Is the Chrysler extended warranty coverage worth it?
I haven't looked at that warranty in detail, but generally speaking this should help. What is GAP insurance? In the case of a total loss/write off gap insurance covers the outstanding finance after your regular insurance pay out. The two won't match up usually because of the depreciation right after you buy the car. For example, if you take out $20,000 finance and buy a car, then write it off after six months, your insurance company may only value it at $16,000 but it's unlikely you will have cleared $4,000 from your finance. Gap insurance will pay out the difference and settle the debt. Will Chrysler change the engine, if it comes to bhore? Yes, unless they identify misuse or deliberate damage. For instance, if you do 1000 miles and the engine explodes, it's a mechanical fault that the warranty would cover. If they open up the engine/look at diagnostics and find it's been thrashed to within an inch of it's life, they may claim it was your driving which has destroyed the engine and you would have to prove it was an underlying fault and would have blown either way. Will car dents be covered with this bumper to bumper insurance? Not likely, as I mentioned in the last point, if it's your fault it wouldn't be covered. I think you may be confusing the terms insurance and warranty at this point. Insurance would cover your dents but a warranty only covers the manufacturer's faults, even in the case of extended warranties. What does basic mean in terms of warranty? Sounds obvious, but whatever Chrysler want it to mean! There's no legal definition of 'basic' so you would need to check the documents thoroughly or ask them to explain exactly what is and isn't covered. If they're reluctant, it's probably because 'basic' covers very little...
I have coworker who reported that he leased a Nissan Leaf from 2013-2016 and was offered $4000 off the contracted purchase price at the end of the lease due to a glut of other lessees turning in for a lease on the newest model with greater range.  It's not clear that this experience will be repeated by others three years from now, but there is enough uncertainty in the future electric car market that it's quite possible to have faster depreciation on a new vehicle than you might otherwise expect based on experience with conventional internal combustion powered vehicles. Leasing will remove that uncertainty. Purchasing a lease-return can also offer great value. I looked at the price for a lease return + a new battery with the extended range, and it was still significantly cheaper than buying a completely new vehicle. "My knee-jerk reaction was ""no, they are not worth it"", but I took a little time to look up what some of the trusted names in consumer electronics reviews had to say about extended warranties/service contracts. A cnet writer said that your decision should consider the price of the service contract relative to the price of the item you're buying, as well as the amount of hassle you're willing to endure, should something go wrong. Consumer Reports believes that the warranties that come with your products are almost always enough, and they say that electronics and appliances are so well-built nowadays, the likelihood of you needing extra service before you upgrade are slim-to-none. And the folks over at epinions.com offer the same maybe-yes-maybe-no advice as the cnet guys: depends on your appetite for risk and the options available to you. So I would suggest that the answer be ""no"" most of the time, but consider it anyway." "The general answer to any ""is it worth it"" insurance question is ""no,"" because the insurance company is making a profit on the insurance.* To decide if you want the insurance, you need to figure out how much you can afford to pay if something happens, how much they cover, and how badly you want to transfer your risk to them.  If you won't have trouble coming up with the $4000 deductible should you need to, then don't get this extra insurance.  * I did not mean to imply that insurance is always a bad idea or that insurance companies are cheating their customers. Please let me explain further.  When you buy any product from a business, that business is making a profit. And there is nothing wrong with that at all. They are providing a service and should be compensated for their efforts.  Insurance companies also provide a service, but unlike other types of businesses, their product is monetary. You pay them money now, and they might pay you money later. If they pay you more money then you spent, you came out ahead, and if you spend more money then they give you, it was a loss for you.  In order for the insurance company to make a profit, they need to bring in more money than they pay out. In fact, they need to bring in a lot more money then they pay out, because in addition to their profit, they have all the overhead of running a business.  As a result, on average, you will come out behind when you purchase insurance. This means that when you are on the fence about whether or not to purchase any insurance product, the default choice should be ""no.""  On average, you are financially better off without insurance.  Now, that doesn't mean you should never buy insurance. As mentioned by commenter @xiaomy, insurance companies spread risk across all of their customers. If I am in a situation where I have a risk of financial ruin in a certain circumstance, I can eliminate that risk by purchasing insurance. For example, I have term life insurance, because if I were to pass away, it would be financially catastrophic for my family. (I'm hoping that the insurance company makes 100% profit on that deal!) I also continue to buy expensive health insurance because an unexpected medical event would be financially devastating. However, I always decline the extended warranty when I buy a $300 appliance, because I don't have any trouble coming up with another $300 in the unlikely event that it breaks, and I would rather keep the money than contribute to the profits of an insurance company unnecessarily.  In my original answer above, I pointed out how you would determine whether or not to purchase this particular insurance product. This product pays out a bunch of relatively small amounts for certain events, up to a limit of $4000. Would this $4000 be hard for you to come up with if you needed to? If so, get the insurance. But if you are like me and have an emergency fund in place to handle things like this, then you are financially better off declining this policy." I know, right? What a joke. If they were a real car company, they would never acknowledge a problem and put in a repair and warrantee program that benefits the customer. When will Tesla learn to cover-up problems, and then do calculations to see if the legal costs they will pay due to the problem are more than the cost of fixing the problem? What a joke of a company. I've put 75K miles on my 2013 Volt and it's holding up great.  Solid car.  I've got a pre-reveal Model 3 reservation, and I'm reluctant to trade the Volt in.  Looks like I'll have to make that decision pretty soon. The first 10-30k may have some issues. Nissan had frame / battery problems with the first 30k Leaf's.This is the reason that the first 10k T3 will be going to employees. Second 10k to loyal Model S / X owners and third 10k to buyers in CA near the factory.  I have a friend that had one of the first Model X,  it took almost a year to work out all of the issues, but everything is working now and they are happy! Consumers got what they paid for and Tesla put better equipment than necessary inside to A. Assist with resale value and B. Lessen manufacturing costs. The side effect is longer battery life and the option to upgrade without needing service. It's kind of a win win win win. "Ditto other answers, but I'd add there's a lot of psychology going on in a sale. If you're paying cash, you presumably have a pretty fixed upper limit on what you can spend. But if you're getting a loan, a large increase in the price of the car may sound like just a small addition to the monthly payment. Also, these days dealers often try to roll ""extended warranties"" into the loan payment. Most people can't calculate loan amortizations in their heads -- I'm pretty good at math, and I need a calculator to work it out, assuming I remember or wrote down the formula -- a dealer can often stick a piece of paper in front of you saying ""Loan payment: $X per month"" with fine print that says that includes $50 for the extended warranty, and most people would just say, ""oh, okay""." "The good news about maintenance is that there's much less scheduled maintenance because the cars are mechanically much simpler. See the official service schedule. Most of it is just ""rotate tires / replace cabin air filter"". The brake and suspension systems are very similar to those of a normal car and require comparable maintenance. The bad news is the battery will decay over time and is a major component of the cost of the car. From that link: In the UK, the LEAF’s standard battery capacity loss warranty is for   60,000 miles or five years So you should factor your warrantied battery lifetime into the depreciation calculation. I don't think there are going to be many ten- or twenty- year old electric cars from the current crop in 2030 or 2040 as they're still improving dramatically year-on-year. (Slightly too long for a comment, slightly too short for a proper answer)" One thing to consider: the Apple service plan covers replacement of the battery in addition to the normal things you expect.  Since the battey is not consumer replaceable, and, according to what I hear, is almost certain to wear out within the two year life of the phone, and is more expensive to have Apple replace than the extended coverage, it's probably worth it.  (Disclaimer: this was told to me by my son who used an iPhone for two years before I got mine.  I haven't independently verifies his facts. This also applied to the 3G and 3GS. I'm just assuming it's also true for the 4.) I suspect this is done at least in part in response to [this review by Edmunds](http://www.edmunds.com/tesla/model-s/2013/long-term-road-test/wrap-up.html) and a [similar one by Consumer Reports](http://www.consumerreports.org/cro/news/2014/08/consumer-reports-tesla-model-s-has-more-than-its-share-of-problems/index.htm) where they describe the number of problems Tesla had over 1 year of ownership.  Esp in the Edmunds review, if you scroll down part way down the article, you'll see the number of powertrain part replacements that were done; it's quite substantial. "In general, if you can afford to replace something, you are able to ""self-insure"".  You really want to understand a little of the statistics before you can make a generic call, but my rule of thumb is that insurance via ""extended warranty"" is rarely a good deal.  Here is a simple expected value math formula you can apply (when the > is true, then you should buy it): replacement cost x likelihood of using warranty % > cost of insurance You can then back-compute, what is the likelihood that I'd need to lose this item to break even?  Given your numbers: $2000 x Y > $350 or Y > (350/2000) or Y > 17.5% So if you think there is a 17.5% or greater chance that you'll need to have you system replaced (i.e. not just a simple fix) AND (as Scott pointed out) you'll be able to actually use the replacement warranty then the applecare is a good purchase.  Note, this only applies to items you can replace out-of-pocket without significant burden, because if you didn't have the $10k to replace your car, it wouldn't matter if the insurance wasn't such a good deal (especially if you need the car to get to work, etc.) So the obvious question is: ""Why would a for-profit company ever offer insurance on something they are statistically likely to lose money on?""  The obvious answer is ""they wouldn't,"" but that doesn't mean you should never buy this type of insurance, because you may have statistically significant circumstances. For instance, I purchased a $40 remote helicopter as a gift for my children.  I also paid the $5 for a ""no questions asked"" warranty on it because, knowing my kids, I knew there was a nearly 100% chance they would break it at least once.  In this case, this warranty was well worth the $5, because they did break it!  Presumably they make money on these warranties because most of the purchasers of the plan are more attentive (or too lazy to make the claim) than in this case. Edit note: I incorporated Scott's comment about likelihood of being able to utilize the warranty into a combined ""likelihood of using warranty"" term.  This term could be broken up into likelihood of needing replacement x likelihood of actually getting company to replace it I didn't do this above because it makes it a little harder to understand, and may not be a major factor in all cases, but you can definitely add it after the fact (i.e. if there's only a 90% chance Applecare will pay out at all, then divide the 17.5% by 0.9 to get 19.4% likelihood of needing the replacement for it to be cost effective). More complete formulas can be derived also (including terms for full replacement costs vs repair costs and including terms for ""deductible"" type costs or shipping), but I'm trying to keep things relatively simple for those who aren't statistics nerds like I am." "&gt; I am confused how you spin an ""infinite mileage warranty"" into something negative  It will increase their costs in a business model which, until recently, lost money on every unit.  It's good news for buyers in the short term. If Tesla goes out of business, however, the infinite-mileage warranty won't make any difference.  And, in the larger picture, if they're out of business, their awesome customer-focused model doesn't really benefit their customers in any way." "Short answer: Absolutely not, unless you're comfortable with putting years of your labor into a depreciating asset that will incur hefty maintenance costs over its remaining life. i.e. consider your 10K gone forever once you buy the car, and then some. Some comments on your reasons: ""Keeping up with spoiled brats"" is a losing proposition, and is a mindset counterproductive to financial independence. I'd encourage you to find a way to not care about how the spoiled brats live their lives. It won't be easier when you're older and you see your peers driving fancy cars and living fantasy lifestyles that you are tempted to emulate. Break the impulse to ""keep up"" and you'll be in a much better place. A used BMW may not be a piece of junk at first, but once you hit 100K miles, everything will suddenly fall apart and need repair. Been there myself. Still have the car after 7 years, only because very few people want to buy a high-mileage German sport sedan with recurring maintenance issues. See #2. It will be a good drive for a while, then it will own you. This is not so bad when you have a decent amount of savings, but when you have nothing, it's very hard to truly enjoy the car while knowing that any problems not covered by warranty will be financially devastating. Are you prepared to ride the bus for 4 weeks while saving enough income from work to replace a bad clutch? I had to do this, and it's not something I brag about." In my opinion it depends on the type of product. I would get a warranty for a washing machine or tumble dryer or other product with lots of moving parts that is liable to break down. I also take into account my luck, the one washing machine I didn't get covered broke down 2 weeks outside the normal warranty period... I would not get a warranty for a consumer electronics product like a TV, PC, or iPod because they devalue so quickly. As a rule of thumb, if the model you buy today is going to be on sale for the next few years for around the same price and has moving parts, it is worth considering a warranty. If it will be worth a small percentage of its value because newer faster shinier models come along to replace it don't bother. I would also not get the warranty from the shop I bought the product from. You can get warranties for consumer products from specialist third parties that will allow you to cover multiple products for a discount. These work out a lot cheaper than the one the shop will give you. For example in the UK, DomGen will cover 3 appliances for £14.99/month and 6 for £20.99/month