Car warranty

Whether you buy a new or used car, if your vehicle develops mechanical faults during the warranty period it may not be you that has to pay for repairs. Find out more about how car warranties work with the help of our guide.

Whether you buy a new or used car, if your vehicle develops mechanical faults during the warranty period it may not be you that has to pay for repairs. Find out more about how car warranties work with the help of our guide.

Kate Hughes
Car insurance expert
8
minute read
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Posted 11 NOVEMBER 2019 Last Updated 8 MARCH 2022

What is a car warranty?

A car warranty is a form of insurance. It covers the cost of parts and labour if there’s a mechanical or electrical fault with your car during an agreed timeframe. However, you’ll need to make sure your car is maintained in line with the terms of the warranty. Otherwise any claim may be rejected.

It can be provided by manufacturers and retailers, as well as third-party car warranty providers and insurance provider.

Unlike car insurance, a car warranty isn’t a legal requirement.

What is a typical car warranty? 

Typically, new cars will come with a manufacturer’s warranty that’s valid for three years or 60,000 miles, whichever comes first.  

Some manufacturers offer longer warranty periods. Hyundai, for example, offers a five-year, unlimited mileage warranty, whereas Kia’s is for seven years or 100,000 miles. 

If you’re not happy with the length of the warranty you’re given, you could pay for an extended car warranty when yours is about to expire.

Where can I get a car warranty?

If you’re buying a new car, it’s likely to come with a manufacturer’s warranty as standard, so you shouldn’t have to worry about that. 

If you’re buying your car from an independent dealer or garage, then you can choose to buy an independent warranty provided by another third party. These are also known as aftermarket warranties and it’s completely up to you whether you buy one. If you do, check all the terms and conditions of the warranty, because they can be far less comprehensive than official manufacturer’s warranties.

Can you get a warranty on a used car?

If you’re buying a used car from an official dealer, you might get a used car warranty as part of the deal. You shouldn’t assume this to be the case, though, so always check. Used car warranties are usually much shorter than the manufacturer’s warranty, typically only lasting between a few months to a year. 

If you buy a car that’s less than three years old, then you may have some time remaining on the standard manufacturer’s warranty. But a warranty isn’t limited to the new car showroom. It’s also possible to buy a used car with a warranty. As part of their own ‘approved used car’ schemes, most franchised dealers typically offer a 12-month warranty. You may need to have your car serviced at the dealership you bought it from, or a franchise, for that warranty to apply.

Some second-hand dealers may also offer three, six or 12-month warranties as an incentive.   

If you’re buying a car from a private seller, you’re really buying ‘sold as seen’, though be reassured that it’s at least illegal to sell a vehicle that isn’t in a roadworthy condition. It’s possible to buy an aftermarket, third-party used car warranty for cars up to 12 years old, although they do tend to have more exclusions than a manufacturer’s warranty and, as a general rule, the older the car, the higher the premiums.

Read our checklist for more advice on buying a used car.

How much does a car warranty cost?

This depends on a number of factors, including:  

  •  your mileage 
  • make and model of the car 
  • age of the car 

Warranties for more expensive or older cars are likely to cost more.   

The price of your warranty may also depend on the level of cover you want and how long you want it to last for.   

Different providers may offer you lower prices, so you shouldn’t feel obliged to go with the manufacturer or dealer warranty. Shop around to make sure you’re getting the right deal for you.

What does a car warranty cover?

Warranties differ according to the manufacturer or provider, so you’ll need to read the policy details carefully to make sure your repair bills will be covered. 

Terms may also differ for electric or hybrid cars. 

As part of a typical car warranty, you’re likely to be covered for the cost of repairs for mechanical breakdown and electrical parts including:

  • Engine
  • Transmission system
  • Steering
  • Suspension
  • Clutch
  • Brake system
  • Gearbox
  • Electrics
  • Air conditioning system 

Be warned, though, the warranty may not cover the component parts of the vehicle for the same period of time. For example, although Kia’s warranty is for seven years, the cover for batteries is only for two. 

What isn’t covered by a car warranty?

Don’t assume your car warranty will cover you for every kind of fault you encounter during the warranty period either.  

Depending on the kind of warranty you have, things like these may not be included: 

  • General wear and tear, like worn tyres, brakes and windscreen wipers. 
  • If your car suffers accidental damage, these costs would fall under your insurance, rather than a warranty.
  • If your car’s the victim of vandalism. This type of claim would also fall under your insurance.
  • Most warranties will state that you must take reasonable care of your car and that you could invalidate it if you don’t take your car in for regular servicing. 
  • You may be expected to only use garages approved by the dealership for repairs and servicing – an issue that often trips car owners up when it comes to claiming against a warranty.
  • Any  modifications to your car could invalidate your warranty, so it’s a good idea to check before you add that super-sized rear spoiler.

What else should I look out for when buying a car warranty?

Like any legal and/or financial agreement, always check you understand the small print in your warranty. It often contains a bewildering array of jargon, so here’s some examples that you might want to familiarise yourself with before signing on the dotted line:  

  • What is betterment? 
    If your car ends up getting a part that is ‘better’ than the part it’s replacing, you may be expected to pay for it or at least contribute to its cost.
  • What is consequential loss?
    This is when a part that’s insured fails because of the failure of another (uninsured) part. Ideally, you want a warranty that will cover you for consequential damage, otherwise you’ll be expected to pay for some or all of the part that needs replacing.
  • What is garage choice?
    Some policies and insurance providers may have a list of ‘approved garages’ that you’ll need to use, otherwise you’ll face paying towards their labour. 
  • What is labour rate?
    The labour rate refers to the garage’s hourly rate and how much of it your warranty provider will pay towards.
  • What is the excess?
    The excess is the agreed amount that you’ll need to pay towards repairs when you make a claim. The insurance provider will pay the rest.
  • Insured vs uninsured warranties
    It's important you understand the difference. Insured car warranties are regulated by the Financial Conduct Authority (FCA) and are members of the Financial Services Compensation Scheme (FSCS). This means, if your warranty provider goes out of business, your warranty and car are still protected. Uninsured car warranties are not regulated in the same way, which may mean they’re at greater risk.

Could my car warranty claim be rejected?

Yes. There’s quite a few reasons why your warranty claim could be rejected. Here are some examples: 

  • You’ve neglected the car – if the car isn’t properly maintained, serviced or had its MOT, this will likely break the terms of your warranty, which means you won’t be covered. Take extra care when you do get the car serviced, as you may need to have the work done by an approved garage. Other examples include using the wrong fuel, which leads to issues that then won’t be covered, or driving with a warning light or known fault without getting it checked.
  • Improper use – if there’s evidence that you’ve not been using the car appropriately (for example, taking it off road when it’s not suitable), then you might find you’re not covered.
  • The parts to repair aren’t covered – depending on the type of warranty you have, you might find that certain things aren’t covered. Manufacturer’s warranties tend to be among the best, but you should take extra care when taking out an aftermarket warranty for a used car, or even warranties from official used car dealers.
  • You’ve modified the car – if you’ve made modifications to the car after taking out the warranty, this may cause an issue. If the modifications led to the issue you’re claiming for, your claim will probably be rejected.
  • Acts of God – if you’re claiming for damages relating to flooding or other natural disasters, you probably won’t be covered.

Is it worth having a car warranty?

Warranties can provide peace of mind, but how useful they are depends on the warranty you have. Cheaper warranties may have a lot of exclusions, but a comprehensive warranty may be more expensive. 

Some warranties also include breakdown cover, so you might want to factor this in when it comes to totting up the cost of buying a car with or without a warranty.

Is a used car warranty worth the money?

If you’re buying a used car through a dealership, you may have the option to purchase a warranty or extended warranty via the dealer. The warranty will usually be through a third party, rather than the dealership themselves.

 If you don’t trust the reliability of the car or you just need reassurance, a warranty could offer you extra peace of mind. However, you need to be clear about exactly what the warranty will cover, which means looking very carefully at the small print. You also need to weigh up the cost of the warranty in relation to any repairs you might need to make to the car. It might work out cheaper just to pay for any repairs up front. 

Remember, if you bought the car, new or used, from a recognised dealer, you’re also protected under the UK Consumer Rights Act 2015 that applies for six months, independently of the warranty. 

This states that the car must be of satisfactory quality, fit for purpose and as described. This means that: 

  • You have 30 days to claim a full refund, repair or replacement.
  • If a fault surfaces between 30 days and six months, you should be able to get a partial refund, a repair or replacement.
  • After six months, it’s up to you to prove that the car was faulty when you got it. 

Finally, for up to six years after the purchase, or five in Scotland, you can even take legal action for breaches of the Consumer Right Act. Just be sure it’s worth pursuing.

How can I find the best car warranty? 

If you’re looking for the best car warranty, make sure you’re clear about what it means and that you’ve done your research, before signing any paperwork. The best car warranty for you may not be the best for someone else, so you need to decide what’s most important for you. That could be price, level of cover or the length of warranty. 

To help you find a great price, you can compare warranty prices online. Comparing prices will allow you to pick and choose the things you want to include in your warranty. For instance, you may be able to set the claim limit or the voluntary excess.

Warranty or not, you’ll always need car insurance

While you’re deciding whether to choose a model with or without a warranty, take the time to find out how much your insurance will cost you. We’re dedicated to helping you find and compare the right car insurance to suit your needs. 

Comparing car insurance quotes with us could save you up to £267^^ on your premium and will only take you a few minutes.  

^^ Based on Online independent research by Consumer Intelligence during May 2021. 50% of customers could achieve this saving on their car insurance through Compare the Market.

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