BMW warranty - Why do people purchase?

Engram · 20 Feb 2012 at 15:39

I see a lot of encouragement to purchase a BMW insured warranty (for most 2nd hand models) but I wonder what the reasoning behind that is. Is it because:

a) Not everyone can afford to keep £1-2k in cash ready for large repairs?
b) The highly likely cost of repairs exceeds all of the money spent on warranties?
c) The possible cost of repairs exceeds all of the money spent on warranties?
d) Some other reason.

The general advice when considering a warranty on white goods, TVs etc is "don't bother" - save all of the money that you would have spent on warranties and it will easily cover any repairs. Does the same not apply to a BMW warranty?

EDIT: Please note that I'm not talking about free warranties, like the ones that you get with a new or approved used car.

nucastle · 20 Feb 2012 at 15:45

The first year warranty on my E92 M3 was the only thing that kept me from swinging on a rope when i bought it from an AUC.

Within the first year it was in to get fixed about 4-5 times and required

- pressure hoses replaced
- full wiring harness replacement
- throttle actuator replacement

... probably 3-5k worth of repairs. I've now learned my lesson about trying to save a few bob while buying sports/premium cars privately - Much greater peace of mind knowing you can make a quick phonecall to Sytner and know you are going to get looked after.

I'd balance it up with the cost/age of the car tho.

Engram · 20 Feb 2012 at 15:48

What's an AUC?

3-5k of repairs is obviously a lot of money, but will it need that every year? And how much money do you think you will spend on the warranty during the time that you own the car?

jaybee · 20 Feb 2012 at 15:50

With warranties, alarm bells ring in my head basically telling me I will be stitched up and whatever goes wrong will be considered "wear and tear" or "not covered" so I never bother with them. Having experienced exactly this myself in the past I tend to avoid warranties with almost everything I buy to be honest.

Haggisman · 20 Feb 2012 at 15:55

jaybee said:
With warranties, alarm bells ring in my head basically telling me I will be stitched up and whatever goes wrong will be considered "wear and tear" or "not covered" so I never bother with them. Having experienced exactly this myself in the past I tend to avoid warranties with almost everything I buy to be honest.

Got to say I'm in the same boat here - warranties generally aren't worth the paper they're printed on, come claim time the company will point you at a huge list of conditions and exclusions, vague enough that at least one of them will invariably cover whichever item it is that happens to have gone wrong.

Better to stick whatever the warranty costs in a bank account - at least that way you have some money to do the repairs!

Basher · 20 Feb 2012 at 15:57

Haggisman said:
Got to say I'm in the same boat here - warranties generally aren't worth the paper they're printed on, come claim time the company will point you at a huge list of conditions and exclusions, vague enough that at least one of them will invariably cover whichever item it is that happens to have gone wrong.

Better to stick whatever the warranty costs in a bank account - at least that way you have some money to do the repairs!

Have you ever had a BMW warranty? Ivenever had any issues with claiming. I've claimed for about 1.5k worth of stuff in the past 18 months.

Engram · 20 Feb 2012 at 15:58

Haggisman said:
Better to stick whatever the warranty costs in a bank account - at least that way you have some money to do the repairs!

That's good advice unless option A or B apply (from my OP).

Engram · 20 Feb 2012 at 15:59

Basher said:
Have you ever had a BMW warranty? Ivenever had any issues with claiming. I've claimed for about 1.5k worth of stuff in the past 18 months.

Yes, I do hear good things about the way the BMW warranty scheme is managed.

How much money have you spent on the warranty though?

Basher · 20 Feb 2012 at 15:59

Engram said:
Yes, I do hear good things about the way the BMW warranty scheme is managed.

How much money have you spent on the warranty though?

Nothing yet. It was AUC so came with 2yrs warranty.

Engram · 20 Feb 2012 at 16:01

What's AUC? :mad:

EDIT: Ah.. Approved Used Car

Skeeter · 20 Feb 2012 at 16:03

Most advice comes when people look at buying second hand BMWs.

Buying a car that was £50k new for £10k doesn't mean that repair and servicing costs will also have dropped by 80% too. The car will still produce "£50k car" bills, so the warranty helps sooth the pain of those.

LiE · 20 Feb 2012 at 16:03

Approved Used Car

Engram · 20 Feb 2012 at 16:06

Basher said:
Nothing yet. It was AUC so came with 2yrs warranty.

I think it's important to make a distinction between a free warranty (like the one that you've used) and an insured warranty (like the ones that you can buy here).

The AUC warranty is a guarantee that the car will not suffer from particular faults for a certain period of time (and if it does, it will be repaired), whereas the insured warranty is a "gamble".

Basher · 20 Feb 2012 at 16:08

Engram said:
I think it's important to make a distinction between a free warranty (like the one that you've used) and an insured warranty (like the one's that you can buy here).

The AUC warranty is a guarantee that the car will not suffer from particular faults for a certain period of time (and if it does, it will be repaired), whereas the insured warranty is a "gamble".

But the level of service etc gives an indication as to whether I am likely to pay for it once it's up.

Engram · 20 Feb 2012 at 16:09

Basher said:
But the level of service etc gives an indication as to whether I am likely to pay for it once it's up.

Do you mean: because you've already had expensive bills you expect more in the future?

Basher · 20 Feb 2012 at 16:11

Engram said:
Do you mean: because you've already had expensive bills you expect more in the future?

Yes. And also the ease of getting this sorted (i.e. no quibbles on if it was covered in the warranty).

Engram · 20 Feb 2012 at 16:13

Skeeter said:
so the warranty helps sooth the pain of those.

Soothing because it lowers the cost of ownership (my option B)? Or soothing because it protects against huge bills (my option C)?

Skeeter · 20 Feb 2012 at 16:18

C, I suppose. You can pick up wafty executive luxo barges for hatchback money, but it doesn't stop them throwing up luxo barge bills.

Myshra · 20 Feb 2012 at 16:19

Warranty rates in consumer goods run at around 7%, isn't it a lot higher for car repairs? Comparing price of a warranty as a % of the cost to replace the asset, isn't the car warranty a lot better value too?

Probably worth noting that there is 3 types of warranty on a BMW: http://www.bmw-warranty.co.uk/Pages/Information.aspx?page=Products/ComparisonPopUp.htm&popup=1

naefeart · 20 Feb 2012 at 16:22

Engram said:
... whereas the insured warranty is a "gamble".

Why is it a gamble?

You pick your level of cover and this way you know what is and isn't covered. Wear and tear items are not covered. Saying that, I've had such items covered in the past as good will gestures.

You can't compare BMWs to white goods. I don't have any white goods that have the same level of cost to buy or run as my car.

You can either buy a warranty or choose to squirrel money away each month. Depending on the car and your experience, you may find a warranty is a cheaper option.

It's a subjective thing. At the end of the day you weigh up the pros and cons and make your own choice.