QuestionHello,
I’m looking to buy a 2003 BMW Z4 with very low mileage. The warranty is about to expire so I would like to purchase an extended warranty. Should I buy one from BMW or go with an aftermarket company and if so which one? Are there some really good deals out there?
Thanks,
Kevin
AnswerHi Kevin,
Great choice of cars; I was a BMW driver for years, only recently choosing a new Porsche Boxster over the Z4. Initially I was looking at a 2003 Boxster S; considering the cost of repairs of these (and BMW’s) great vehicles, I was also going to add an extended warranty, as you’re considering. But I ended up going to new car route instead.
Buying an extended warranty, just as when buying any new or pre-owned vehicle, takes a little research to know what you’re buying and how much you’re paying for it. I cover this in my book $ave Thousand$ Buying Your Next Car: Confessions of a Former Car Salesman (www.Make-Me-Smarter.com.)
Generally, the auto companies are not in the extended warranty business, preferring to purchase them through 3rd party companies for re-sell (and hefty markups.) These are the same warranty’s you can buy directly on your own. The benefit of getting it from the BMW dealer is that you can pretty much count on the warranty being through a reputable company. The downside is that you can end up paying a lot more for the same coverage, from the same insuring company. Here’s what I would recommend.
1. Get a copy of the coverage provided by the warranty provided through the dealership. Make sure you know the exact cost of the coverage, what’s covered and what’s not, and what your deductible’s are, if any, per visit.
2. Search for automobile extended warranties on the Internet, and look for companies that are “A” rated by A. M. Best & Company, an independent ratings and analysis company. Best is considered “the gold standard in insurance ratings” and will help you to know the reputation of the company you’re considering buying from.
3. Compare both their recommended coverage with that being offered by the dealer, as well as a policy with the exact same coverage.
4. And of course, as with any Internet purchase, at least do some basic research on the insurance company.
Yes, this does take some time and work on your part, but an hour here can end up saving you hundreds of dollars when buying exactly the same product the dealer’s offering you.
Finally, as a rule I do not endorse or recommend specific companies to purchase from. I don’t have experience with most of them, and am not in a position to research them and make recommendations.
I hope this helps you, Kevin. Regardless, I know you’ll love the Z4.
Regards,
Ron
