Aftermarket automotive warranty contracts have many components and I really tried to explain the most important of these in the previous articles. The consumer must understand that when they want to place coverage on a vehicle that is out of manufacturer warranty, they are warranting a used car. When a repair is necessary, do not be surprised if your warranty company requests that the repair be made with used, remanufactured, or non-OEM (original equipment manufacturer) parts if possible. They may try to source parts from junkyards, re-builders, or aftermarket parts companies. As the consumer, you need to understand and accept that this is the way most third party warranty companies work. It is not to say that your coverage will not cover the cost of new parts, it most definitely will. If a cheaper alternative is available, the warranty company will use it. In this area, warranty coverage can be compared to insurance coverage. In recent times, most insurance companies have included or revised their contracts to include a used or aftermarket parts usage policy.

     Transferring your extended warranty contract can usually be done in two ways. In the event you sell your vehicle, you can transfer the policy to the new owner under the terms of your contract. The contract will usually state the maximum amount of time after the sale which the transfer can take place in. It will also state the fee, if any, and procedures to complete the transfer. Some companies will allow you to transfer the coverage to a different vehicle if you change cars for any reason. This transfer procedure also varies between companies but is usually an option. Most contracts are valid at any licensed repair facility. It is always better to go to a repair facility that you are familiar with or that is recommended by the company itself. If the repair facility and your warranty provider have done business before, then you have a better chance of your claim being handled successfully.

     As stated in a previous chapter, depending on the labor rate that your contract allows, you may want to have your car repaired by an independent mechanic, where rates tend to be lower then at a manufacturer's dealership or national chain.

     Your contract will also outline the repair facility's procedures for filing a claim. As the contract holder, you should be familiar with these procedures for two reasons. You will be able to inform your mechanic of what he/she has to do in order to obtain payment for the repair, and you will be sure that the procedures your repair facility is taking are proper. Extended warranty contracts will never cover collision, fire, theft, vandalism, lighting, natural disasters, abuse, or anything else that may happen to your vehicle other then legitimate failure of covered components. Automotive insurance is needed to guard against all other unfortunate occurrences.