$1650 for 72 month 125,000 mile Warranty. Is it Worth?

The issue in the US with an automotive service contract is that there is a close similarity to an insurance policy - which, in the US, the insurance industry is seriously regulated. That's because many of these companies were fly-by-night. They'd get lots of money for several years, then go belly-up via bankruptcy, pocketing all of your hard-earned money.

 

I bought the extended warranty when I was pressured by the finance guy at the dealer - a 'today only' kind of deal, which in hindsight was totally terrible. i cancelled it within a couple of days, but unfortunately rather than refunding you the cash, they knock the total off your financing, so I'll end my payments several few months early but my monthly payment still includes the additional amount for the warranty.

He also pressured me to get the 'tire insurance' which seemed like a decent deal until I read the exclusions at home which made it clear that many conditions that might cause tire to blow would be excluded. Cancelled that one too.

 

It's a waste of money. Todays cars are very reliable.

 

I bought my 2017 Prius 4 at the end of December. I worried about two things, a lack of spare tire and whether I should get the extended warranty which I was pressured to buy. Actually when I went to see the financial advisor, he had already added the price of the extended warranty to my monthly payment. They gave me some "fake money" which they said reduced the price of the extended warranty. I declined the extended warranty so they had to rework my payments. I thought about getting it later and paying cash for it. Well, it is now 3 months later, I love my Prius. I never bought a spare tire and I never bought an extended warranty. If I ever take an out of state trip, I will consider getting a spare tire from Discount Tires, mounted and balanced for $125 that I will put in the cargo area and around 24,000 miles or 2 yrs I will decide if I need an extended warranty. BTW, I went on a fairly long drive with a friend of mine. I told her that if I get a flat, she will be inconvenienced because I did not have a spare. She said that was fine. She drives a Mercedes and she does not have a spare either!

 

The Merc probably has run-flat tyres, though. When I looked at them 2 yrs ago, that was the case.