Consumer Reports: Skip extended car warranties
Survey shows majority don't use them
A Consumer Reports' survey of 12,000 subscribers found extended car warranties are an expensive gamble.
"We found that more than half the people who bought an extended warranty never used the coverage," said Jim Travers with Consumer Reports. "And, even among those who did, they spent far more for the coverage than they saved in repairs."
The cost of an extended car warranty averaged $1214. Among those who used it, the median savings was $837, a net loss of $377.
The owners of Hondas, Subarus and Toyotas were especially disappointed with their extended warranties, and less than a quarter said they would buy one if they had it to do over.
"Hondas, Subarus, Toyotas, those all tend to be reliable brands to begin with, so the odds are those people really had even less need for their extended warranties," Travers said.
Ed Rinaldi is among that group. When he bought his Honda Pilot, he bought the extended warranty.
"I paid $1800 for this warranty, and it turns out I never really needed it whatsoever," Rinaldi said.
The Better Business Bureau has received thousands of complaints about extended warranty scams. Consumers are advised to check with their dealer to see if offers they are considering are legitimate.
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