Methodology: How We Rate Car Warranty Companies

Our team prides itself on providing accurate and unbiased information about car warranty companies to help inform consumers’ purchasing decisions. We’ve collected data from 46 warranty providers about their industry standing, coverage, cost, transparency, and customer service to determine the top companies on the market.

Our Research Process

Our process is backed by nearly 1,500 hours of research into leading providers in the warranty industry. We collect over 2,200 data points related to key rating factors to provide a thorough picture of each warranty company. To ensure we’re providing you with the most up-to-date information, we update our research several times each year.

Our team has also surveyed 2,000 consumers who have purchased an extended auto warranty. We use information from respondents to get a clear sense of the customer experience, ranging from satisfaction with different aspects of their warranty coverage to which factors are most important when purchasing a coverage plan.

Lastly, to obtain first-hand product knowledge our team bought five warranty plans from separate providers to test the coverage levels and claims process of each company.

Companies receive a score in each of the following categories, as well as an overall weighted score out of 5.0 stars.

Industry Standing (15 Percent)

Warranty providers with a history of strong business practices and a positive reputation within the warranty industry receive the highest scores in this category. Our goal is to provide an overall reputation score that can indicate the trustworthiness of a business. We review more than 45 providers but only recommend the most reliable companies.

To calculate this score, our team evaluates:

Better Business Bureau (BBB) rating and accreditation
Number of years in business
State availability
Industry partners
Plan administrators
Awards

The average Industry Standing rating of all the providers we reviewed is 4.1 out of 5.0. Here’s what the different star ratings within this category mean:

5.0 Stars: Companies that earn 5.0 stars are the most reliable and reputable car warranty companies. They’ve been in business for more than 20 years, operate nationwide and internationally, and have an A+ BBB rating.
4.0 Stars: Those with a 4.0-star rating exhibit strong business practices and hold high ratings from the BBB. They’ve been in the industry for many years.
3.0 Stars: Auto transport companies that have a 3.0-star rating have average industry reputations. They hold decent BBB ratings, though not as high as more reputable companies, and may not have been in business for that long.
2.0 Stars: Car shippers with a 2.0-star rating are less reputable options in the industry. They generally hold average or lower BBB ratings and often have more limited shipping availability across the U.S.
1.0 Star: Those that receive 1.0 star in this category have a poor industry reputation. They are not reputable companies and typically hold D or F ratings from the BBB.

Coverage (30 Percent)

The best extended warranty companies offer high-quality coverage to consumers. We take a close look at the range of coverage options available to consumers, as well as which companies offer unique coverage types that competitors may not offer.

Our team considers the following factors when determining coverage scores:

Number of coverage levels available
Basic powertrain plan and exclusionary plan availability
Maintenance coverage availability
Maximum coverage term and mileage limit
Waiting period for coverage to begin
Additional benefits like roadside assistance, towing, rental car coverage, trip interruption, and more

The average Coverage rating of all the providers we reviewed is 4.3 out of 5.0. Here’s what the different star ratings within this category mean:

5.0 Stars: Providers that earn 5.0 stars in this category typically offer five or more plans ranging from basic to comprehensive coverage. They likely offer unique additional options as well, like maintenance coverage. The top companies have long coverage terms and high mileage limits – often up to 200,000 miles and above – and they include benefits like roadside assistance with their plans.
4.0 Stars: Those with 4.0-star ratings offer a strong coverage selection, with several plan options and coverage levels to choose from. Their contracts come with a range of benefits and cover vehicles up to a high mileage limit.
3.0 Stars: Companies that earn 3.0 stars have a decent coverage selection – typically one or two other plans in addition to standard powertrain and comprehensive coverage options. They may include some additional perks and generally offer more limited contract terms, with coverage up to about 100,000 miles.
2.0 Stars: Coverage from a company that earned a 2.0-star rating is bound to be very limited. There are few plan options available, the plans don’t offer many or any additional benefits beyond standard coverage, and the coverage terms are lower than most competitors’ terms in the industry.
1.0 Star: Warranty providers with 1.0 star offer poor coverage selections with only one or two plans, making it difficult for consumers to find the right coverage for their needs. Their contracts don’t offer additional benefits and have some of the lowest mileage limits available.

Cost (20 Percent)

Cost is one of the factors that’s most important to consumers when looking for warranty coverage. Because of this, our research team takes a thorough approach to gathering transparent cost data.

We reach out to different companies for quotes for a variety of plans and vehicles. Using over 140 individual quotes, we calculate average costs per year of coverage overall and by coverage level. We use this cost data to get a sense of how each company’s costs compare to the industry standard and to help give you a clearer idea of what you may pay for coverage. Companies with lower prices per year of coverage, multiple deductible options, and discount opportunities available receive the best scores.

We evaluate providers on the following factors in this category:

Total plan cost compared to the industry average
Cost per year of coverage compared to the industry average
Monthly costs for exclusionary, mid-level, and powertrain plans compared to the industry average
Deductible options available
Discounts available

The average Cost rating of all the providers we reviewed is 4.1 out of 5.0. Here’s what the different star ratings within this category mean:

5.0 Stars: Car warranty companies that earn the highest 5.0-star rating offer the lowest prices in the industry. Their costs per year of coverage for powertrain, mid-level, and exclusionary plans are affordable, and they offer several deductible options.
4.0 Stars: Those with 4.0-star ratings have affordable or average rates for most warranty coverage plans. They typically offer multiple deductible options and may have discounts available to help consumers save.
3.0 Stars: Companies rated 3.0 stars have average prices across the board and more limited options when it comes to deductibles and discount availability.
2.0 Stars: Those with 2.0-star ratings have a mix of average and above-average prices across all warranty plans. They don’t typically offer any discounts and have few deductible options.
1.0 Star: Providers with a 1.0-star rating are some of the most expensive on the market. They may only have one deductible option available and don’t offer any discounts.

Transparency (20 Percent)

It’s important to look for a warranty company that’s transparent about the coverage and service it offers. We keep our ratings simple in this category: If a provider allows you to view sample contracts on its website and offers a money-back guarantee, it receives the highest rating.

The average Transparency rating of all the providers we reviewed is 3.4 out of 5.0. Here’s what the different star ratings within this category mean:

5.0 Stars: Warranty providers that earn 5.0-star ratings offer a money-back guarantee within at least the first 30 days of your contract. They also make it easy to cancel your coverage if you choose to do so and make sample contracts clearly available on their sites.
4.0 Stars: Those with 4.0-star ratings typically offer a money-back guarantee and sample contracts. However, these contracts generally aren’t available on the company’s site and will need to be specifically requested.
3.0 Stars: An extended warranty company with a 3.0-star rating may offer a money-back guarantee, but it makes the cancellation process very difficult. These providers also make it challenging to access a sample contract before purchasing coverage.
2.0 Stars: Those with a 2.0-star rating do not offer money-back guarantees. Their cancellation process is a hassle and may require a high fee, and they do not make sample contracts available.
1.0 Star: Companies that receive 1.0-star ratings do not offer a money-back guarantee or sample contracts at all.

Customer Service (15 Percent)

Great coverage options and affordable prices don’t mean much if a company lacks good customer service. Our team analyzed 3,850 reviews on sites like the BBB and Trustpilot to get a sense of the customer experience with leading warranty providers. We look for patterns in the reviews that highlight what makes a company stand out and the pain points consumers typically experience.

We also perform our own shopper analysis to get a sense of the responsiveness and helpfulness of each warranty company and its representatives. When speaking to representatives, our researchers assess issues like whether agents are more likely to explain coverage or are focused only on making a sale. We evaluate the overall ease of each provider’s quotes process when calculating this rating as well.

The factors we evaluate when determining customer service scores include:

Ease of the quote process based on our secret shopping experience
Customer review scores from the BBB and Trustpilot
Complaints logged with the BBB
Mobile app availability and ratings in the App Store and Google Play

The average Customer Service rating of all the providers we reviewed is 3.7 out of 5.0. Here’s what the different star ratings within this category mean:

5.0 Stars: Car warranty companies with a 5.0-star rating offer the best customer experience. They earn some of the highest customer review scores on the BBB and Trustpilot (typically above 4.0 stars for the warranty industry), have a simple and straightforward online quote experience, and offer features like a highly rated mobile app or online chat.
4.0 Stars: Those that earn 4.0 stars in this category have strong customer service reputations. They receive high review scores from customers and make it easy to get a quote from the company. Many offer additional features that enhance the customer experience.
3.0 Stars: Companies with a 3.0-star rating have average customer service. Review scores from customers tend to be average across the board, and these warranty companies often have higher complaint numbers than higher-rated companies.
2.0 Stars: Those with 2.0 stars generally don’t offer a positive customer experience. They receive low review scores and a high number of complaints from customers. It’s often much more challenging to get a quote through these providers.
1.0 Star: Providers with a 1.0-star rating provide poor customer service. They field many customer complaints and make getting a quote a hassle.