Extended Warranty

There's definitely flex. I got a lower mileage platinum 6 yr/75,000 extended warranty for $500. I NEVER buy extended warranties for anything, but that seemed like a good deal to me on my Prius V 5 w/ATP.

 

We bought a Prius V on 5/18/12 and the dealer told us that the cost of the warranty would be refunded at the end of the warranty period provided that the warranty wasn't used. Has anyone else been offered this type of platinum coverage.

 

I wasn't. Will the dealership do this or Toyota? I would think the dealership but maybe I missed something. I do know warranties are refunded if canceled. W

 

It is a separate insurance policy that dealers can by for this. There are companies out there who will insure for this type of scenario.

 

If the rare event happens to you, buy the widget lightly used. No worries.

 

My understanding was that you can cancel the warranty but you would only get the pro-rated un-used portion of the cost back in return. If that really is true that you can get the full cost refunded at the end, that would be an amazing warranty. I'm doubtful though because that would go against the very nature of an warranty-type product. They simply wouldn't make any money!

 

It does not. No 'wear' items are covered.

 

I like the peace of mind of money in my pocket and not the dealers.

 

I got something similar when I bought my last car (a Honda). I was confused after purchasing it and did a lot of research to find out what exactly I had bought!

The way it works is that the dealership charged you a mark up on the extended warranty. They make a pretty large profit on it. They then use part of the profit to buy an insurance policy on your warranty. If you never use the warranty in any way, then the insurance policy pays up at the end of the term of the warranty and you get the full cost of the warranty back. The insurance company is unrelated to Toyota. If you use the warranty in any way during the term, the insurance does not pay a cent. Also note that there is a time limit after the end of the warranty period to make your claim. I think it was something like 45-90 days after the warranty expires. You also cannot claim it before the warranty expires, so the window for making the claim is narrow.

Apparently, it works out for the insurance company because (1) some cars need to use the warranty and (2) most people will not keep their paperwork and remember to claim the insurance at the end of the period (5-7+ years later!)

I kept my paperwork in a special folder and put an appointment into my calendar five years into the future. When the time came (last Fall), I called my dealership, they gave me the insurance company's phone number, I called and got a claim form. Filled in all the details and waited. I waited about 3 months for them to check with the dealer that no claims had been made against the warranty. I called the insurance company a couple of times just to make sure they were working on it and they finally delivered the full price of the warranty back to me.

I was lucky that my Honda never needed the extended warranty (it did have a transmission problem, but that was during the original warranty period). I would also say that there was a fair amount of hassle chasing the insurance company and the reps I talked to there were aloof and not friendly. I got the sense that they did not have to deal with claims very often!

So it works out well for the dealership (who made a large profit).
It apparently works out well for the insurance company in aggregate.
It can work out well for the consumer if nothing goes wrong with the car and they keep diligent records and track the time. But if you need to use the warranty or forget to make the claim, it will have turned out to be an expensive extended warranty.

Hope that helps!

 

I usually dont get extended warranties, but with the Prius I did. Usually, something or other always, always happens to cars.And I have at least three mechanics friends who help me. However, not a single one of them knows how to even begin to fix a hybrid car. Most of those local mechanic shops refuse service to hybrid cars because they dont know what to do, either. You gotta go to an overpriced place like firestone or the dealership, and i figured if im gonna have to go to the dealership anyway, might as well get the warranty.

 

I don't suppose a person could be more confused. I want to buy an extended service warranty, Platinum, I guesss it's called. But I don't undersatnd about it being refunded in the future, or if it's a good deal to get one--- or why my dealer wants soooooo much money for it. They quoted me today for 2100 for one or 2400 for another. ????? No way. I wn't do it. So I guess I need to search around, but I'm not even sure if I"ll wind up wiht a charlatain. I do get the feeling my dealer is over-charging me.

Jen

 

Toyota will not refund a warranty other than sometimes when it's brand new, certainly not after you drive 100,000 miles without needing it. You can buy the 125k Toyota warranty for about $1200 through Toyota dealers elsewhere; two are listed on this forum.

Some people buy the inflated cost version (like $2100) and then find out they can buy the same thing for less. Those are the buyers looking for a refund from their original dealer. Overall the odds are in Toyota's favor that you won't even get $1200 worth of repairs. But some do benefit and some like the comfort factor of having the extended warranty.

Finally, you have until 36,000 miles to buy an extended warranty, eg you can buy it until your factory warranty expires. Only possible downside would be increased prices down the road.