A warranty is a form of insurance policy. If a car breaks down due to the mechanical or electrical failure of a covered part, the warranty will cover the costs of replacement parts and labour.




Most new cars come with a 3 year manufacturer warranty. If you buy a used car from a Franchised main dealer it will often come with a Manufacturer-backed warranty. Cars purchased from Independent Dealers and car supermarkets may also include a warranty. And most retailers will offer a warranty as a separate package, if it's not already part of the car purchase. Unfortunately cover levels vary widely and purchasers should be careful to check out excesses, cover levels, claim limits and conditions.

In recent times the major breakdown recovery providers have offered schemes such as Parts & Labour Cover and Breakdown Repair Cover. Unfortunately, these only cover you if you are on a journey at the time of breakdown (or at home, if you have already purchased their expensive home assistance package). Very few warranty claims materialise at the time of a breakdown so payouts are likely to be minimal - beware!

It is not commonly known that you can also buy a PERSONAL (or After Market) WARRANTY independently - whether you are buying a car from a private seller, a dealer, or an auction house. You can even buy cover for your current car - depending on its age and mileage (generally up to 12 years or 120,000 miles). Because these warranties are sold directly to consumers they tend to offer enhanced levels of cover and fewer "get-out" clauses.




A worthwhile warranty will cover major mechanical components: engine, fuel and ignition systems, cooling system, electrical system, gearbox, transmission system, steering, suspension and non-frictional clutch and brake system parts. Other areas to evaluate are as follows:

Wear and Tear. Inferior warranty companies exclude wear and tear from their cover. This means that almost any claim can be rejected on the basis of the age and mileage of the car - "of course it's broken, it's done 60,000 miles." It's difficult to understand how such companies can ever reach any level of trust amongst consumers. Select a warranty company that's upfront about its cover and what happens in respect of wear and tear to insured parts. The best will ask you for a percentage contribution to the parts and labour costs involved, and, the very best will ask you to contribute to the parts cost only. Make sure you know exactly where you stand at the outset and never underestimate the value of such cover. However, no warranty company is a charity for the unscrupulous, so you will probably have to be on cover for a period of time before such claims can be considered. More

Betterment. As a result of a claim a new part will usually be fitted that is better than the old one. You need to know how much you will be expected to contribute toward the cost of the part in such circumstances. Some companies might also make you contribute towards the labour charges. More

Consequential Loss. Another area to be wary of. The best warranties will cover you for claims brought about by a non-insured part failing and subsequently causing damage to an insured part. Make sure that you check any warranty you are considering for this inclusion. More

Oil Leaks. This is often an example of saying that a part is covered but really excluding it - a good example is a shock absorber which usually leaks oil when it fails. Some warranties might say that shock absorbers are covered, but then exclude external oil leaks.




In the main, most warranties exclude normal wear and tear to wheels, tyres, exhausts, catalytic converter, clutch and brakes. Damage to bodywork, paintwork, glass or headlights is also excluded.

Some electronic or electrical items such as audio equipment and car phones are excluded although some warranties cover the air-conditioning system.

The period of cover is usually twelve months with optional extensions offered for up to three years. Older cars, or cars with high mileage, may be offered warranty cover for shorter periods only, while some sports or high performance vehicles may need to go through specialist suppliers, as general policies would not be suitable for them.




European imports generally come with the manufacturer first year warranty only, however this can be extended with a personal warranty.




After Market warranty schemes protect both new and used cars. Certain policies offer cover equivalent to the manufacturer schemes and a few cover you against failure caused by wear and tear to covered items - a major benefit.




Most warranties are only valid if an approved dealer has serviced the car to the manufacturer's schedule. To find out the manufacturer's recommended intervals contact your local franchised dealer.

‘Servicing tolerances’ are often between 500 and 1000 miles over the scheduled mileage or 30 days over the scheduled date. Service records are needed to maintain warranty terms and in the event of a claim the original paperwork will need to be produced.

The validity and extent of the cover can be affected by usage (some exclude driving school vehicles and mini cabs) and the fitting of non-standard parts.

Other exclusions include misuse, neglect, and faults subject to recall. Pre-existing mechanical or electrical faults are also excluded – so there is no point signing up for a warranty if you suspect your car is on its last legs.




Make sure you can choose where to take your car to be serviced or repaired. With a newer car that is under its original warranty, you will most likely want to take it to a main dealer, however with an older car you might prefer to use an independent garage which may have a much lower hourly labour rate.




The total of all claims is usually limited to the value of the car or a specific limit for each item. Many dealer warranties will only cover you up to £250 per claim, which is not really enough protection for your car. We have even discovered warranties where claims are limited to a maximum of £150 - you should beware such limits and the companies that sell such policies.

A £5,000 claim limit should be adequate in almost all circumstances, even for nearly new vehicles. Only consider cover for less if your car is worth less. Always check limits for individual claims and the total claim limit in any one year.




Breakdown Recovery. Most warranties include a form of breakdown recovery cover, but it will be up to you to organise the recovery and subsequently reclaim. However, cover will generally be limited to a maximum contribution and this will only be reimbursed for recovery costs if the breakdown was the result of an insured part failing. Check out the maximum contribution limits that apply. In such circumstances contributions to car hire, emergency travel, vehicle collection and sometimes hotel accommodation may also be covered. Double-check that these are actually part of the package or if they are optional extras.

Most warranty companies will also be able to provide breakdown recovery membership and it can be very cost effective if you purchase this at the time of your warranty purchase if you do not already have breakdown cover elsewhere.

Some warranty companies offer you access to significant savings on other motoring and leisure products that can represent real value.




Check the conditions affecting transfer of the policy and the administration charges involved - usually £25 - £50. Beware, as not all warranties are transferable.

Check out if any limits apply to the hourly garage labour rate that the warranty company will pay for repairs.

Find out if there is 'wear and tear' and 'consequential loss' cover, also study any 'betterment' clause carefully.

See our Car Warranty Checklist and Car Warranty Scorecard




The Association of British Insurer’s (ABI) lay down guidelines on how to sell warranties. Ensure that whoever you buy your warranty from is an intermediary and that they abide by the ABI code and are regulated by the Financial Services Authority (FSA).