Extended warranties have of course been discussed to no end. I almost never buy extended warranties on anything.

Having bought my Skoda Octavia combi Scout (last of the MkIII, 2020 model year, delivered in September 2020, 2.0TDI DSG-7, Haldex 4x4) and seeing the enormous complexity in modern cars, I wonder. (There's just so much more than can fail, and everything is more complex - and therefore more expensive).

I did not take out "Longdrive" nor any extended warranty when I originally bought the car new. I follow scheduled maintenance scrupulously and take good care of my cars.

 

The only real reason that I'm considering an extended warranty now is that, at 32000km and a bit less than two years (the statutory warranty here in Spain is two years and something like 50000km) the transmission has developed an intermittent "clack" when gradually descending the gears. Of course, I'm taking it to the shop (under warranty), and we'll see what they say, and I shouldn't end up out of pocket for this.

 

But if anything at all is happening to the transmission at this young age which it totally shouldn't, (I drive my cars gently, mostly on highway, but I do also use my Scout as a Scout - on unpaved sometimes steep, somewhat rough roads), then I begin to worry that something expensive might happen in the few years following the end of the statutory warranty. 

 

The offer the VW Financial Services here in Spain make for an extended warranty on this car (starting from the end of the statutory warranty at the end of the initial two years) is either:

* Everything (other than wear & tear or abuse) for years 3-5, then "functional" things for years 6-8, then only major mechanical in years 9-10; for €28,53/month same price for up to the whole eight years during which this is buyable; or

* Major mechanical only, for €23,43/month.

* (There's also an intermediate step which is the "functional" level from year 3 rather than the "total" level for years 3-5)

 

The ultimate limitation on this extended warranty is that they'll never pay more to repair something than the write-off value of the vehicle; they declare the write-off value to be €2000 at 200000Km (I drive less than 20000Km/year, and I found a used car value for a representatively similar vehicle at 7 years and 130000km of around €9000, so if the engine went in the last year I'd still expect it the value of the car to be more than the cost of e.g. an engine replacement).

 

So, concretely, for the Octavia Scout, 2020 model year, 2.0TDI engine, DSG-7, 4x4 Haldex, so far no major mechanical failures seem to have cropped up (like the 2013 water pump thing, and I forget what year but some kind of dry lube in the gearbox 2-3 years earlier?) ... do you think that the approximately €2500 (over eight years) extended warranty cost is worth the gamble against a single Really Big Repair during the first decade of the car's life? (I tend to keep cars for 10+ years and closing in on 200000Km).

 

many thanks,

 

No, I don't think it's worth the cost, unless you have a bad vibe about the car and the warranty would ease your mind.

I have the same dilemma as my warranty runs out in a few days, but I'm betting on my car being okay and am declining the extended warranty option.

I never took out an extended warranty on my Octavia after 3 years either. Car is now nearly 6 years old and has had no issues except a fuel pressure sensor at 36000 miles. Car has now 62000 miles. 

 

I save money in a “car account” for any eventualities outside of my servicing plan, rather than paying for an extended warranty for something that might happen.

Edited 30 July, 20223 yr by threadbear
Poor grammar

Thanks both @EnterName (😆) and @threadbear. I agree with these in principle. Insurance is always a risk/reward gamble. We buy health and home insurance because the costs would not be bearable for most people. Car repairs - even fairly major (like an engine or a transmission) would be bearable for us .. but, still, if we have the feeling (and, especially, if statistics suggest to us) that we're likely to "win" that insurance "gamble", we also don't mind putting the (hopefully, in the end, net-less) money down up front.

The problem, of course, is that it's quite hard to know the answer to "Will a 2020 car likely need a really major repair before 2029" until lots of 2020 cars start approaching 2029 🙂

 

@threadbear which year and model do you have (now at 6 years and 62000 miles)?

 

thanks again

 

 

23 hours ago, JayLibove said:

Thanks both @EnterName (😆) and @threadbear. I agree with these in principle. Insurance is always a risk/reward gamble. We buy health and home insurance because the costs would not be bearable for most people. Car repairs - even fairly major (like an engine or a transmission) would be bearable for us .. but, still, if we have the feeling (and, especially, if statistics suggest to us) that we're likely to "win" that insurance "gamble", we also don't mind putting the (hopefully, in the end, net-less) money down up front.

The problem, of course, is that it's quite hard to know the answer to "Will a 2020 car likely need a really major repair before 2029" until lots of 2020 cars start approaching 2029 🙂

 

@threadbear which year and model do you have (now at 6 years and 62000 miles)?

 

thanks again

 

 

I have an 1.6TDi 110ps manual registered in September 2016. Owned since 11 miles, now getting on for 63000 miles. Has had new discs and pads all round, cambelt/waterpump and on its way to third set of new tyres. 

So, two years on; I did decide to buy the VWFS extended warranty on my Scout starting at the end of its original warranty in October 2022. (The cost is about €28,50/month; the version that I chose extends the bumper-to-bumper warranty out to the end of the 5th year, then drops back somewhat through the end of the 8th year, then for the final two years is major components only; the price stays the same).

It's already paid for itself.

The water pump (of course), an A/C compressor, something that translates (my shop works in Català) as a 'crankshaft flange', the parking brake cable/handle, some kind of engine gasket leak, and a piece of the underbody armor.

All of this by 60000Km.

Hm.