Re: GE Bumper to Bumper warranties

[William Murin <murinw@cs.uwp.edu>]

I have no experience with the specific warranty you mention, but I do 
have some direct experience with the concept.  

We had such a warranty on my wife's '85 5000s.  Now, back in '85 it only 
cost about $600 or so, and it picked up when the factory warranty 
expired--so for the first 2 years I was paying for something that I 
really did not get to use.  Make no mistake, these are high profit items 
for dealers (more on that in a bit).  Was it worth it?  You bet your 
sweet bippie.  In the 3 years we had the car after the factory warranty 
expired it had high buck sunroof repairs, rack and pump, window 
regulators, and any number of other things.  All covered.

What made it even more attractive was that several of the repairs were 
originally disallowed by the company holding the policy and the service 
manager at my Audi dealer fought like hell to get them covered--he was 
successful.

A friend of mine currently drives a '92 Dodge Caravan.  He was offered an 
extended policy when he bought it, turned it down because it was like 
$1400 or so.  But, through a long time friend of his who was service 
manager at a Dodge dealership back East, he bought the same identical 
policy for under $500--and his buddy admitted that there was some "minor 
profit" in it at that price.

One more case study--when I bought my 87 4kcsq in '88 with 15000 miles on 
it,I was offered an extended service policy.  I walked into the service 
department and asked the same service manager who had been taking care of 
my wife's 5k if I needed to buy the policy.  He said that since there was 
more than a year of Audi factory warranty left and since 4ks were less 
trouble plagued than 5ks, his advice was no. Followed his advice and 
have not regretted it.

So, what is the moral of this lengthy story:

1.  If the model has a history of high buck repairs that are covered by 
the extended policy, get the policy.

2.  Before doing #1, ask the service manager how long the dealership 
has been selling that particular policy, claims history, problems with 
the vendor, etc.

3.  If you can roll the price of the policy into the financing for the 
car (assuming that you are financing it) then the pain of the $1700 is 
spread out over the life of the loan.

4.  See if you can deal on the price of the policy.  Since there 
appear to be huge profit margins in these things, maybe the salesdude 
will take 1500, 1300, 1000, etc.

5.  Sometimes in order to close the deal you might even be able to get 
the salesdude to throw it in for free.  Warning: if he does this it 
might be because the policy covers nothing.  Some dealers carry more 
than one extended warranty plan.  So if he offers you "X" for $1500,  
you say throw it in for free and he agrees to throw in policy "Y", be 
cautious.  It might just be that "Y" really does not cover the items 
most likely to go bad.   

6.  Finally, think about your ability to pay for a major repair in 
case something does go bad in a year or two.

"nuff from me.  Good luck


Bill Murin