Extended car warranties: Proceed with caution

PITTSBURGH — Robocalls for extended car warranties have become a daily source of frustration for many consumers. As annoying as they can be, the constant barrage of calls, commercials and email solicitations are working to get some consumers to buy.

For example, Mount Lebanon resident Bob Wagner decided to buy a CarShield extended auto warranty when he purchased a used 2012 Hyundai Veloster last May.

“I heard it being endorsed by a lot of celebrities, heard it on the radio, TV, got mail on it, so I decided to give them a call,” Wagner said.

Bob, like so many others, was looking for peace of mind to help protect against a major expense if his car broke down. He paid $130 a month for the Powertrain Gold policy, which lists “engine” as the first item covered.

“It covered all the big stuff—the engine, transmission, all the electrical components,” he said. “That’s all I was really worried about was having a big bill come across.”

Hiccup on the Highway

Everything was going fine until about six months later when he was driving on I-79.

“All-of-a-sudden the car was just-- almost like a hiccup! Then, all-of-a-sudden, it was like I didn’t have too much power.”

He ended up having the car towed to South Hills Cochran Hyundai, and they diagnosed the problem.

“They looked at it and told me what the issue was real quick. They said, ‘Bob, the engine needs replaced.’”

Bob put in a claim with CarShield, but then the wait began to get the repair authorized.

He drove a rental car for months, racking up thousands of dollars in bills as he kept trying to get a response on his claim. Despite dozens of calls to the company, five months later his car was still sitting at the Hyundai dealer with no authorization to do the repair.

“It’s been like hell!” he said. “The run-around, they’re pros at it!”

That’s when he called 11 Investigates. Bob says he wanted to tell his story to warn others.

“I don’t want it to happen to anybody else.”

Proceed with Caution

Unfortunately, when it comes to after-market extended car warranties, Bob isn’t alone. Having a claim denied is a frustrating reality for many consumers.

ATC Auto Repairs in Pittsburgh has experience dealing with several after-market car warranty companies.

“It’s always a hassle going back and forth between what can be covered and what will be covered or what won’t be covered, there’s never a solid answer,” said ATC Technician Dave Anderson. “It’s just a three-way circus between us, the customer, and them. It’s never easy.”

Lemon law firm Kimmel and Silverman also warns that consumers should tread carefully when looking to buy an extended car warranty.

“You need to understand it’s a gamble, and there is a risk, and you really need to do your due diligence,” said Michael Sacks, Kimmel and Silverman Communications Director.

Sacks says the firm recommends that consumers stick with manufacturer extended warranties and avoid after-market warranties from third-party companies.

He says manufacturer extended warranties offer more protection under federal law if something goes wrong.

“If you have a manufacturer’s warranty original extended or powertrain warranty, and you’re back three or more times for the same issue, or your vehicle is out of service an extended period of time— months dealing with an issue, then you might have the right to secure compensation to reflect the diminished value of your vehicle,” he explained.

Check for online complaints

One important step whenever buying a warranty is to check for online complaints against the company you’re considering.

A quick check of CarShield’s record with the Better Business Bureau shows the company has an “F” rating and an alert for a pattern of complaints.

In Bob’s case with CarShield, five months later he finally got an answer on his claim. It was denied.

“I just can’t believe they can treat people like this,” he said to 11 Investigates, frustrated by the whole process.

Sacks reviewed Bob’s case and said, unfortunately, he was in a tough spot.

“There is not a clear-cut road to recovery in this particular situation. He is stuck,” Sacks said.

But Sacks added the company might be inclined to respond to a media inquiry from 11 Investigates.

“They may respond to Angie!” he said.

Do you have a story you’d like for Target 11 to investigate? Submit a tip here.

11 Investigates gets action

11 Investigates called and emailed CarShield to inquire about Bob’s case and find out why they denied his claim, since the engine issue appeared to be covered by the Powertrain Gold policy.

After asking Channel 11 for details on Bob’s claim, the company said they would get back to us.

The next day, 11 Investigates was there when Bob got a call from the Claims Director for American Auto Shield, the company that handles claims for CarShield. He wanted to know what they could do to resolve the issue.

“I was quite happy, so thank you, Angie!” Bob said, laughing after he got off the phone.

While Bob did get a resolution with the help of 11 Investigates, it didn’t erase the problems he experienced before we contacted the company.

After settling with Bob, American Auto Shield refused to answer any questions about denying customer claims and delays in providing coverage. The company said only, “this has been resolved” and they would “not have any further comment.”

How to protect yourself

Whenever you purchase a warranty, especially an after-market extended car warranty, it’s important to understand the terms of the contract for any exclusions and requirements.

For example, in many contracts, regular maintenance on the vehicle is required, whether it’s an after-market or manufacturer warranty.

  • If you miss even one oil change, it can void your warranty.
  • It’s important to keep receipts for all maintenance to prove you had the work done.

CLICK HERE for more advice from the Federal Trade Commission on buying extended car warranties, which were the top call complaint filed by consumers in 2020.

When it comes to after-market extended car warranties, Bob says he learned a hard lesson.

“Buyer beware,” he said.

How to stop ROBOCALLS

Here are several steps you can take to help stop robocalls:

  • Don’t answer calls from numbers you don’t know, if possible. (Once you answer, it lets the spammers know this is a real person and leads to even more calls.)
  • If you do answer, don’t respond to any questions asked by saying “yes” or pressing any numbers. (Again, it’s a trick to confirm you are a real person and can lead to more robocalls. For example, when they say, “Press 5 to be put on our Do Not Call list” — don’t do it. Just hang up.
  • Download a robocall blocking app, like Robokiller, Nomorobo or Hiya.
  • Both Apple iPhones and Google Androids have features you can activate to help screen spam calls.
  • Register for the Do Not Call list by calling 1-888-382-1222 or sign up at donotcall.gov/
  • File a complaint with the FTC