Using the Better Business Bureau
to Purchase Your Vehicle Service Contract
A vehicle service contract is a great
way to cover service repairs and maintenance costs that inevitably come with ownership. It not only allows you to protect your investment and increase your car's value, it provides you with a
reliable way to make payments that fit within your budget so that you can avoid having any large or unexpected bills.
But do you know what you're getting with
your vehicle service contract? Does it meet your exact needs and match your particular driving habits? And, most importantly, who is the provider? The Better Business Bureau has compiled a list
of helpful questions for you to consider before purchasing your vehicle service contract:
Who backs the service
contract? It may be the manufacturer, dealer, or an independent company.
Many service contracts sold by dealers are handled by independent companies called administrators. Administrators act as claims adjusters, authorizing the payment of claims to any dealers
under the contract.
What's the cost of
the auto service contract? Usually, the price of the service contract is based on the car
make, model, condition (new or used), depth of coverage and length of contract. The cost of the service contract can range from several hundred dollars to more than $2,000. In addition, you
may need to pay a deductible each time your car is serviced or repaired.
What is covered and
not covered? Few vehicle service contracts cover all repairs. Watch out for
absolute exclusions that deny coverage for any reasons. For instance, if the contract specifies that only "mechanical breakdowns" will be covered, problems caused by "normal wear and tear"
may be excluded.
How are claims
handled? When your car needs to be repaired or serviced, some service
contracts permit you to choose among several service dealers or authorized repair centers. Others require the car owner to return the vehicle to the selling dealer for service. Find out if
you will need prior authorization from the contract provider for any repair work or towing services. Ask how long it will take to obtain authorization and whether you can get authorization
outside of normal business hours.
What are your
responsibilities? Under the
contract, you may have to follow all the manufacturer's recommendations for routine maintenance, such as oil and spark plug changes. Failure to do so could void the contract. To prove you
have maintained the car properly, keep detailed records, including receipts. Find out if the contract prohibits you from taking the car to an independent station for routine maintenance or
performing the work yourself. The contract may specify that the selling dealer is the only authorized facility for servicing the car.
What is the length of
the service contract? If the service contract lasts longer than you expect to own
the car, find out if it can be transferred when you sell the car, whether there's a fee, or if a shorter contract is available.
Make sure that you read and thoroughly
understand the agreement before you sign, and check to see that all verbal promises have been included. It is also a good idea to contact the Better Business Bureau for a reliability report on
the business offering you the contract. A quick visit to the BBB website can tell you instantly whether or not a business meets their Accreditation Standards for integrity, honesty, transparency
and responsiveness. http://www.bbb.org/us/Find-Business-Reviews/
Filed Under: Better, Bureau, Business, contract, service, Vehicle