Do You Buy Extended Warranties?

[Mr Tonka]

Originally Posted by Beartato

What car costs $15K-20K to fix in a single incident?

Engine or Transmission for E9x M cars is the first that comes to mind. I think parts are something like $13k for a DCT transmission engine is upwards of $25k. I know the engine in my vehicle is more than $30k to replace with a new or factory refurb. They are almost $20k for used junk yard versions. There are others, i'm sure, but i'm not going to research them.

[Beartato]

Originally Posted by Mr Tonka

Engine or Transmission for E9x M cars is the first that comes to mind. I think parts are something like $13k for a DCT transmission engine is upwards of $25k. I know the engine in my vehicle is more than $30k to replace with a new or factory refurb. They are almost $20k for used junk yard versions. There are others, i'm sure, but i'm not going to research them.

I suppose if you're paranoid about catastrophic failure of entire systems then it might make sense to you, assuming your warranty actually covers the issue.

[RickFLM4]

It's not just the system failure but the labor involved in a diagnosis and fixes that sometimes precede the failure. If you don't have a warranty you could end up spending thousands trying other approaches to resolve symptoms before the catastrophic failure occurs and then still be left with the catastrophic failure.

Anyone buying a warranty clearly needs to review terms and conditions. Any warranty that excludes a catastrophic engine or transmission failure (minus deductible, if applicable) isn't worth buying.

[Mr Tonka]

Originally Posted by Beartato

I suppose if you're paranoid about catastrophic failure of entire systems then it might make sense to you, assuming your warranty actually covers the issue.

Powertrain warranties are fairly inexpensive and do tend to cover the powertrain. At a certain scale paranoia has nothing to do with it. It just makes good sense. There were a few well documented incidents of E92M3 engines failing outside of warranty and at the time, a replacement was 50% of the cars value, for some model years, it still is. An extended powertrain warranty cost $1800 at the time of purchase. For some people it makes sense. In the same way if you were to finance with nothing down, the $1.75 a month for GAP insurance is a reasonable decision.

To the point of my post, if one is driving a $15k car, an extended warranty isn't a good decision for the most part and one probably shouldn't be projecting their opinion of extended warranties onto people who drive vehicles worth 4 to 6 times as much.

[Beartato]

Originally Posted by Mr Tonka

Powertrain warranties are fairly inexpensive and do tend to cover the powertrain. At a certain scale paranoia has nothing to do with it. It just makes good sense. There were a few well documented incidents of E92M3 engines failing outside of warranty and at the time, a replacement was 50% of the cars value, for some model years, it still is. An extended powertrain warranty cost $1800 at the time of purchase. For some people it makes sense. In the same way if you were to finance with nothing down, the $1.75 a month for GAP insurance is a reasonable decision.

To the point of my post, if one is driving a $15k car, an extended warranty isn't a good decision for the most part and one probably shouldn't be projecting their opinion of extended warranties onto people who drive vehicles worth 4 to 6 times as much.

Mental gymnastics, got it

I'm just kidding, and I'd agree for the most part. For some people is does make sense. If I learned tomorrow the N55 is having a rash of [insert expensive issue here] failures in my M235i the first thing I'd buy is an extended warranty. Even outside of known issues with engines out of warranty the peace of mind I'm sure is worth it to some people. Me personally, I'm still of the opinion, as I said earlier in the thread, if I'm expected to buy an extended warranty for a car with the expectation that I'll use it I'm going to look at other cars instead.

[kscarrol]

Originally Posted by Beartato

Like this?

http://www.m3post.com/forums/showthread.php?t=874582

Yes but what they are talking about is proactively replacing the bearings before they fail. This is not covered but warranty. Having the rod bearings fail require extensive repairs and usually entail replacing the engine which gets you into that $15-$20k range...

Edit: Should have read your later responses first! Yes, there is a lot of paranoia about the rod bearings. I bought the warranty which has already paid for itself with my two throttle actuator failures.

[Mr Tonka]

Originally Posted by Beartato

Mental gymnastics, got it

I'm just kidding, and I'd agree for the most part. For some people is does make sense. If I learned tomorrow the N55 is having a rash of [insert expensive issue here] failures in my M235i the first thing I'd buy is an extended warranty. Even outside of known issues with engines out of warranty the peace of mind I'm sure is worth it to some people. Me personally, I'm still of the opinion, as I said earlier in the thread, if I'm expected to buy an extended warranty for a car with the expectation that I'll use it I'm going to look at other cars instead.

Those failure rates on today's cars are too low to be expected. But with high production numbers, there is no way to guarantee the odd failure won't happen. They do. If you own a 2012 E92 M with 60k miles and the engine/transmission fails, it sucks to be you if you don't have an extended warranty. If you can afford a $70k M3, an extra $1800 to mitigate the small, very small, likely hood of engine/transmission failure isn't that big of a deal. Is it mostly profit to the company offering it, yes. Are we all supposed to just buy things that companies break even on in terms of profit? I like turning a profit, so i'm ok with other companies making one as well.

I don't expect to use my car, life or home owners insurance policy, but i buy them.

[BayMoWe335]

Originally Posted by Mr Tonka

Those failure rates on today's cars are too low to be expected. But with high production numbers, there is no way to guarantee the odd failure won't happen. They do. If you own a 2012 E92 M with 60k miles and the engine/transmission fails, it sucks to be you if you don't have an extended warranty. If you can afford a $70k M3, an extra $1800 to mitigate the small, very small, likely hood of engine/transmission failure isn't that big of a deal. Is it mostly profit to the company offering it, yes. Are we all supposed to just buy things that companies break even on in terms of profit? I like turning a profit, so i'm ok with other companies making one as well.

I don't expect to use my car, life or home owners insurance policy, but i buy them.

Car, life, and homeowners insurance are apples and oranges compared to a car warranty.

1) Because car and home are required by law to have at least minimum coverage (although it's stupid to be under insured on those things)
2) Because those things have almost limitless liability and value (life)

The most you can really lose on the car itself is the price of the car.

Your point about $1800 for a powertrain on an M3 isn't $1,800 to protect $70,000. It's $1,800 to protect some percentage of $70,000 bc the car depreciates 50% in 4 years and 20% almost instantly. Then, it's really $1,800 to protect an even lower $ amount of what will go wrong. Even if the entire engine needs to be replaced (give me a break), it's still less than the total worth of the car.

$70k only matters because it's what you paid...it's really never worth that again.

[BayMoWe335]

Originally Posted by Mr Tonka

Powertrain warranties are fairly inexpensive and do tend to cover the powertrain. At a certain scale paranoia has nothing to do with it. It just makes good sense. There were a few well documented incidents of E92M3 engines failing outside of warranty and at the time, a replacement was 50% of the cars value, for some model years, it still is. An extended powertrain warranty cost $1800 at the time of purchase. For some people it makes sense. In the same way if you were to finance with nothing down, the $1.75 a month for GAP insurance is a reasonable decision.

To the point of my post, if one is driving a $15k car, an extended warranty isn't a good decision for the most part and one probably shouldn't be projecting their opinion of extended warranties onto people who drive vehicles worth 4 to 6 times as much.

If you're buying gap insurance, you're a moron anyway.

[RickFLM4]

Switching the topic from whether or not warranties are worth buying for a moment...

Does BMW underwrite their own extended warranties or is there a third party warranty most dealers sell? Audi, Lexus and some others sell brand-labeled policies from Fidelity (which doesn't cover BMW) and there is a dealer who works off volume, selling policies at around 60% of the price charged by other dealers. Anything like that with BMW?

Back on whether or not a warranty is worth it, does anyone know how much it costs to replace the a/c in an M car? (I understand that would not be covered by a power train-only warranty.)

[kscarrol]

Not a lawyer but as I understand it, homeowners insurance is not required by law. If you have a mortgage on the property they will require it but the law does not require it. Own your home free and clear and you do not have to have it. Foolish not to have it but not required by law.

Most states do have laws requiring auto insurance which make sense...

[Mr Tonka]

Originally Posted by BayMoWe335

Car, life, and homeowners insurance are apples and oranges compared to a car warranty.

1) Because car and home are required by law to have at least minimum coverage (although it's stupid to be under insured on those things)
2) Because those things have almost limitless liability and value (life)

The most you can really lose on the car itself is the price of the car.

Your point about $1800 for a powertrain on an M3 isn't $1,800 to protect $70,000. It's $1,800 to protect some percentage of $70,000 bc the car depreciates 50% in 4 years and 20% almost instantly. Then, it's really $1,800 to protect an even lower $ amount of what will go wrong. Even if the entire engine needs to be replaced (give me a break), it's still less than the total worth of the car.

$70k only matters because it's what you paid...it's really never worth that again.

Collision is not mandatory by law. It's been pointed out that home owner's isn't required by law when you own free and clear. Maybe you'd better understand the option to purchase renter's insurance? It's not required by law. I suppose those people are stupid too?

How is the price of the car the most you can lose? You lost the price of the car once you purchased it. The most you can lose is the price of the car and the cost of repairs, some of which can be extensive.

You further my point with the depreciation of the vehicle. When you buy a $70k vehicle, a replacement engine/transmission cost is a smaller percentage of the vehicle value. As your vehicle becomes less valuable, the replacement engine/transmission becomes a larger percentage of the vehicle value. Pretty much when just about every vehicle comes out of warranty is when the majority of depreciation has occurred. Your $70k vehicle is worth $45k in pristine condition and your engine/trans cost (parts & labor) is now as much as 50% or more of the vehicles value.

Give me a break?? How likely is it for a Honda Odyssey's transmission to fail? How likely is it for that same vehicle's replaced transmission to fail? How likely do you think it is for that same vehicle's second replaced transmission to also fail? Not very likely, yet i know the person it happened to. And even on that smaller value scale, they would have been screwed if they didn't have that extended warranty because at the time, with their kid being treated for cancer, they couldn't afford to absorb the cost of a transmission repair, let alone replacement, let alone 3 times. They sold that minivan the week after the 3rd tranny replacement. And thanks to that warranty, it wasn't sold as a parts car for 30% of the vehicles value. Does this happen often, no. Is this a singular event, no.

If you don't want to get an extended warranty, feel free not to do so. No one is calling you an moron for declining it.

[BayMoWe335]

Originally Posted by Mr Tonka

Collision is not mandatory by law. It's been pointed out that home owner's isn't required by law when you own free and clear. Maybe you'd better understand the option to purchase renter's insurance? It's not required by law. I suppose those people are stupid too?

How is the price of the car the most you can lose? You lost the price of the car once you purchased it. The most you can lose is the price of the car and the cost of repairs, some of which can be extensive.

You further my point with the depreciation of the vehicle. When you buy a $70k vehicle, a replacement engine/transmission cost is a smaller percentage of the vehicle value. As your vehicle becomes less valuable, the replacement engine/transmission becomes a larger percentage of the vehicle value. Pretty much when just about every vehicle comes out of warranty is when the majority of depreciation has occurred. Your $70k vehicle is worth $45k in pristine condition and your engine/trans cost (parts & labor) is now as much as 50% or more of the vehicles value.

Give me a break?? How likely is it for a Honda Odyssey's transmission to fail? How likely is it for that same vehicle's replaced transmission to fail? How likely do you think it is for that same vehicle's second replaced transmission to also fail? Not very likely, yet i know the person it happened to. And even on that smaller value scale, they would have been screwed if they didn't have that extended warranty because at the time, with their kid being treated for cancer, they couldn't afford to absorb the cost of a transmission repair, let alone replacement, let alone 3 times. They sold that minivan the week after the 3rd tranny replacement. And thanks to that warranty, it wasn't sold as a parts car for 30% of the vehicles value. Does this happen often, no. Is this a singular event, no.

If you don't want to get an extended warranty, feel free not to do so. No one is calling you an moron for declining it.

See where I said it is required by law to have minimum coverage, at least for car? Did I say collision or minimum? Also, since having a mortgage on a home is probably 90% of the cases, most of the time there is a requirement to have some insurance on it...but thanks for playing. Spin it however you want...there are laws on having car/home insurance but absolutely zero for an overpriced extended warranty on a depreciating asset. The extended warranty also doesn't cover you for killing someone, having an accident in your home, your (hopefully) much more expensive home being ruined, etc, etc, etc. Apples and oranges.

As far as the car cost...I meant if it becomes that much of a money pit, you'd probably be able to sell it for something to someone else and only be out "about" the price of the car...let's say you bought for $70k, put $20k in and sold for $20k, you're only out $70k total. If you buy a $70k car, put $20k into and get $0 out of it because you keep sinking more money into it (exceeding the value of just selling the stupid thing) you're also an idiot.

The rest of it...you're just a moron trying to justify a bad practice you can't conceive is stupid, because you do it.

[Joekerr]

[Mr Tonka]

Originally Posted by BayMoWe335

See where I said it is required by law to have minimum coverage, at least for car? Did I say collision or minimum? Also, since having a mortgage on a home is probably 90% of the cases, most of the time there is a requirement to have some insurance on it...but thanks for playing. Spin it however you want...there are laws on having car/home insurance but absolutely zero for an overpriced extended warranty on a depreciating asset. The extended warranty also doesn't cover you for killing someone, having an accident in your home, your (hopefully) much more expensive home being ruined, etc, etc, etc. Apples and oranges.

As far as the car cost...I meant if it becomes that much of a money pit, you'd probably be able to sell it for something to someone else and only be out "about" the price of the car...let's say you bought for $70k, put $20k in and sold for $20k, you're only out $70k total. If you buy a $70k car, put $20k into and get $0 out of it because you keep sinking more money into it (exceeding the value of just selling the stupid thing) you're also an idiot.

The rest of it...you're just a moron trying to justify a bad practice you can't conceive is stupid, because you do it.

I'm not spinning or trying to justify anything. I'm simply offering a different perspective to people who may not identify the situations where gap and extended warranty might be useful.

You're making comparisons which i am not. The similarities i'm making are really simple. Collision insurance is not required by law, yet many people purchase it. They are simply paying a fee to cover a portion of repairs for something that might or might not happen. Do you think those people are idiots? 10% of home owners (your uneducated guess) aren't required by law to insure their homes, yet most of those people do so. They are paying a fee, some times overpriced due to geographical area, to cover a portion of repairs or liability for something that might or might not happen. Are you saying they are idiots?

Just because you don't like extended warranties doesn't mean it's always a bad practice. Everyone gets it, you think it's stupid and can't conceive of any situation that YOU would be in to make such a decision a reasonable choice.

I have purchased gap insurance for one vehicle. I financed an E92 M3 with $0 down for .09%. Utterly stupid to put anything down when financing at that low rate. Yet if the car was totaled 4 months after rolling off the lot, i'd be out of pocket for the balance of the loan on a car i can no longer use. The gap insurance cost me per month about what most people spend on coffee per day.

I've purchased one extended warranty in my life, it was dirt cheap, more comprehensive than any i'd ever heard of, refundable if not used and it was for a first model year of a new Range Rover. I'm pretty sure EVERYONE will agree that was a wise decision.

I'm not a proponent of gap insurance or extended warranties. If someone here decides to purchase one in the future, i won't get a commission, not even a pat on the back. I'm only offering a perspective that many people may not see due to their limited experience. There really is little reason for you to argue the fact that gap ins and extended warranties make sense for some people in certain situations based on their financial position at that time of their life. Everyone is aware that you think extended warranties is a waste of money but it's not a simple yes they are worth it or no they are not worth it kind of decision which you make it out to be. It's different for everyone based on their needs, wants and financial ability.

[UncleWede]

^ <pats on back> good job explaining yourself without going all left or right or transgender or something

[SharpAndCunning]

This thread became a bit of a bickering contest. Why are we comparing extended warranties on m3 and m4's when this is a x1 forum.

shouldn't we debate whether or not it makes sense for us as, x1 owners, if it makes sense? Some of our cars, especially the 35i ones were high 40's. And many are still worth around 30k, even at 2-3 years old.

[RickFLM4]

Originally Posted by jpc647

This thread became a bit of a bickering contest. Why are we comparing extended warranties on m3 and m4's when this is a x1 forum.

shouldn't we debate whether or not it makes sense for us as, x1 owners, if it makes sense? Some of our cars, especially the 35i ones were high 40's. And many are still worth around 30k, even at 2-3 years old.

You are in the off-topic discussion board. Everyone is here not just X1 owners.

[SharpAndCunning]

Originally Posted by RickFLM4

You are in the off-topic discussion board. Everyone is here not just X1 owners.

Well shi*. I didn't realize that. Every other forum I belong to the off-topic discussion board is still specific to that one model.

Sorry. There's no foot in mouth emoji.