Extended warranty advice

[John VonJeep]

It’s true that people do occasionally manage to milk the hell out of these things:

https://jalopnik.com/my-range-rover-s-carmax-warranty-is-now-half-over-and-i-1733772237

But that just tends to lead to further tightening of the underwriting guidelines. As others have noted, they don’t sell them to lose money.

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[GATORB8]

It’s true that people do occasionally manage to milk the hell out of these things:

https://jalopnik.com/my-range-rover-s-carmax-warranty-is-now-half-over-and-i-1733772237

But that just tends to lead to further tightening of the underwriting guidelines. As others have noted, they don’t sell them to lose money.

That set of articles made Demuro's career.

 

[hemiblas]

https://www.jlwranglerforums.com/fo...arranty-help-you-beat-inflation.130724/unread

You can't beat this deal. If you get one, mopar only, no 3rd party. I got it on my Bronco. My jeeps are getting modified so I'm not going to get it on those, but I do worry about the engine, tranny and turbo...

 

[John VonJeep]

That set of articles made Demuro's career.

I remember laughing so hard the first time I read them.

 

[GATORB8]

I remember laughing so hard the first time I read them.

When Jalopnik lost that group of writers, it went downhill. Several of them were entertaining back then, although I lost interest after they all went to YT.

 

[TheRaven]

But that said Kevin's comments are provable wrong and its not anyone's opinion.

What do you mean they don't work that way? Are they in the business of losing money? The only way they make money is to sell more coverage than they end up paying out for. On a case by case basis, obviously there are those who end up with a $10k engine replacement free with there $3-5k extended warranty. Those are paid for by the people who never have anything covered and those who have dumb little things like broken visors covered. I'm not arguing for or against the extended warranty, that's an individual decision. The fact remains these companies all show net profits proving that they sell more policies than the value of their covered repairs period.

Warranty companies sell a warranty. That's all they do...they sell the product, take a commission, then pass it on to an insurance fund. They couldn't care less if the warranty is a money maker or loser - not their problem. The fund cares...but it's got hundreds of millions of dollars of policies in it that range from Jeep Wrangler warranties to life insurance and homeowners policies. Losses from a few thousand JL warranties won't even move the needle.

 

[Zandcwhite]

Warranty companies sell a warranty. That's all they do...they sell the product, take a commission, then pass it on to an insurance fund. They couldn't care less if the warranty is a money maker or loser - not their problem. The fund cares...but it's got hundreds of millions of dollars of policies in it that range from Jeep Wrangler warranties to life insurance and homeowners policies. Losses from a few thousand JL warranties won't even move the needle.

So you're convinced there are companies perfectly fine operating at a loss when it comes to Jeep warranties because they make their money in Healthcare? That's not how business works. If that division was a loser they'd drop it or raise prices to match cost plus profits period.

 

[John VonJeep]

When Jalopnik lost that group of writers, it went downhill. Several of them were entertaining back then, although I lost interest after they all went to YT.

Yes. And, of course, Autoblog was recently completely disbanded after 20 years. Fired all their writers and seems to have all-AI content now. Very sad.

 

[Bobby Hank]

I see that point, I’m really just trying to see if there is any benefit. The Reign was paid off in 10 months so any maintenance costs would be just that. I suppose another option would be open a savings account with the cost of the warranty and add some funds to it monthly in the event higher end item events occur.

I was going to suggest just this.

 

[TheRaven]

So you're convinced there are companies perfectly fine operating at a loss when it comes to Jeep warranties because they make their money in Healthcare? That's not how business works. If that division was a loser they'd drop it or raise prices to match cost plus profits period.

There are no "divisions", all these products are thrown together in these funds. They do move them around from time to time, but at the fund level, all they are is "liabilities". They don't know or care if they're Wrangler warranties, Rover warranties, Honda warranties...they all end up in there together.

Use logic Zach...how can I buy a 8/120 B2B warranty for a Jeep Wrangler for $1200? We both know that it's going to be very rare to see a JL make it to 120k miles without needing significantly more than that put into it. If they were still doing warranties the old school way, MaxCare prices would be stratospheric.

 

[Zandcwhite]

There are no "divisions", all these products are thrown together in these funds. They do move them around from time to time, but at the fund level, all they are is "liabilities". They don't know or care if they're Wrangler warranties, Rover warranties, Honda warranties...they all end up in there together.

Use logic Zach...how can I buy a 8/120 B2B warranty for a Jeep Wrangler for $1200? We both know that it's going to be very rare to see a JL make it to 120k miles without needing significantly more than that put into it. If they were still doing warranties the old school way, MaxCare prices would be stratospheric.

We already had 1 JL go to 63k miles without a single issue before it was stolen. I have no doubt that had I bought an extended warranty they would have made money on me. Now we are at 35k miles on the 2022 and 24k miles on my JTM, again not a single warranty claim. You're kidding yourself if you think warranty work is guaranteed. You're delusional if you think the companies don't know exactly what profit margins come from which products they sell. That's basic business and it's automated in every modern accounting software.

 

[autotragic]

We already had 1 JL go to 63k miles without a single issue before it was stolen. I have no doubt that had I bought an extended warranty they would have made money on me. Now we are at 35k miles on the 2022 and 24k miles on my JTM, again not a single warranty claim. You're kidding yourself if you think warranty work is guaranteed. You're delusional if you think the companies don't know exactly what profit margins come from which products they sell. That's basic business and it's automated in every modern accounting software.

Just who cares...really? Why do you give 2 shits and keep arguing? Personally if you want to own a JL without additional warranty coverage...good for you? /golfclap

 

[TheRaven]

We already had 1 JL go to 63k miles without a single issue before it was stolen. I have no doubt that had I bought an extended warranty they would have made money on me. Now we are at 35k miles on the 2022 and 24k miles on my JTM, again not a single warranty claim. You're kidding yourself if you think warranty work is guaranteed. You're delusional if you think the companies don't know exactly what profit margins come from which products they sell. That's basic business and it's automated in every modern accounting software.

Yeah man chill...it's great that you got to 63k miles but really, that's nothing. That's barely out of basic powertrain coverage. Upwards of 80k is where the fun begins.

Also, I never said "warranty work is guaranteed". That's whole different subject, and an important one at that. And also, you need to stop applying "business" rules to insurance products. It's a whole different ballgame. There are so many layers you'd never be able to follow...and that's not a knock on you...that's for anyone not in the business, including me. I just have a good friend who IS in the business and tried to explain it to me.

 

[Zandcwhite]

Yeah man chill...it's great that you got to 63k miles but really, that's nothing. That's barely out of basic powertrain coverage. Upwards of 80k is where the fun begins.

Also, I never said "warranty work is guaranteed". That's whole different subject, and an important one at that. And also, you need to stop applying "business" rules to insurance products. It's a whole different ballgame. There are so many layers you'd never be able to follow...and that's not a knock on you...that's for anyone not in the business, including me. I just have a good friend who IS in the business and tried to explain it to me.

They still know profits and losses. That's just basic business. The basic powertrain is 36k, we were nearly double that. Most of the extended warranties being compared in this thread are 80k and we were close to that. Again, in the case that you needed major repairs you'd save money, but in reality odds are you simply won't.

 

[Zandcwhite]

Just who cares...really? Why do you give 2 shits and keep arguing? Personally if you want to own a JL without additional warranty coverage...good for you? /golfclap

If you see the value of buying an extended warranty, buy 1? Do you feel guilty or ashamed if someone points out they are in the business of making money and aren't covering more than they take in period? Maybe your extended coverage will pay for itself, odds are better that it won't. It's simple business. Sorry if that hurts your feelings.

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