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2013 Mazda CX-5 (Mazda)
2013 Mazda CX-5 (Mazda)

Ask Joanne

Should I buy a third-party extended warranty for my car? Add to ...

I recently purchased a used 2013 Mazda CX-5 (GX Trim, 12,500 km). The car looks to be in great shape, and is a year into its three-year/80,000-km comprehensive warranty and five-year/100,000-km powertrain warranty. The dealer has offered an extended warranty to the tune of $1,656, which would lengthen the comprehensive warranty to 84-month/100,000 km (actually, 72 months since the car is a year old) as well as free oil changes for the life of the car. They suggest synthetic oil changes every four months or 8,000 kilometres, which usually cost approximately $100 each time. I asked the finance manager and he said that the warranty is offered through a third-party company. Thoughts as to if I should purchase it or not? I would generally say no to an extended warranty, but free oil changes do sweeten the deal. – Brandon in Edmonton

With free oil changes for the life of the vehicle, the extended warranty you’ve been offered is tempting. In six or seven years, you’ll have recouped the cost in oil changes alone.

You didn’t specify, but if you purchased the vehicle at a Mazda dealership, there may be a more affordable option in the form of an extended warranty from the manufacturer, rather than the third-party product you’ve been offered.

“Mazda has a certified program for their products. It’s certainly odd that a dealer would be promoting a non-Mazda warranty. The Mazda warranty is very cheap for the dealer when it’s Mazda certified.” says George Iny, director of the Automobile Protection Association (APA).

“And he [the customer] could save some money; it would cost less than $1,600, and he’d be getting a national guarantee, and national performance of his warranty at any Mazda dealer. And it might make the resale of the vehicle easier if he sells it before then. He won’t get the oil changes, but he’ll be a thousand dollars richer; it’s that much cheaper from what I understand,” says Iny.

In terms of reliability, a manufacturer’s warranty is typically preferable over one offered by a third party. However in Alberta, as with British Columbia and Saskatchewan, the sale of third-party extended warranties is regulated and companies offering them must be insured.

“These companies do occasionally go bust, but it’s much more rare in provinces where insurance is mandatory to have people coming in and out of the business. It’s not easy to get insurance and there is some oversight by the insurer,” says Iny.

As with any extended warranty, make sure it includes coverage of major components, beyond just the powertrain. “There are other parts for example in the air conditioning system, electronic parts, and anti-lock braking components that may fail that have quite a lot of value attached to them, and he’ll want to know that his back is covered,” says Iny.

According to the APA, which publishes the Lemon-Aid car buyer’s guides, extended warranties are a good idea if they cover items likely to break down within the warranty period.

“Mazda have had trouble with several new model launches, so on the CX-5 if you’re going to keep it longer than the basic warranty, it’s prudent to buy extra coverage. The CX-7, the Mazda3, there’s certain engines that have had quite severe problems. This is an all-new engine in the CX-5, it was new last year from the ground up, so I think it’s prudent for somebody to consider buying extra coverage. But, not an aftermarket product if the manufacturer offers something for much less, and also more complete coverage,” says Iny.

If the extended coverage you’re considering has a low (or no) deductible and is transferable to a future owner, then it seems to be a good deal. Before you sign, however, do find out if there’s a better deal from the manufacturer.

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