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Authorization: The official approval issued by the extended warranty administrator before repairs can be started.
Auto Warranty: A policy that covers a vehicle against mechanical failures and breakdowns. Also known as a Vehicle Service Contract, Extended Warranty or Mechanical Breakdown Insurance.
Bumper to Bumper: Technically an “exclusionary” coverage policy. This is the most comprehensive extended auto warranty available. It covers so many parts and components the policy will only list the items that are not covered under the warranty.
Cancellation: A cancellation clause allows the extended auto warranty holder to cancel the policy and in most cases receive a refund. Most extended auto warranties have a 30 day full refund cancellation clause, providing no claims have been filed. Typically, cancellation refunds are pro-rated based on the length of time and mileage driven while the policy was in force.
Corrosion Warranty: A corrosion warranty is a vehicle manufacturer’s warranty that covers rust and perforation on the metal body of the vehicle. These can also be purchased as an aftermarket policy. Some anti-corrosion products include a product warranty or guarantee that protects against rust.
Deductible: The amount stated in your extended auto warranty policy that you must pay the repair facility for each covered repair done to your vehicle. The warranty company pays the balance of the covered repair. Typical deductibles range from $0 to $500.
Diagnostics: The process a repair facility performs in order to determine the cause of a part failure and required repairs.
Eligibility: The amount of extended warranty coverage a particular vehicle qualifies for based on specific characteristics and usage. Eligibility is typically based on age, mileage, make and model of the vehicle including vehicle components such as four-wheel-drive, turbo or superchargers, number of cylinders. History and usage are also taken into consideration, for example a salvaged title or the commercial use of the vehicle. Each extended auto warranty plan has its own specific set of eligibility requirements. Some extended warranty plans offer riders, or surcharges for certain components.
Exclusionary Policy: Also known as a Bumper to Bumper warranty. This is the most comprehensive extended auto warranty available. It covers so many parts and components of a vehicle that the policy will only list the items that are not covered under the warranty.
Extended Auto Warranty: The generally accepted term to describe Vehicle Service Contract. An extended auto warranty will pay for a vehicle's covered repairs based on the terms of the warranty.
In-Service Date: The date the vehicle was purchased by the original owner. This could also be the date the vehicle was first placed in use for rental, demonstration, or other purposes by the dealership.
Inclusionary Policy: Also known as a Stated Component extended warranty policy. Inclusionary policies list all of the vehicle’s parts and components that are covered by the warranty. If the component or part is not listed then it is not covered.
Inspection: The examination of your vehicle's components by a certified mechanic. An inspection is when a certified mechanic attests to the proper working condition of all components of your vehicle. Pre-warranty inspections are required by some companies before an extended warranty will be put on a vehicle.
Insurer: The insurance company that issues a policy and guarantees the obligations and performance of the extended warranty company. All reputable auto warranty companies are insured by a third party independent insurance company who guarantees payment of policy claim should the original auto warranty company default on the policy.
Make: The make is the company who manufactured the vehicle.
Manufacturer: The manufacturer is the company who built the vehicle.
Manufacturer's Recommended Maintenance Guidelines: These are the vehicle’s manufacturer’s guidelines for routine maintenance to keep a vehicle in safe and optimal operating condition. Typical maintenance guidelines would include how often to change the engine oil, checking proper fluid levels, performing tire rotations, and replacement of certain parts at specific intervals. Not following the manufacturer’s recommended maintenance schedule may void your warranty agreement.
Manufacturer's Warranty: This is the vehicle manufacturers stated warranty to repair a vehicle for a specified period of time and/or mileage. Manufacturer’s warranties are not all-inclusive and cover only specific components of a vehicle.
Model: The model is the specific type of vehicle that was made by a particular manufacturer.
New Vehicle: As applied to extended auto warranties, the term new vehicle generally refers to a vehicle that is still covered by the original manufacturer's bumper to bumper warranty or is under 5 years old and under 50,000 miles. This term does not mean that the vehicle was just purchased from the dealership. It’s simply that the vehicle is within a certain age and mileage.
Odometer Miles: The actual miles the vehicle has traveled as displayed on the vehicle’s odometer. Failure of the odometer or removal will void an auto warranty agreement unless the replacement of the new functioning odometer has been certified by the repair facility and documented to the warranty company.
Plan Expiration: This is the date or odometer mileage when an extended auto warranty policy expires. For example, a 3 year / 75,000 mile extended warranty will expire 3 years from the date it was purchase or when the odometer reads 75,000 miles, whichever comes first.
Plan Mileage: The total mileage an extended auto warranty will cover a vehicle until the policy expires. This can be when a vehicle reaches a certain mileage on the odometer or a specific number of miles from the mileage on the vehicle at the time the warranty was purchased.
Plan Term: The amount of time in years or months and/or the total mileage that an extended warranty will cover a vehicle.
Powertrain Coverage: Also known as drivetrain. This is a specific type of extended warranty policy which covers a vehicle’s engine, transmission, and drive axles.
Rental Benefit: The amount that will be reimbursed for actual expenses incurred for substitute transportation while a vehicle is being repaired. Rental benefits are only reimbursed if the breakdown was caused by a covered part or component.
Repair Facility: An repair facility who is authorized by the warranty provider to privide repair services under the warranty. This includes, but is not limited, to a dealership, local mechanic, or national repair center.
Roadside Assistance: An additional benefit that provides for roadside assistance such as towing, battery jump, flat tire repair, fuel and fluid delivery, or help for an emergency lock out. These benefits will include a toll free telephone number to call for service 24 hours a day 365 days a year.
Stated Component Coverage: Also known as an Inclusionary coverage. Generally, a stated component policy will cover the engine, transmission drive axles and most other major mechanical and electrical systems in a vehicle. Stated Component policies will list the parts and components that are covered by the warranty. If the part or component is not listed in the policy it is not covered.
Transfer: A vehicle with a transferable extended auto warranty can have the warranty transferred to the new owner if the vehicle is sold privately. Generally a small fee is required. A warranty can only be transferred to a private owner and not to a dealership.
Travel Interruption Benefits: Reimbursement for lodging and restaurant expenses due to mechanical breakdown of a vehicle during a trip. A trip is typically defined as over 100 miles from home.
Used Vehicle: As applied to extended auto warranties, the term used vehicle means a vehicle whose original manufacturer's bumper to bumper warranty has expired or the vehicle is older than 5 years or has more than 50,000 miles.
Vehicle Identification Number (VIN): Each vehicle has a unique Vehicle Identification Number established by the manufacturer that codes the vehicle’s individual characteristics at the time of manufacture. The VIN number can be found in several places, the most common being:
1. The vehicle title
2. The vehicle registration
3. The vehicle insurance card
4. A plaque on the driver-side dashboard of the vehicle