Car warranty insurance is a protection policy that covers the cost of your car’s wear and tear for a set period of time. It’s a guarantee that the car has been sold to you in good condition and if not, the warranty provider will pay out to cover the repair costs. Under warranty insurance, you will be covered for parts and labour costs relating to the general mechanics of your car.

If you buy a new car, it will come with a car warranty for a set period of time, usually between three and seven years. Once this comes to an end, you can get an aftermarket warranty as an extended warranty.

You can take out an extended warranty from the car manufacturer if you are buying a new car, or from another provider if you are buying a used car.

How to find the best car warranty insurance

To find the best used car warranty insurance, you should shop around to find one which works for your needs.

You should explore the labour rate, which is the maximum amount the warranty provider will pay towards a garage’s labour costs. It’s helpful to also look into the age or mileage limit. If there is a limit, it means the provider won’t pay for repairs if your car is above that.

If you are taking out an extended car warranty, you should think about the type of car you have and what kind of maintenance it needs, as well as how often you use it. For a used car warranty, it would be worth looking at extended car warranty cover for wear and tear too, as not all warranty providers will offer this.

The price you pay for your policy is always going to be an important factor, but you should also read through the providers’ policies to make sure they cover what you need.

What is included with warranty insurance?

Depending on the level of cover you have, car warranty insurance usually includes repairs to your:

  • Engine and suspension

  • Clutch and brakes

  • Transmission system

  • Fuel and ignition system

  • Air conditioning

  • Electrics

  • Gearbox

  • Steering

Check the claims limit, as this is the most an insurer will pay if you make a claim. Check exactly what is covered here.

Lots of warranty insurance policies also include extra features, like breakdown recovery or hire car cover while yours is being repaired.

What’s not covered?

All car warranties list parts that are covered, but they vary depending on your policy. The main exclusions for most car warranty policies are:

  • Batteries, wheels, tyres, exhausts, catalytic converters, worn out clutches and brakes

  • Damage caused by oil leaks

  • Cars used for competitions, commercial deliveries or as taxis

  • Damage caused by frost, blockages, contamination or sludge

  • Poor workmanship or faulty components

Check the Insurance Product Information Document (IPID), a simple two-page document that provides clear information about all levels of cover, restrictions and exclusions. Always refer to policy terms for full details on all your policy benefits and limitations.

Types of warranty insurance

There are lots of different types of warranty insurance available, depending on your needs:

Do you need warranty insurance?

Whether your new car warranty is ending or you are looking for a used car warranty, you can save money and potential worry with warranty insurance.

If the part you need fixing isn’t covered, warranty insurance could be an unnecessary investment so you should always check what is covered in your policy.