What Is a Vehicle Service Contract? (2022) – MarketWatch

August 3, 2022 by No Comments

A vehicle service contract (VSC) is a paid plan that helps cover auto repairs after your car’s factory warranty expires. Also known as extended car warranties, these protection plans can help owners avoid the stress of expensive repair costs.

In this article, we at the Home Media reviews team explain what a vehicle service contract is, what it typically covers and how much you can expect to pay for this vehicle protection. We’ve evaluated the best extended car warranty companies to help you find the most suitable option for you, and we recommend comparing free quotes before deciding on a vehicle service contract.

Vehicle Service Contracts Overview

While a vehicle service contract may also be called an extended warranty, it doesn’t actually extend the factory warranty coverage from the vehicle’s manufacturer. Instead, a third-party provider typically covers specified repairs.

You have many coverage options when it comes to vehicle service contracts. There are plans that mirror powertrain warranties, covering only the engine, transmission and drive axle. You can also find vehicle service contracts that are similar to the bumper-to-bumper warranties that come with new cars.

Depending on the provider and plan you choose, you may get coverage for any of the following vehicle components:

  • Air conditioning
  • Electrical system
  • Brakes
  • Suspension
  • Fuel system
  • Entertainment system
  • Navigation system

Common Exclusions in Vehicle Service Contracts

As with factory warranties, vehicle service contracts don’t cover every part of a vehicle. Read the fine print in the contract before you purchase a vehicle protection plan so you know what is and isn’t covered. Here are some common exclusions:

  • Wear-and-tear items such as tires and brake pads
  • Damages from a lack of routine maintenance
  • Damages caused by modified components
  • Damages caused by non-covered parts
  • Damages caused by collisions, environmental factors or vandalism

Vehicle service contracts also won’t cover preexisting issues. That’s why most providers have a waiting period before coverage goes into effect.

What’s covered will depend on your choice of plan. If you want maximum protection and peace of mind, it’s best to find an exclusionary plan that covers everything except a short list of components.

Added Benefits of Vehicle Service Contracts

Many vehicle service contracts feature perks at no additional cost. These are the most common added benefits:

  • 24-hour roadside assistance: Lockout assistance is often included, as well as battery jump-starts and fuel delivery when you run out of gas.
  • Rental car reimbursement: When your car is in the shop for covered repairs, many plans help you with rental car costs.
  • Trip interruption protection: If you have a covered breakdown more than a specified distance from home, this benefit helps …….

    Source: https://www.marketwatch.com/picks/guides/auto-warranty/what-is-a-vehicle-service-contract/

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