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Mar 17, 2008 4:48 pm US/Eastern
Are Vehicle Extended Warranties Worth It?
(KDKA)
These days more people who are buying a new car are buying an extended warranty.
But is it worth the thousand dollars or so?
Consumer Reports surveyed 8,000 of its readers about extended warranties purchased on new 2001 and 2002 vehicles.
About two-thirds of them said the extended warranty did not pay off.
The extended warranties cost on average $1,000, but only provided an average benefit of $700.
That's a net loss of $300.
Forty-two percent of the people in the survey didn't use the extended warranty at all, mainly because they didn't need repairs or because the manufacturers' standard warranty covered the repair.
If you're buying a new car, Consumer Reports says your best bet is to buy a vehicle with a good record of reliability, so that you can skip the extended warranty.
Consumer Reports can help you find a reliable vehicle.
It predicts the reliability of new cars based on its subscriber survey, which covers more than a million vehicles.
This year Honda came out on top as the most reliable vehicle manufacturer overall.
This report is based on an article in the current April 2008 issue of Consumer Reports magazine, pages 26-29.
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