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Comments from ITInews readers on motor vehicle extended warranties

Consumers are clearly not happy with the way these products are sold and serviced.

A victim of vehicle warranty

I have been left grasping thin air at the articles contained below. To say the least, I have been a victim of vehicle warranty and had my claim repudiated by SA Warranties, the tale of which follows:

In 2003, I purchased a used VW Golf from LindsaySaker Fourways – because the car was not a ‘MasterCar’, I was nudged to buy a warranty. Two months and 7000km later, I contacted the SA Warranties Administrators after jumping some hoops at the dealer.

My reason was that my car’s gears were not moving anymore – I was then advised that my clutch was finished. As you stated in the article, "Secondly, why should an inspection fee be necessary if the dealer is comfortable selling the motor vehicle in the first place? Surely an inspection and service is already part of the cost of sale of the vehicle?"

I felt that the dealer had the responsibility to assist in the repairs of this type of damage which was not due to normal wear-and-tear.  But, as it would stand, a call center agent at SAWarranties asked the question, "Is there oil deposits where the car is usually parked?"

The answer was yes, but they were old residues from the previous property owner’s vehicle.  I had only been living there for 5 months. From this point, I spent the subsequent weeks fighting with SA Warranties to no end.

I do wish that some action could be taken by the Ombudsman or at least these schemes be exposed for what they are.

Thank you for the most informative and consumer rights asserting newletter – I wish more readers, industry players and consumers are like to be conscientized to these occurances.

Boikanyo Boikanyo

Purchase a vehicle with the manufacturers own extended warranty

I purchased my dream car and an extended warranty policy to kick-in when the manufacturer's warranty expired. I did this to pay for things that may go wrong and be beyond my cash flow at the time.
 
2 things happened after the manufacturer's warranty expired.
1. The service agent failed to establish why the oxygen sensors failed 3 times in 6 months.
2. when I had this investigated by a non franchise workshop it was established that the Turbo system had failed.

Ah! An extended warranty claim.
 
Well to cut the story down to the basics the extended warranty insurer stated that the Turbos suffered 'wear and tear' and they would assist up to a third. R +- 7 500 was paid by them. When I complained they ducked and dived and said that I could go to the Ombudsman but that they would defend.

I decided to go straight to the Insurer who defended the extended warranty company. This was after I asked what moving part of a machine did not suffer wear and tear to which I am still waiting for a reasonable reply.
 
The moral of this story is to purchase a vehicle with the manufacturers own extended warranty, not underwritten by a third party, and make sure that you sell the vehicle before their warranty expires. The car I purchased was the top of the range Swedish car which cost me R 80 000 in repairs (not servicing) after the original warranty expired, all in 10 months.
 
I now have a top of the range French car with an extended warranty provided by the French Manufacturer and so far (1 year afterwards) am happy to say that I sleep happily at night. Yes, I will probably sell this car before the warranty expires.

Graham Wood

This is clearly a rip-off

If you delve deeper, you will find that where the manufacturer of a new car provides their own guarantee and sells the client an "extended warranty" policy a problem could arise if the vehicle is a total loss or is stolen before the extended warranty cover even starts (ie before the insurer is exposed to any risk).

There is a "nasty" cancellation clause that says the underwriters will only refund a premium less the admin fee which, from a very personal experience with Regent, is about 50% of the full premium paid.

The Warranty policy I purchased was arranged by Hyundai West Rand and the car I bought was written off at 35000km, with 25000km or 24 months of the full maintenance contract still to go. Regent refunded me only 50% of the premium paid!

This is clearly a rip-off.

ITInews reader