Why NOT to Buy that Extended Warranty?

Discussion in 'Clarity' started by kunz427, Oct 31, 2018.

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  1. maguzma

    maguzma New Member

    When I help friends purchase new or used/lease cars they often ask about extended warranties (maintenance,engine, tires etc.). I generally ask how long they expect to keep the car, then I ask them have they done their research on common problems with the car (out of warranty) and average cost of the services/maint. Most of the time it doesn't make monetary sense. However, if the car is a high end or luxury car/suv and if they do the same analysis, about half of the time extended warranties are a good investment.
    But since the average American keeps their cars for 3-5 years, it's hard to determine if extended or upgraded packages are needed. But since Clarity type cars are new to Honda and seeing some common problems on forums, I would have to do some serious research to determine if an extended service/car warranty is needed after standard expires.
    I knock on wood, my last three leases where error free but in 2009 I purchased a 2008 Infiniti M35 and decided to purchase extended service warranty (48 months 36K miles for $828.00) and it worked out great. It seemed close to the end and early after the normal warranty a lot of issues happened that saved me a lot of money. First the radio stopped working so the dealership had to swap out the entire center console entertainment system (at no charge), shortly there after my cooling system had to be replaced. Then the internal chrome trip faded so it had to be replaced. The dealership never contested nor made a big deal but always fixed any problems my car suffered. The dealership thought I put water in the radiator in stead of coolant and asked if I did but it must of been at the dealership I purchased, they still replaced. Before I sold the car (and transferred the extended warranty) total cost of work outside of warranty was close to $4,900 but it only cost me about $950 out of pocket (that included extended warranty cost and deductibles). In the case of my infiniti, purchasing the extended warranty (after I owned the car for two years) was a great investment.
     
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  3. KentuckyKen

    KentuckyKen Well-Known Member

    Tim, I absolutely agree with your points and would not have purchased without the offset from cancelling AAA. As an old guy recovering from a bad motorcycle wreck, my days of working on a car on the side of the road are long over. So I have to have some form of roadside assistance. That’s why I subtracted out the AAA. I understand that doesn’t wash for others.

    But the point of insurance and any evaluation of its benefit is not how many people will end up receiving more paid out than they paid in. As you mentioned that’s not going to happen without those actuarials taking a Great Depression like plunge off their skyscrapers. The point of insurance is to eliminate the liability of having a large expense. And of course each person must determine what they consider is too large a potential expense to self insure.
    I wasn't rationalizing, just explaining why my scenario makes financial sense. And I guess that would be more accurately stated as financial sense to me in my situation.

    I hope none of us has to have any repairs done after 3 years because IMHO there’re most likely to be very expensive given what a whiz-bang computerized electronic marvel our Claritys are.
     
  4. KentuckyKen

    KentuckyKen Well-Known Member

    Hmmm...
    Let me redo the Jethro math on this...naught times naught equals naught, carry the naught and...
    Dang, now it doesn’t make sense to me either and I typed it! I think you gave me way too much credit for always being logical.

    I think I illogically subtracted $340 not spent on my covered repair from the $680 originally spent for the ext warranty to erroneously say now I’m only out $340. That is indeed wacky math. Can I blame that on the NewMath that came out in the 70s or maybe the closed head injury from my son’s motorcycle.

    Anyway, you are correct. If a self insurer has less than than $680 ( my cost after subtracting savings from AAA cancellation) in repairs in those last 5 years the he has beaten me like a rented mule from a purely financial standpoint.
    May I reduce the breakeven to around $400 to $500 by counting an out of town tow to get home or a local tow and hotel while on the road? Just trying to save a little face here.

    In my own defense, I was left unsupervised during that post.
     
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  5. Agzand

    Agzand Active Member

    I agree with what others said for and against the extended warranty. I just want to add the fact that HondaCare warranties are well priced. Even if you look at the average owner, they will probably end up paying just a small amount less than the warranty price. So when you make this decision, it is not comparing zero out of pocket vs. $1100-$1300 for hondacare, for an average owner not getting the warranty will save a few hunderd bucks.
     
  6. JulianClarity

    JulianClarity Active Member

    I got the $1310 6/120k extended warranty. I got the car cheap and I plan to drive it a lot, a new car, new transmission and high mileage will bring much higher chance of failure, the money buys me peace of mind.
     
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  8. insightman

    insightman Well-Known Member Subscriber

    On the humorous side of extended warranties: I enjoy reading the stories on Jalopnik.com where they take advantage of CarMax's extended used-car warranties. Jalopnik chooses an expensive car that's known to be wildly unreliable, purchases one of those cars used from CarMax at a much-lower price than new, and also purchases a long-term, bumper-to-bumper CarMax warranty. As expected, the car breaks down over and over and CarMax pays for the repairs--it's amazing how unreliable some expensive cars can be! The purchaser gets to drive an expensive car for a lot less money than would be possible otherwise, but has to put up with frequent repairs and the attendant loss of utility while the car is in the shop. We get to enjoy the story of a company that thinks they've got the extended-warranty game all figured out losing their shirts on these outliers. Here's a Jalopnik story about a Land Rover halfway through it's $3,900, 66,000-mile extended warranty that has already saved the purchaser more than $6,000. I doubt any Hondas cause CarMax's insurance underwriters similar regrets.
     
  9. Lowell_Greenberg

    Lowell_Greenberg Active Member

    I purchased the Honda Care extended warranty today. Generally I am no fan of these warranties. However, the concept of a wrap around approach has some appeal to me. Covering everything for 6-7 years seems reasonable.

    But to he honest, and I hope I am wrong- I have concerns about longer term reliability (over 3 years) with the Clarity. Even troubleshooting software glitches that may impact critical systems takes time and money- and I am not yet confident all the bugs in the Clarity's electronics have been worked out. It would probably be a miracle to have cars like my 1989 Accord or 1981 Civic as far as reliability. But then again, they couldn't deliver 100+ mpge at a weight of 2 tons and still manage an under 8 second 0-60 and incorporate advanced safety features, and...

    Sent from my SM-G975U using Tapatalk
     
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  10. JulianClarity

    JulianClarity Active Member

    Huh, that takes a revolution in science to bring all your wishes into reality.
     
  11. Lowell_Greenberg

    Lowell_Greenberg Active Member

    Now I am confused. The Clarity does everything I listed. I simply questioned its reliability as compared to Honda's of the 1980s and 90s.


    Sent from my SM-G975U using Tapatalk
     
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  13. dannieboiz

    dannieboiz New Member

    I'm on the fence on this one now. I paid 1500 for an 7yrs 80k bumper to bumper warranty. Since I'm in CA, the battery is good for 10yr/150miles and the dealer I purchased it from offered the lifetime honda powertrain warranty. I'm really questioning the value of the warranty I paid for. I'm still in the grace period and debating on if I want it or not.
     
  14. KentuckyKen

    KentuckyKen Well-Known Member

    Unfortunately, Murphy’s Law says if you keep it, you’ll never use it and if you get rid of it, you will have horrendously high repair bills.
    Good luck.
     
  15. Lowell_Greenberg

    Lowell_Greenberg Active Member

    I believe Hyannis Honda can quote this at a $896. However, you may wish to confirm they can sell into CA. They are based in MA.

    Sent from my SM-G975U using Tapatalk
     
  16. Mesa

    Mesa Member

    I didn't buy an extended warranty because I wasn't sure how long I would keep the car. My reasoning was that I already have a 36K mile bumper to bumper warranty. So for the first 36K miles, you get nothing. If I decide to keep the car after 36K miles I will look into the cost of an extended warranty to 80K miles. I may have a better feeling for the reliability of the car in 3 years. Right now the difference in the warranty costs between a car with 3K and 35K miles is very little. You can go to Honda Care and run the numbers. Of course the cost may be greater when the car is 3 years old. If I knew I would I keep the car indefinitely when I bought it, I would have probably bought the warranty.
     
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  17. MNSteve

    MNSteve Well-Known Member

    Well, crap. I guess I will never learn not to ASSuME. I did not check this; just assumed that the cost of buying the warranty at 35K would be prohibitive.
     
  18. M. Shah

    M. Shah Member

    Does anyone with a car with over 6K miles and 6 month old got a warranty price check?
     
  19. su_A_ve

    su_A_ve Active Member

    I did it at one time.. but you can easily do it now.. Hyannis sends you the prices automatically.

    But the way it works is the length is from day of purchase and until the stated miles. So max for a 2019 with 10K miles you could get is 6 years 120k miles.
     
  20. M. Shah

    M. Shah Member

    I got a 2 month old 2018 with 2K miles. Debating if I should get the extended warranty now or wait till I get close to 36 months or 36K miles. Is there a price difference in doing it later.
     
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  21. MPower

    MPower Well-Known Member

    When I checked with Hyannis after I went over 6000 miles, the longest they quoted for, if I remember correctly, was 5 years. When I checked at 4700, they offered a plan up to 8 years. You can see what plans are available here: https://hyannishondacare.com/questionnaire.php
    Here is what another online dealer Sarcucci Honda said, which kind of explains the difference:

    All "C" and "D" plans start at the original in-service date, and 0 miles(Vehicles under 6,000 miles).

    All "F" and "G" plans start at contract purchase date(Vehicles over 6,000 miles). Seems like once you are over 6000 miles, you might as well wait until near the end of the regular warranty period.

    If I remember correctly Sarcucci were a little more expensive, but their site is more informative. They have a copy of the contract. https://www.saccuccihondacare.com/coverage.php
     
  22. RickSE

    RickSE Active Member

    I would doubt that it was an over the air update. A lot of time just turning the car off resets the electrical warning messages. If the radio freezes up again just hold the post button for 5 to 10 seconds and do a hard reboot of the unit.
     
  23. neal adkins

    neal adkins Active Member

    In California many repair items will fall in the category of emissions. When i looked into it a saw that emission items are covered for 10 or more years and 150k, i felt better about not getting the ext. Warranty. In reality the ew will be trumped by the emissions warranty on much of the electric system and wasnt worred as much about the ice components.
     

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