Service contracts are an additional type of car warranty that an auto dealer might offer when you purchase a new car. Unlike a warranty, a service contract costs extra, rather than forming part of the original price. The purpose of a service contract is to cover the cost of certain services and repairs.
These contracts should be thoroughly researched before you purchase one. In some cases, the contract covers the same services and repairs as the included warranty. You should also know who is obligated to perform all covered services and repairs. Independent companies, car manufacturers or dealers can be responsible.
What’s Covered in a Service Contract?
Service contracts vary greatly based upon who offers them. Unlike manufacturer services or an extended car warranty, services can range from oil changes to any and all necessary repairs for a specified period.
All details are listed in the contract itself. Ask questions before purchasing and weigh the benefits of the services provided against the cost. You are not required to add a service contract.
Only purchase a service contract if you want one or feel it is a good supplement to your included warranty.
