Car warranties 101

One of the advantages of purchasing a new car is that it comes with a warranty. It’s important, however, for buyers to understand what exactly it covers. Here’s a brief rundown of what you get with both a basic and an extended warranty.

Basic warranty
Also called a factory warranty or a manufacturer’s warranty, a basic warranty is standard with the purchase of any new vehicle. Typically, it comprises multiple warranties. This includes a bumper-to-bumper warranty, which, as the name suggests, covers just about everything between the front and back bumper. It also includes a powertrain warranty, which applies to the engine, transmission, and drivetrain and is usually more limited.

Note that warranties don’t cover cosmetic damage or normal wear and tear; they cover manufacturing defects that were the fault of the automaker.

A standard warranty lasts between three to five years or 36,000 and 60,000 miles, whichever comes first.

Extended warranty
When you purchase a vehicle, sometimes an extended warranty is given as a bonus, but more commonly, it comes at an extra cost. In most cases, an extended warranty from the automaker is simply an extension of the factory warranty.

However, you may also opt for an extended warranty from a third-party provider, which may offer more comprehensive coverage and perks like roadside assistance.

Note that nothing forces you to purchase an extended warranty right away. You can wait until the factory warranty is about to expire before getting this extra protection.

Warranties differ between car makes and models, so always take the time to familiarize yourself with any car warranty you receive or purchase.