. It might save you from paying for expensive repairs later at some point of time in case of accidents. Whatever your standard insurance package might have been, these warranties just add a couple of years over it, prolonging the period while offering the same services.

A female garage mechanic is standing with a customer in her garage and is explaining the itemized bill to him.

Such policies are called Original equipment manufacturer (OEM) extended warranties. Before signing up for any such measures, you might want to acquaint yourself with the main warranties you might be interested in before buying your vehicle.

Whether your warranty purchase is coming from the automobile makers or a third party dealer, with an extended warranty you would be able to cover a mix and match from other several coverage plans. It all depends on your pocket, however. The more expensive you are willing to invest; the more repairmen coverage you will be able to secure.

Most buyers however switch or mix these two main plans.

  • Powertrain Warranty

This warranty covers the main powertrains of your vehicle. All the main engine and transmission issues are covered under this warranty. 

  • Bumper-to-Bumper Warranty

This warranty is basic and comprehensive coverage. However, there are certain services that are excluded under this warranty. Still, you would be able to find a perfect fit for people who opt for extended or factory warranties.

  • Third-Party Warranty

Similarly, you can find a third party warranty that will allow you to secure a warranty package from the automobile dealer company you have purchased your vehicle from.

Availing extended warranty might be dependent on many circling factors, such as who made the automobile, how heavy your investment can be, do you find it as a necessity and so on. All these factors are a contributing factor in why some people opt for extended warranty measures.

However, if you are not interested in going for that extra mile, GOOD for you!

In case you were talked into it by some automobile dealer and are dangling in between whether you should cancel it or not. You might want to continue reading as to why canceling extended warranty can be a wise move.


Here are some of the quoted examples of people who were not looking forward to this settlement and how it turned out to be




The biggest reason why people are pressured into continuing having an extended warranty is because of the flowery talk of their dealers. We get it! It is easy to not think about all the risks of not purchasing the deal when the future sounds secure. In spite of the comfort you feel, an extended warranty might not be your best decision. In 2019, a consumer report stated how many extended warranty deals worth $1200 do not end up using it before the time runs out. In some situations, you end up paying for the policy more than what you could’ve paid for the immediate repair out of your pocket. Some cars do not require more than their regular maintenance checkups, especially if they are coming from a renowned automobile company. Having an extended warranty would definitely get you into a hostile money gamble!


In most cases, buyers often come across situations where they are made to avail of extended warranty packages by slipping it into their car financing contract without their consent or knowledge. So before signing those papers you might want to go through those policies again or else you would be unintentionally subjected to paying extra dose of irrelevant money.


At times, certain packages allow you to pay as a monthly installment rather than buying the whole package in one single go. Usually, when buyers sum up their money, they realize how the dealers sucked out more money than they were made to believe in the first place.


For the first three years, you would not be even needing any repair insurance as the maker company itself would offer you insurance then why rush yourself in wasting your pocket? Given how most of the time the warranty is not even covering the parts which might be prone to repair in the future, your extended warranty money would remain useless.

In case you do not know how to proceed with it, as it is highly likely that your dealer would slip the mention of it, you can cancel your extended warranty any point of time

Here is how you can secure your money back?

You can cancel your extended warranty at any point in time and you would be able to refund the unused money of your policy. In spite you have taken the loan with your car warranty payment, your annual car payment money would considerably drop. (Win-Win!)

Here are a few considerate tips which you can vary to ensure cancellation process as soon as possible:

  • Read all of your documents: first and foremost, make sure you do not have any hidden lines of third-party warranties slipped in your documents without your knowledge. In case you find one, immediately write up to the company it was done without your acknowledgment.
  • Be upfront and firmly say No and be mindful that when you are talking to the dealers, you are also taking away the commission they earned upon the policy you purchased. Beware of being transferred to the retention department, which is specially trained in convincing the customer’s no to yes. In such a case You would need to stick by your word as firmly as possible, you are not subjected to justify your answers at any cost.
  • Make sure you are handling your cancellation in writing, nothing verbal. Ensure that your document has multiple copies in your store, just for future references.
  • You might want to keep budging them by constant reminders and follows up on a weekly basis.

Concluding to say that everyone should not opt for canceling their extended warranties. It might be working for you, or you might have had similar better experiences previously.

Some things are there just to secure your peace of mind and that is at times worth more than any tag price. Cars can be ‘doozy’ once in a while so you never know what your odds can be!

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