High hopes for the C-Max and the Extended Warranty as a hedge.

[knahs42]

I got my new Ford Cmax SEL today and love it.  I did not purchase the extended warranty from the dealer because he said it was $1,689 for a 7 year, 100,000 warranty but told me it would add $269 a month to my payment (which I knew was incorrect).  Since the Cmax has so much technology I was thinking the Ford ESP would be a good idea, especially since it is transferrable to a new owner if you sell before it expires (for a $75 fee).  I know Consumer Reports does not recommend ever buying an extended warranty and I have enver bought one either.  Just wondered if anyone has the extended warranty, feels it is a good idea, and have bought from an online selller.  I found the same 7 year, 100,000 warranty with $200 deductible for $1,125 from www.lombardfordwarrantys.com and they say it is honored at all Ford dealers and that they can offer that price due to volume.  Just wondering what everyone thought.

[plus 3 golfer]

I got my new Ford Cmax SEL today and love it.  I did not purchase the extended warranty from the dealer because he said it was $1,689 for a 7 year, 100,000 warranty but told me it would add $269 a month to my payment (which I knew was incorrect).  Since the Cmax has so much technology I was thinking the Ford ESP would be a good idea, especially since it is transferrable to a new owner if you sell before it expires (for a $75 fee).  I know Consumer Reports does not recommend ever buying an extended warranty and I have enver bought one either.  Just wondered if anyone has the extended warranty, feels it is a good idea, and have bought from an online selller.  I found the same 7 year, 100,000 warranty with $200 deductible for $1,125 from www.lombardfordwarrantys.com and they say it is honored at all Ford dealers and that they can offer that price due to volume.  Just wondering what everyone thought.

I chose the Mechanical Breakdown Insurance offered by GEICO with a $250 deductible.  It covers everything for a 100k miles except the exclusions below.  My costs were so far:  1st yr premium = $27.76; 2nd year premium = $27.64.   I will likely reach 100k miles in less than 6 years and expect to pay considerably less than the Ford Plans.  

 

The Ford Warranty covers the hybrid components for 8 yrs / 100k (longer in CA). See below for Hybrid components covered.  Major emission systems are covered for 8 /80k (see below).  The rest of the Power Train is covered for 5/60.

 

So given what's covered by Ford,  I don't expect the Geico rate to change much in year 3 and only increase slightly as the 3/36 B2B expires. I would expect an increase again at about year 5 when the power train warranty expires and maybe slightly again after the emission warranty expires.   I will likely reach 100k miles in less than 6 years and expect to pay considerably less than the Ford Plans.  The bad - I've got to stay with GEICO and should the C-Max experience significant out of warranty repairs at significant costs to GEICO, GEICO will increase the rate.  But, the major component that I worry about are the hybrid eCVT, the HVB, and the hybrid electronics which are covered by Ford for 100k miles.  

 

So, I believe MBI is the way to go rather than the Ford Plans.  But if you are risk averse, get the Ford Plan as it's a fixed price.  I can make a case for forgoing an extended warranty as the expensive stuff is covered for quite a while.

 

 

 

Geico EXCLUSIONS: MBI does not include regular maintenance services such as tune-ups, suspension alignment, wheel balancing, filters, lubrication, coolant and fluids, spark plugs, brake pads and lining, brake shoes and tires (includes tire wear and/or tire damage). Breakdown repairs made necessary by intentional damage, rust and oxidation, misuse, or improper maintenance are not covered. Mechanical Breakdown coverage is in excess of coverage provided by the manufacturer's warranty.

 

Hybrid Component Ford Warranty:

The following hybrid parts are covered during this extended coverage

period: high-voltage battery, hybrid continuously variable transmission,

Inverter System Controller (ISC), DC/DC converter, high-voltage

battery connector, battery pack fan assembly, thermistor probe, Hybrid

Battery Pack Sensor Module (HBPSM), Battery Energy Control Module

(BECM), and the PHEV onboard charger.

 

Federal Major Emissions

8 years or 80,000 miles (whichever occurs first) for catalytic

converters, electronic emissions control unit, and onboard emissions

diagnostic devices, including the Battery Energy Control Module

(BECM).

 

 

[nsteblay]

I don't know if was wise or not but I bought a 100K 7 yr no-deductible for $1,300.  I figured with it being so new and complex I will likely have repairs.  

[ScubaDadMiami]

I got the Ford 7/125,000 plan with tire warranty. It's just one less thing to worry about.

[Kelleytoons]

I, too, went with Geico (which is a steal if you have Geico insurance, which I already did and have for years).  It's one of those things they don't mention much but IMHO everyone who can get it should take advantage of it.

 

Let's face it -- they *always* make money off extended warranties, no matter who sells.  Just like with any insurance, if the company wasn't statistically making a lot of money off most people it wouldn't be in business.  You are basically hedging your bets against something catastrophic (which is why a deductible shouldn't even be a factor for you -- you don't want something to make you go "ouch" but you also don't mind that it's high because it's really only for that "once in a lifetime disaster" that you should be using it anyway).  

[TheXym]

I bought the Ford extended warranty w/tires and rims in 7/13. No big problems yet, but I've replaced a tire already (there was a screw in the road). I figure with the horrible shape of the roads around here due to the gas trucks (I live in the NE PA Marcellus Shale area) taking over roads that weren't built to handle the volume of traffic and the weight of large numbers of oversized vehicles the tires/rims alone are going to offset the cost.

[rfaunce]

I purchased a 6yr/100K Ford factory warranty with a $200 from an on-line Ford dealer for my 2013 C-Max for $945.  I purchased a 6yr/100K Toyota factory warranty with a $50 deductible for my wife's 2014 Prius from an on-line Toyota dealer for $885.

[rfaunce]

I purchased a 6yr/100K Ford factory warranty with $200 deductible from an on-line Ford dealer for $945.  I purchased a 6yr/100K Toyota factory warranty with $50 deductible from an on-line Toyota dealer for $885.  Remember, if you sell the car before the warranty expires, as I have done twice, you get a refund so its an even better hedge against a problem with cutting edge technology.

 

BTW, I have averaged 48-51 mpg since spring in my C-Max with most of the driving at highway speeds.  The Prius does about 5 mpg better under the same conditions but the C-Max is a better car feature for feature and it is crazily comfortable.

[tishpit]

Planning to pick up my new 2014 C-Max tomorrow.  Was thinking over extended warranty and with all the technology and such, thought it may be a good idea.  Ford dealership was wonderful to deal with and made the purchase a stress-free experience.  But their business manager quoted a hair over $3,000 for the Premium Care 1000+ Ext. Warranty (7 yrs/125,000 miles with $100 deductible).  That seems VERY steep to me.  Any ideas of where to find a better price?  Tried to talk him down and did not budge.  I know about the 0% financing, and this dealer also includes free oil changes for the life of the car (every 5 mos. or 5,000 miles).  Need some opinions!!!  (I am in Florida)

[shinytop]

There are dealerships where one can purchase the extended warranty over the internet.  Unfortunately Florida has a law that does not allow a purchase of the extended warranty except from dealers in Florida.  They are still available at much less than 3000 but you will have search using Google.  I found one I think by searching Ford ESP Florida.  The policy is in my car so I will try to remember to see where I bought it from.  It was more expensive than those offered out of state but Florida automobile lobbyists appear to be pretty influential.

[raadsel]

Planning to pick up my new 2014 C-Max tomorrow.  Was thinking over extended warranty and with all the technology and such, thought it may be a good idea.  Ford dealership was wonderful to deal with and made the purchase a stress-free experience.  But their business manager quoted a hair over $3,000 for the Premium Care 1000+ Ext. Warranty (7 yrs/125,000 miles with $100 deductible).  That seems VERY steep to me.  Any ideas of where to find a better price?  Tried to talk him down and did not budge.  I know about the 0% financing, and this dealer also includes free oil changes for the life of the car (every 5 mos. or 5,000 miles).  Need some opinions!!!  (I am in Florida)

 

You might also check and see if your insurance company sells Mechanical Breakdown Insurance. The price is typically much lower (I believe mine would be under $40 every six months), though in exchange you do typically have a deductible (I believe $250 on mine). You can also wait at least a year, or several thousand miles (I believe 18 months or 15,000 miles) before you have to add it. 

 

There are definitely pros and cons both ways, but it gives you another choice.

[markd]

We only paid $1,800 for the same warranty.

[SPL Tech]

An extended warranty, when considered from a mathematical and statistical standpoint, is not in your best interest. Actually, I would like to amend this and say ANYTHING a dealer sells you is probably not in your best interest. EVERYTHING a dealer and manufacturer does is to make money. They exist to help themselves by exploiting you. They are not your friend and they are selling you a product that they want to make money on. Do you honestly think Ford would offer an extended warranty at the price they do if they were loosing money on it? They are doing the math, they know how much money people are actually getting out of the in free repairs and they are charging enough that they continue to make money. That means as long as they are making money on you, you are loosing money. You're betting you will need the warranty, they are betting you will not. If they were wrong more often than right, the extended warranty would not exist.

 

So from a mathematical standpoint, which is really the only standpoint to take in a scenario like this, the math adds up to Ford's favor, not yours.

Edited April 11, 2015 by SPL Tech

[stevedebi]

An extended warranty, when considered from a mathematical and statistical standpoint, is not in your best interest. Actually, I would like to amend this and say ANYTHING a dealer sells you is probably not in your best interest. EVERYTHING a dealer and manufacturer does is to make money. They exist to help themselves by exploiting you. They are not your friend and they are selling you a product that they want to make money on. Do you honestly think Ford would offer an extended warranty at the price they do if they were loosing money on it? They are doing the math, they know how much money people are actually getting out of the in free repairs and they are charging enough that they continue to make money. That means as long as they are making money on you, you are loosing money. You're betting you will need the warranty, they are betting you will not. If they were wrong more often than right, the extended warranty would not exist.

 

So from a mathematical standpoint, which is really the only standpoint to take in a scenario like this, the math adds up to Ford's favor, not yours.

Statistically, yes. However, each car is different, and build quality can vary.

[Adrian_L]

If probability played any part in the decision to buy insurance, everyone would be idiots for buying house insurance given the .000001% chance of your place burning down.

 

And for that matter everybody walking into a casino would be an idiot as well!  (sorry, mother-in-law)

[plus 3 golfer]

We need to assure ourselves that should a catastrophe happen to us that might affect our lifestyle, we're covered and thus we can sleep at night and not worry about going to the casino and losing our money.  

 

I personally would hate to give up golf (and other higher cost pastimes) if my house were uninsured and burned to the ground. Hence, I carry homeowners insurance. :)  But I will not spend several thousand on an extended warranty for my C-Max for an extremely unlikely, high cost, unwarranted repair. MBI makes more sense to me since it really is an insurance product and not simply an "unregulated" (and thus high profit margin) maintenance contract.

[Adrian_L]

I'm both cheap and a risk taker.  So I don't bother with warranties (TV, extended car......etc.) or travel cancellation insurance.

 

But there are folks who want the peace of mind that an extended warranty brings.  It's their money to spend as they like.

[mlsstl]

As a commercial insurance broker for the past 38 years, insurance does its best work when the scope of the potential loss is very high compared to the cost of insuring it. At its most basic, an insurance policy is simply a written contract between two parties -- you agree to pay a premium and the insurance company agrees to compensate you for certain types of losses.

 

For many people, their home is their single largest investment, so it makes sense to insure property worth tens or hundreds of thousands for a relatively small premium.

 

Same with your car -- one momentary mistake could cause you to injure others who could sue you for all you are worth, and damage your own car. (The public liability portion is typically a greater portion of a car insurance premium than the physical damage part.)

 

However, when you begin asking insurance companies to insure the small, everyday stuff, either though very low deductiibles or by purchasing types of coverage that don't have a true catastrophic exposure, you begin "trading dollars" with the insurance company. Over the long term, this is very inefficient as the insurance company not only needs to charge for the losses they pay, but also need to cover their overhead & profit.

 

Extended warranties fall into this latter category. You may come out ahead or behind depending on what breaks and when, but the difference between the premium paid and the losses compensated is never going to be much, typically a few thousand at most, and that for a small percentage of buyers. So, over the long run, extended warranty insurance does not make statistical financial sense for the majority of buyers.

 

However, this does make sense is if you are the type of car owner who values budgeted peace of mind over the premium paid. For those people, it can be worth it.

[stevedebi]

...

 

However, this does make sense is if you are the type of car owner who values budgeted peace of mind over the premium paid. For those people, it can be worth it.

Yeah, that describes my situation. I always get the extended warranty to cover the amount of time/miles I expect to use when paying a loan. That way I know my costs so long as I'm making payments, and I never have unexpected repair costs while still making those monthly payments.

 

After the loan is paid, I can easily save up the money to make repairs.

[raadsel]

As a commercial insurance broker for the past 38 years, insurance does its best work when the scope of the potential loss is very high compared to the cost of insuring it. At its most basic, an insurance policy is simply a written contract between two parties -- you agree to pay a premium and the insurance company agrees to compensate you for certain types of losses.

 

For many people, their home is their single largest investment, so it makes sense to insure property worth tens or hundreds of thousands for a relatively small premium.

 

Same with your car -- one momentary mistake could cause you to injure others who could sue you for all you are worth, and damage your own car. (The public liability portion is typically a greater portion of a car insurance premium than the physical damage part.)

 

However, when you begin asking insurance companies to insure the small, everyday stuff, either though very low deductiibles or by purchasing types of coverage that don't have a true catastrophic exposure, you begin "trading dollars" with the insurance company. Over the long term, this is very inefficient as the insurance company not only needs to charge for the losses they pay, but also need to cover their overhead & profit.

 

Extended warranties fall into this latter category. You may come out ahead or behind depending on what breaks and when, but the difference between the premium paid and the losses compensated is never going to be much, typically a few thousand at most, and that for a small percentage of buyers. So, over the long run, extended warranty insurance does not make statistical financial sense for the majority of buyers.

 

However, this does make sense is if you are the type of car owner who values budgeted peace of mind over the premium paid. For those people, it can be worth it.

 

This sounds like part of the reason MBIs are typically so much cheaper than the extended warranties you buy through dealers. Since it is an addition to an existing policy, the insurance company doesn't need a lot of extra profit on the MBI alone. By contrast, not only is the insurance company needing to recoup administrative fees but the dealers want some of the profit as well, often quite a bit of profit, which causes large markups on extended warranties.

[stevedebi]

This sounds like part of the reason MBIs are typically so much cheaper than the extended warranties you buy through dealers. Since it is an addition to an existing policy, the insurance company doesn't need a lot of extra profit on the MBI alone. By contrast, not only is the insurance company needing to recoup administrative fees but the dealers want some of the profit as well, often quite a bit of profit, which causes large markups on extended warranties.

Yes, especially in the past. These days you can get the offical Ford ESP warranties from dealers over the Internet, and the local dealer will generally match the price.