Auto Warranty Buyer's Guide | Extended Auto Warranty Glossary

The consumer guide to uncovering the best value

in auto warranties and repairs.

Auto Warranties

Extended Auto Warranty Glossary of Industry Terms

Ratings: Ratings are independent benchmarks for determining a company’s financial strength. (see A.M. Best & Co. and A Rated.)

Re-insurer: Also known as a Re-insurance Company. An insurance company that issues a policy to guarantee, or re-insure, the obligations of the extended auto warranty provider.

Rental Benefit: The amount you will be reimbursed for actual expenses incurred for substitute transportation while your vehicle is being repaired. Rental benefits are only reimbursed if the breakdown was caused by a covered part or component. Certain exclusions are defined in the extended warranty plan that typically cover benefits if labor exceeds a specific number of hours, or limit reimbursements to a specific dollar amount per day, or for a maximum number of days.

Repair Facility: An authorized licensed auto repair facility as described in your specific extended auto warranty plan. This includes, but is not limited to your dealership, local mechanic, or national repair center.

Roadside Assistance: An additional auto warranty plan benefit that provides 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“ extended auto warranty policy. Stated Component policies list the vehicle’s parts and components that are covered by the extended warranty. If the component or part is not listed then 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. Sometimes a small fee is required.

Travel Interruption Benefits: Reimbursement for lodging and restaurant expenses due to mechanical breakdown of your vehicle during a trip. Travel is typically defined as over 100 miles from your 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. This term does not mean that the vehicle was not purchased “brand new” or you are not first owner, simply that the vehicle’s original manufacturer’s bumper to bumper warranty has expired.

Automotive Resources