Countless amounts of South Africans have purchased a motor warranty (often when purchasing a vehicle) only to have their claims rejected upon claiming. Why is that?

Well, the first problem is that many people tend to confuse a motor warranty with a service plan or maintenance policy. What’s the difference?

A motor warranty is specifically designed to cover mechanical breakdowns. It is, essentially, insurance for your car’s most vital components. A warranty doesn’t cover consumables, the cost of computer diagnostics, and does not cover any aspect of the service or maintenance. For that, of course, you need a service plan. 

So, while a motor warranty covers the replacement costs related to mechanical (or even electrical) breakdowns, a service plan covers the cost of a service. This commonly entails the replacement or maintenance of your vehicle’s oil, oil filter, fuel filter, air filter, spark plugs, etc. 

Service plans, then, ensure that your car remains in good working order. Motor warranties are there for when things go terribly, terribly wrong. It’s common knowledge that the older a vehicle gets, the higher the likelihood of a (very expensive) mechanical or electrical breakdown occurring, and this is where motor warranties have proven themselves a saving grace. 

But, of course, many people still struggle with them. A lot of this confusion has to do with the simple misinterpretation of terms and conditions, or a misunderstanding of what a motor warranty is, how it works, and how to use it. 

As the owner of the vehicle, you’re solely responsible for keeping it in good health. Not only will this keep you and your loved ones far, far safer on the roads, but it could also save you from having to foot a massive repair bill one day.

So, you need to ask a couple of very important questions before purchasing a warranty.

Which vehicle parts are covered by this warranty? How long is the warranty valid for? If the vehicle isn’t serviced on time, how long until your warranty is cancelled?

It’s very, very important to know the terms and conditions you’re agreeing to. Understanding the policies you own is just as crucial as understanding your vehicle. 

So, let’s take a look at two very important things you should know about a motor warranty. 

In private sales, warranties are transferrable from owner to owner, which also increases the resale value of the vehicle. If the car you purchased didn’t have a warranty, you’ll need to see to that yourself. When it comes to dealerships, however, whether you’re thinking of purchasing a new or pre-owned car, chances are pretty good that you’ll be offered an additional warranty by the dealership. In this scenario, it’s important to ask a number of questions first.

Does this vehicle have a service book and when was it last serviced?

This is important, firstly because no vehicle salesperson is under any obligation to offer this information (the onus is on you to ask), but also because different warranties (whether it be an extended motor warranty of a pre-owned motor warranty) have different terms and conditions, and these warranties will require that the vehicle be timely serviced at certain intervals (after a certain amount of km or time reached, whichever comes first). 

So, next question: What are the service intervals expected from this warranty?

You may come to find that the pre-owned vehicle you’re about to purchase is actually due for a service, or may have been poorly maintained in the past. If so, ask that the dealer completes a full service before the sale. They’re under no obligation to do this either, but many of them would happily oblige in order to close the sale. Needless to say, until the vehicle is up-to-date on its services, it would be folly to purchase an additional warranty (or even the vehicle itself).

In most (if not all) cases, you’ll find your warranty claim rejected, or the warranty itself cancelled, if the vehicle hasn’t been kept up-to-date on its services. 

One very important thing to keep in mind is that though it’s vital to keep your vehicle’s services up-to-date, you won’t be permitted to do this yourself. Not even an oil change. All services have to be performed by an approved, professional service provider, or your warranty will be rendered invalid.

You also need to remember that certain warranties may not cover the entirety of your claim amount. In some cases the full amount (the cost of the replacement parts, the labour, etc.) will be covered, but in others, the warranty will only assist with part of the amount required. 

Most warranties will also only allow you to claim for one incident, or job, at a time.

Ask the big questions, and be aware of any limitations or specifications. 

All possible restrictions considered, though, the right motor warranty on the right vehicle is still a very wise purchase. As anybody who has ever had to pay these colossal repair or replacement costs out-of-pocket will know, any financial assistance can go a very long way. Not to mention that many warranties also come with numerous free benefits, such as roadside assistance, medical assistance, car rental, and much more. 

When purchasing a vehicle – especially a pre-owned vehicle – it’s pretty much impossible to know what you’re getting, if that vehicle has been properly cared for, and it’s advisable to consider a warranty to cover unforeseen calamities.   

CompareGuru knows what's good. You'll never need another insurance comparison tool again!

Sign up to our newsletter to stay up-to-date on our latest tips on how to get the best out of your insurance, what insurance really means, and how to avoid any pit falls along the way.

CompareGuru has you covered.