Extended warranties and service contracts

When you buy a car, appliance or other product, the retailer may offer you some sort of service contract or protection plan.

Review the contract and what it covers

Read the contract to make sure you're getting what you think you are buying.
Are you duplicating coverage you get for free with a product's regular manufacturer's warranty?
When does the coverage take effect? How long does it last?
What is covered? What's excluded? For example, even "bumper-to-bumper" auto coverage almost always includes limitations and exclusions.
If you buy the contract, be sure to get — and keep — your receipt and a copy of the contract.

Don't be afraid to ask for a better price. The majority of the sales price for many extended warranties and service contracts is the seller's profit.

Under state law, if you buy an auto service contract and make no claims, you can get a refund if you return it to the contract seller as follows:

How refunds and cancellation fees work for auto service contracts
Time from the date of purchase	Refund	Cancellation fee
Within 9 calendar days	Full refund	No cancellation fee
Within 10-30 calendar days	Full refund	Contract seller can charge you a cancellation fee of no more than $25
After 30 calendar days	Refund is prorated against time remaining in the service contract or mileage calculated — depending on your contract's details.	Contract seller can charge you a cancellation fee of no more than $25