Look to cancel an extended warranty plan but the dealer won't let you cancel it anymore referring to the terms and conditions that you signed at the time of buying the warranty? Fear not, in this article we break down the legal and other aspects that can prevent such occurrences and help you cancel your warranty.

How Do Extended Warranties Work?

An extended warranty refers to a service contract that covers a range of repairs after the manufacturer's warranty is over. The coverage of an extended warranty program usually begins after the expiry of the manufacturer's factory warranty program. A typical Extended Warranty program covers repair and replacement costs of electrical and mechanical components, which in some cases include problem areas not covered by the manufacturer. A warranty program can last anywhere from one to eight years and most manufacturers offer in-house extended warranty programs while you purchase your vehicle.

Both third-party and manufacturer warranty programs start from as low as $1000 and pre-repair deductibles reach as high as $100.Warranty coverage can come in handy if you don't want to spend money later or choose to purchase a vehicle that costs higher than usual to run and maintain. In cases of affordable and reliable cars, the warranties might not be as useful especially if you walk around with enough savings to cover occasional repair bills. Before buying an extended warranty make sure you evaluate providers based on cost, coverage, and convenience. Also, don't forget to compare policies and negotiate to get the best possible deal.

Based on expert analysis, Endurance is the leader in the extended warranty space, closely followed by CARCHEX and Protect My Car. Apart from these or any other third-party provider, one can always opt for an in-house extended warranty offered by the manufacturer which tends to be an easier experience and can be added at the time of the vehicle's purchase. Companies have also started offering extended warranty services for used cars. It adds all the befits as discussed above to your used car and can be worth the extra cash if you intended to keep the vehicle for a long time.

Why Would a Dealer Refuse to Cancel Extended Warranty?

In most cases, the reason a dealer can give for refusing to cancel an extended warranty is if you are making the cancellation request after the cut-off point. More often than not, a warranty provider will put a condition in the contract, stipulating a strict period for backing out of the warranty plan. This period can range anywhere between 30 and 60 days and these details are often mentioned in fine print, deliberately placed at the bottom of a page to not alarm potential customers who might be in doubt.

If you manage to put up a cancellation within this period, then you are entitled to a refund on your extended warranty, no questions asked. However, cancellations should still be allowed unless the contract signed by you clearly states that you can't after the aforementioned period.

If your contract doesn't mention anything along those lines then you should be allowed to cancel at any time and receive a prorated refund for it, however, this might not be possible if you have already claimed under the extended warranty.

What Can I Do If My Dealer Refuses To Cancel an Extended Warranty?

Dealing with sketchy customer service representatives is the biggest problem people face when it comes to canceling their extended warranty. They will resort to extreme measures to keep you from canceling your warranty plan by sucking you into a newer and seemingly "cheaper and better" warranty plan or by making false statements that might mislead you and prevent you from canceling the extended warranty.

In any case, if the dealer is adamant and won't agree to a reasonable settlement, you can take the following steps to resolve the situation.

Always go through the contract

The contract is an iron-clad and foolproof document that can easily save you from such sticky situations, hence it is crucial to know your contract and it is highly recommended to go through the fine print which will have a cancellation policy followed by the warranty provider.

Don't stick to a single point of contact

Always try approaching more than one representative from the company as the sales officer who sold you the extended warranty is probably the worst point of contact in such situations because a canceled contract will result in them losing their commission so they will try their level best to resist any such attempts.

Fill Out the Cancellation Request In Person

Most dealerships will provide you with a cancellation form which can either be mailed or filled in person. Choose the latter if you want to. Ensure faster settlement.

If things are getting out of hand, bring in a lawyer. This is an absolute worst-case option but bringing in legal help will practically assure fast resolution as a lawsuit is not just an unnecessary waste of time and money for the warranty provider but also a ding on their reputation which they will try to avoid any cost. This is also the best option if you are a victim of fraud.

Try a Specialty Service

You can also approach services that specialize in vehicle claim-related disputes. DoNotPay.com is one such service that will help you get out of a sticky situation if your dealership does not budge.

What Are The Top Extended Car Warranty Providers?

When it comes to third-party warranty providers, we strongly recommend getting in touch with them to try and get the best deal since most of them will offer you a discount over the quoted price if you ask for one. Olive and Endurance are some of the best third-party warranty providers that offer the option of transferring ownership. Here's a brief review of these providers:

Uproar:

Uproar is based out of Seattle, Washington, but it’s not like any other extended car warranty company out there. Uproar bills itself as an innovator, which makes a lot of sense considering it’s the first extended warranty company to offer a 100-percent digital, subscription-based experience. The main highlights of uproar include an instant quote and signup online, same-day coverage, no long-term commitments, transparency, and no aggressive salespeople or robocalls. They are BBB accredited and have five-star ratings from both Google and Consumer Affairs.

Endurance:

Endurance offers Coverage for cars up to 20 years old which makes it ideal for used car owners. They offer hassle-free inspection after which the claim can be filed, making the entire process foolproof and they aim to ensure that you don't miss minor details which might cause you trouble in the future. They also offer membership benefits which add to the whole customer experience and help them secure the top spot.

Olive:

One of the newest players in the business, apart from extended warranty plans, it also offers mechanical breakdown insurance in California. It has also secured some of the best consumer ratings courtesy of its top-notch service and a wide range of plans that deliver timely resolution of claims.