Do RV Extended Warranties Ever Pay Off?

[PG JOHNSTON]

Just realized that there are ZERO VALID warranty companies. After spending hours researching RV warranty companies and conversing with my mobile repair expert! There are ZERO VALID RV warranty companies. Plenty of companies but NOT ONE that has been valid as determined by those that actually do the repairs.
We pay for the repairs as our Forest River trailer as I can fix or my RV Mobile local!
There are a huge amount of companies that offer warranty repairs but have seen a consistent instances where the warranties were a completely impossible or insanely complicated to apply to RV owners needs.
Which leads me to a suspect a nation wide warranty scam is ruining the RV community?
I have exhaustive research and have come up with ZERO application for any warranty contract that has not been a quagmire in a mud pit!
Tell me ...DOES ANYONE HAVE A POSITIVE RELATIONSHIP WITH WARRANTY COMPANIES?

 

[Primerump]

The most positive relationship I have had is to NEVER USE THEM. period.
most RV's in production, especially covid era are in my opinion just "lemon law worthy".
put some money aside in an interest bearing account for future repairs and call it a day.

 

[Ex-Calif]

All warranty is a for profit business.

Nationwide the payout rate is about 30% of premiums paid.

 

[Gary RV_Wizard]

Just realized that there are ZERO VALID warranty companies. After spending hours researching RV warranty companies and conversing with my mobile repair expert! There are ZERO VALID RV warranty companies. Plenty of companies but NOT ONE that has been valid as determined by those that actually do the repairs.
We pay for the repairs as our Forest River trailer as I can fix or my RV Mobile local!
There are a huge amount of companies that offer warranty repairs but have seen a consistent instances where the warranties were a completely impossible or insanely complicated to apply to RV owners needs.
Which leads me to a suspect a nation wide warranty scam is ruining the RV community?
I have exhaustive research and have come up with ZERO application for any warranty contract that has not been a quagmire in a mud pit!
Tell me ...DOES ANYONE HAVE A POSITIVE RELATIONSHIP WITH WARRANTY COMPANIES?

What do you mean by "valid"? While I do not recommend buying an RV extended warranty, I don't think they are any more (or less) a scam than most any form of repair insurance. You pay a fat premium for a repair/replace service you hope you never need. And since few buyers ever bother read the actual insurance contract ahead of time, they are near always shocked to learn that the coverage is not all that they expected when they listened to a glib sales person.

The nature of insurance is that a lot of people pay in and only a few get back more than they paid in. It's not a financial investment.

 

[TheBar]

Third party car and house warranties are the same. The insurance business model is to never pay out as much as you pay in. If they did they wouldn't be in business long.

Just create a separate bank account and put in the same amount as the insurance premium every month. You will make money in the long run. I have 4 similar accounts. Banks do not charge any maintenance fees on an account if you keep a minimum balance in them. I label my accounts so my wife or the executor of my will will know what was reserved for what.

I had life insurance at work but it ended when I retired. So I cashed in my extra life insurance and started paying myself the same premium decades ago. The account has grown enough to now earn 3.75% interest compounded monthly.

I no longer needed to contribute to it after I retired. The interest alone pays 20 times more than what the premium was so its growing fast. It is now worth 40 times what the original death benefit would have been. I would do the same with my house but the mortgage company requires insurance.

 

[Kirk]

Third party car and house warranties are the same. The insurance business model is to never pay out as much as you pay in. If they did they wouldn't be in business long.

The first and most important thing to remember about what they call extended warranties is that they are not warranties at all but rather insurance on the health of the RV, or whatever you are covering. I have researched RV Extended Warranties extensively and have written articles about them which were published in three different RV magazines and one of them had me update it and published it again. (10+ years ago) Like any insurance company, they are a for profit business and as such they must take in more in premiums than they pay out, each financial period. It doesn't matter what type of insurance you are discussing, all of them must do that in order to stay in business. The only time you actually recoup more than the cost of any insurance policy is if you have a major disaster claim. We had friends who had a Ford V-10 engine replaced via their "extended warranty" and only paid the deductible of less than 10% of what it cost, but the warranty that they had was also an expensive one and they did recover far more than it cost.

In the RV community, I found that the lower the cost of the "extended warranty" the fewer satisfied customers. At the same time, the higher priced ones had more satisfied customers. I have had one on my RV only one time and I was very satisfied with the result. It paid what the contract said that it would on both the chassis and the RV part and over the 7-year life I recovered about 80% of the original cost. I bought it to sleep better because of our financial situation. Because the situation was different, I didn't renew it. The purchase of insurance or an extended warranty should always be a business decision. You only insure for things that would be financial disaster if they were to happen, but never for things that you could pay without insurance. When or if you do consider an extended warranty, before you sign anything make sure that you read and understand every word of the contract, what they do pay, what they do not pay, and what the deductible is for all claims, and how to get a claim approved.

It is foolish to sign any contract without having read and understood it all. By far the majority of unhappy purchasers of extended warranties have not read the contract that they signed in full, if at all. The same is true for most business contracts. My wife was a bank loan officer for 8 years and in that time she only remembers two customers who took the time to read all of the loan documents.

 

[RayIN]

The odds of having a satisfactory experience with any service contract is directly related to how well the fine print in the contract is read and understood.
When we bought this MH it had been parked in a barn for 8 yrs. We assumed some things would fail to work properly as a result of non-use. We were correct, we submitted numerous claims on items connected to the house/coach part of the MH and all were paid, no rejections. I believe that happened because I read all the fine print and understood the whys, hows, and operation of the claims process.
At the end of the initial 3-yr contract, by my figures the insurance company had paid-out more than the total of the premiums and deductibles by about $400. No claims were submitted on the chassis or drivetrain, and all fluids were changed at time of purchase.
Would It buy another service contract? The answer totally depends on circumstances at that time.

 

[Bearcatrp]

Best to find a real good rv repair shop that ream you on the costs. I’m lucky I found one. Charge half of what rv dealers would charge for a repair. Extended warranties are not worth the money.

 

[John From Detroit]

I've dealt with two One covered a less than a $1,000 repair on my Jeep Cherokee Latitude
THe other refused a 12000 repair on my Grand Cherokee.

They all claim "We will fix it" But well... My mechanic has dealt with them all and what he says.. I believe (And well.. Let's say he did not use "bad language" but he gave the impression he would have liked to..

The company claimed that I had to know an internal engine problem existed when I signed the agreement... What... I've got X-Ray vision I can look into the engine?

All I know is Torque showed no errors. Then I signed, made payments and Torque (months later) detected a misfire.

 

[Gary RV_Wizard]

The OP hasn't been back since a few hours after his first & only post, so we are all "preaching to the choir".

 

[DonTom]

I wonder how much commission they get on warranty sales.

A couple of months ago when I purchased my Can-Am Origin motorcycle, I asked the salesman what the out the door price should be. I was told it should be very close to $12,200.00 OTD.

Even though I was paying cash to buy the thing, the Finance Department does all the paperwork. The total price there was above 14K$, around 2K$ more than I was quoted. So I looked at the contract and noticed he tried to sneak in a $2,000.00 extended warranty that I never asked for. So of course, I question that, and he give me the BS line "well, of course you want the extended warranty!" and other BS reasons of why. When I made it clear I was ready to walk out without signing anything, he then redid the contract and then the OTD price was $12,151.77.

IOW, always ask the salesman about the OTD price before buying in case other stuff is added into the contract that you never asked for. The salesman wants to make the price look reasonable to get the sale. After that, be careful on what you sign.

-Don- Kingston Camp, NV

 

[Kirk]

PG JOHNSTON​

New Member · From fLORIDA
Joined Saturday at 9:09 AM
Last seen Saturday at 1:19 PM

 

[Casemat]

Just realized that there are ZERO VALID warranty companies. After spending hours researching RV warranty companies and conversing with my mobile repair expert! There are ZERO VALID RV warranty companies. Plenty of companies but NOT ONE that has been valid as determined by those that actually do the repairs.
We pay for the repairs as our Forest River trailer as I can fix or my RV Mobile local!
There are a huge amount of companies that offer warranty repairs but have seen a consistent instances where the warranties were a completely impossible or insanely complicated to apply to RV owners needs.
Which leads me to a suspect a nation wide warranty scam is ruining the RV community?
I have exhaustive research and have come up with ZERO application for any warranty contract that has not been a quagmire in a mud pit!
Tell me ...DOES ANYONE HAVE A POSITIVE RELATIONSHIP WITH WARRANTY COMPANIES?

The ONLY two reasons to have ANY insurance are A) to replace your income for yourself or for those who depended on you in the event of your untimely demise or disability, and 2) if you could not pay for a loss/damage/sickness out of pocket. Obviously most people could not pay for an extended illness requiring hospitalization, but many can afford car or RV repair. So many people believe these TV commercials about how great an extended car warranty is. What they don't think about is how much money they would save if they would just put that $200/mo premium in a savings account.

 

[Wilsonb3coe]

I have to say RV Extended Warranties are a scam. I know they say, oh but you really should have a warranty on your rig because insurance only pays if you are damaged, let's just say if it is in an accident. My husband and I will never purchase another Extended Warranty again. We might as well have just saved up the money in savings for things to be worked on. We purchased ours through the dealership that we purchased the 45ft class A that was on consignment. We figured, just in case, well that was a mistake. We purchased a 2011 Essex by Newmar and come to find out the prior owner did absolutely NO maintenance. He must have had it parked down in FL as it had FL plates on it but we purchased it from a dealership in Washington State. Big difference in weather!!! We have already forked over approx. $65,000 - $85,000 out of our own pocket, on top of the purchase price because AGWS did not want to pay for squat. All three of our AC's went out at the same time in AZ's triple digit weather, and they would not pay to replace them. I don't believe the third party individual they had come and do the inspection was honest. Want a good laugh? The female on the other end of the phone, from AGWS, said it just needed filled with more freon. We ended up in and out of our rig and truck to cool down, with our animals, until we had to pay out of pocket because no hotels in AZ would allow us with our 4 animals, even though they were 2 certified ESA's and 2 Certified Service animals. We were in such a pickle that we just paid it and had them do it right away. We did finally find a hotel in AZ that would take us but we had to register for 2 rooms. That is the only way they would do it. And you guessed it, NOPE, AGWS did not pay for the hotel either. Needless to say with all our issues, we didn't even come close to receiving the $17,500 we paid for the extended warranty. I truly believe they are companies that are just making money and don't want to cover a thing. When an extended warranty brings you to tears because they won't cover something so obvious, but there is 1-3 words missing in the contract that it doesn't cover, make sure to read the contract really good before you agree to anything. Ok, off my soap box because I could say worse but trying to keep it clean.

 

[Bearcatrp]

You should check with your state attorney general. Every state has some kind of help on matters like your extended warranty.

 

[Wilsonb3coe]

Thank you Bearcatrp. I will check into that because I didn't even think of the state attorney general.

 

[Kirk]

Like any type of insurance, some companies are good while others are not. But you will need to show where they violated the contract that you signed.

 

[Gary RV_Wizard]

All three of our AC's went out at the same time in AZ's triple digit weather, and they would not pay to replace them. I don't believe the third party individual they had come and do the inspection was honest. Want a good laugh? The female on the other end of the phone, from AGWS, said it just needed filled with more freon.

That repair insurance policy may have had a clause for depreciation and they determined your 2011 vintage a/c units had reached "end of life". Few buyers take the time to actually read all the fine print in the contract or know to ask specific questions like that, so they feel cheated. I ran into that on a failed windshield wiper motor - the insurer's depreciation table said a wiper motor only has a service life of 5 years. Preposterous, but they had it in writing and I only had hearsay from mechanics who said it's more like 15-20 years. It simply wasn't worth my time & effort to get documented counter-proof.

So is it a scam if you assumed the insurance would be generous but it turned out to be full of no-pay clauses that the sales person didn't explain in detail? Or was it just caveat emptor?

 

[Derby6]

It’s simply piece of mind. Just like insurance—Sometimes it pays off. Sometimes it doesn’t.
To date I haven’t got my money out of my warranty. And too be honest I hope I don’t—that means nothing big broke.
If something big does break. I’ll be glad I got it.

 

[Gary RV_Wizard]

The "scam" is on the sales side, with fearsome tales of hugely expensive RV repairs coupled with the implied benefit of never having to pay for repairs. Both are vastly overstated. The selling agents commission is large, so the sales agent is highly motivated to win you over.