When purchasing a heavy duty (Class 8) truck, whether new or used, buyers don’t expect a breakdown. But should that occur, the concern becomes: how much it will cost to repair the problem.
That is largely unpredictable. Even with a good preventive maintenance program, it’s not possible to know how a truck is going to perform in the future.
Warranties are purchased to give some peace of mind and protect, at least in some way, against an unforeseen occurrence, like an engine breakdown that could require a major overhaul, for example.
When some people hear “vehicle warranty,” they automatically assume it is “bumper-to-bumper” protection, says Steve “Bear” Nadolson, heavy duty truck program manager, American Guardian Warranty Services (www.agwsinc.com), a company that offers administrative, insurance, reinsurance and data processing services to dealers in the auto, RV, powersport, marine and commercial trucking industries. But, that’s not the case, at least not in the Class 8 market.
Warranties are very specific in what they cover, and they can be complicated, he points out.
When purchasing a warranty, it’s important to keep in mind that warranties vary from company to company and are different – in type, length or mileage – in the OEM sector and the aftermarket, says Nadolson. With both OEM warranties and aftermarket warranties – which cover a vehicle beyond the manufacturer’s warranty, there is no true “standard” and they are sold on a truck-by-truck basis, which can add a layer of complexity.
OEM Versus Aftermarket
Every new heavy duty truck purchased from a manufacturer comes with a standard new truck warranty. It guarantees that the manufacturer will pay for the repairs necessary to fix an approved malfunction if one does occur, under certain terms and conditions.
With aftermarket coverage, if something malfunctions within the warranty period that doesn’t necessarily mean it will be covered. That’s where the contract comes in. The terms and conditions, including length of coverage and mileage coverage, are spelled out in the warranty contract.
Once an aftermarket warranty is purchased, the coverage cannot be “extended” after the fact, Nadolson of American Guardian says.
At the time of purchase, however, an extension can be added, that, for example on the used truck, can run from one to five years or 500,000 to more than a million miles.
Read and Understand
Most people never read the terms and conditions of a warranty, nor do they know what their warranty covers until the time of a breakdown, notes Nadolson. With so many options and varying types of coverage, it’s important to take the contract details into account at time of a warranty purchase, he counsels. Knowing what is covered, and not covered, can save surprise and frustration in the long run.
Nadolson cautions buyers on relying too much on the warranty salesperson to explain the contract. In addition, do not assume that any warranty automatically means bumper-to-bumper coverage, because categorically, that’s not the case.
The onus is on the buyer to read the contract and to understand the warranty’s terms and conditions, and “this is very essential,” he says.
Disclaimer
Most companies use a disclaimer in warranty contracts, Nadolson of American Guardian Warranty Services says.
“We, for instance, provide the selling dealer a customer responsibility form and they in turn have the customer sign off on the contract,” Nadolson says. “This protects the selling dealer from things like a lawsuit when someone says to the dealer, ‘You didn’t tell me that.’”
A believer in disclosure, he says some salespeople don’t take the time to disclose every part of the contract, so it’s important for buyers to do their due diligence.
Aftermarket Warranty
Typically, aftermarket warranties comes into play in two instances:
- When a truck’s OEM warranty has run out.
- When a truck owner is purchasing a used truck and wants to safeguard against expensive, unforeseen repairs and problems.
There are about five major heavy duty truck aftermarket warranty companies, says American Guardian’s Nadolson. Several OEM engine manufacturers offer aftermarket warranties, as do some used truck dealerships. Coverages – both time and mileage – differ, and some companies offer additional services, such as roadside assistance and towing.
There are several key considerations when purchasing an aftermarket warranty to assure that the truck purchaser gets the best return on their investment, he concludes. These include:
- Determine what level of coverage is best for your particular situation.
- Know what is covered and what's not covered. (Read the contract)
- Are additional services, such as roadside assistance and towing, included in the contract? Or, can they be purchased separately?
- Deal with a reputable organization.