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February 2019

Insurance Policy or Vehicle Service Contract?

Vehicles today are increasingly complex, especially with all the new electrical components, and Canadians are looking for more and more solutions to protect their investment.

For decades we have all associated the term “bumper to bumper” with new vehicle warranty, and while it still remains undefined, the term suggests that everything between the bumpers is covered under warranty. In reality, you will be hard-pressed to find such coverage in writing from any of the major vehicle brands today, or from any insurance policy.

Extending the manufacturers’ warranty

Vehicles come with a warranty of 3 years and 60,000 km, 4 years and 80,000 km or 5 years and 100,000 km, depending on the manufacturer (check out our blog on what each provides). When it’s time to extend the warranty, a consumer can decide between an independent insurance policy (think of house or car insurance) or vehicle service contracts (warranties like you’d see at a store such as Best Buy), or VSC for short, from the manufacturer.

Be aware that a VSC is different from the original manufacturers’ warranty — it isn’t an extension of the exact same thing, and they can be open to a lot of interpretation. Here are some examples of what you could be looking at:

  • GM Total Plus (VSC)
  • BMW Certified Series (VSC)
  • Mercedes Benz Certified Series (VSC)
  • Toyota Extended Care Plan (VSC) (available in Silver, Gold and Platinum)
  • Acura Plus Plan (VSC)
  • Honda Plus Plan (VSC)
  • Ford Care (VSC) (which has many different levels of coverage)
  • Audi Certified Plus (VSC)
  • Other third party providers of VSC and insurance

The list goes on and on. So, how do you know which warranty to chose? Let’s face it: the automotive industry is a marketing giant, and when it comes to extended warranties, they have flashy brochures often listing hundreds of components you have never heard of. But the reality is you should be most concerned with what’s NOT covered to make the decision.

After all, when you need to make a claim the brochure is out the window, and the small-print policy wording is called upon. It’s time for a transparent approach to extended warranty, one which provides great coverage all with easy-to-understand exclusions.

Does buying an extended warranty from the manufacturer provide “bumper to bumper” coverage? No.

Canadians need to read and understand the policies they’re looking at. They should be considering the following when buying an extended warranty:

  • Are you getting warranty advice from the warranty provider or a commissioned dealership sales office?
  • Where can the vehicle be repaired?
  • What is the KM coverage? How many extra years does it provide?
  • Who is assisting you during a claim?
  • Financial stability, usually best served by an insurance policy.
  • Can you transfer the policy?

To summarize: “bumper to bumper” is another way of wording extended auto warranty. It never mean that literally everything is included, although that’s what it sounds like. Always make sure you know whether you are looking at an insurance policy or a vehicle service contract, that you understand what you are reading and are happy with what is covered.

Learn more about Obvi’s Extended Warranty and how our policies do things differently, or get a fast and free online quote with the button below:



Best Extended Car Warranty Company

Best extended car warranty company

Best extended car warranty company

When buying your extended car warranty, it’s important to make sure you have chosen a trustworthy and reliable company. How do you know what is the best extended car warranty company?

Understand the market

It’s a good idea to do some research and understand what is going on at an industry level when researching a company. For example, when looking for the best extended car warranty company, you need to understand that there are different places selling car warranties with differing motives.

The traditional method of car warranty sale in Canada is through the dealership when purchasing your car. However, this can come with many issues as salesmen are often motivated by making a quick high-pressured sale as they could earn up to 75% commission on extended warranties. They are not the business that will be dealing with you in the event of a claim and generally don’t have expertise in the product they are actually selling. The other option is going with an online company which are becoming more common. Many negative issues can be eliminated going this route. There is low sales pressure, you can deal with the same company when making a claim and cut out the middleman taking that big fee that you used to pay. When researching a new vehicle and warranty and the company providing it, it’s important to see the bigger picture and understand what kind of warranty you are getting and what process you are comfortable dealing with.

Word of mouth

If people you know and trust are telling you that they have had a great experience, this is a good way to get an introduction to a company which you can then find more information about online. Particularly when a company is new, word of mouth is really important because a new company may not have a lot of reviews yet.

Read reviews

Always check for reviews and read as many as you can! It’s important to see what customers are saying about a company, and whether or not they had a good experience. Having a few negative reviews isn’t necessarily a bad thing, after all you don’t know how trustworthy the reviewer is, but check to see if the company responded. An offer to resolve the issue, offer an explanation and apologise is better than ignoring the bad review. However, if there are numerous bad reviews and there is a recurring theme, be aware that you might experience the same issue.

Chat with or call them

Don’t hesitate to get in touch with the company if you have questions. A good extended car warranty company will respond quickly and have helpful customer service agents that are experienced and able to help you. If you don’t find that this is the case, it might be a warning sign!

We think Obvi is the best extended car warranty company

Obvi is completely changing extended car warranties in Western Canada. It’s eliminating all of the pain points that customers experience when buying at the dealer and providing warranties at a fair price by bringing it online. Obvi extended warranties provide a low pressure engaging process where you can take your time to research and read the easy-to-understand policy.

Find out more info about Extended Warranties here or get a quick & easy quote now.