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Old 07-12-2019, 06:51 PM
hogwldfltr hogwldfltr is offline
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Location: Da Island, MA
Join Date: Jun 2019
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Originally Posted by Autoputzer View Post
Doug's right... sort of On average, warranty premiums cost more than warranty claims.

Anytime there's a discussion on extended warranties people post how they've saved money by having one. I believe them. But, they are not a representative sample of those who have bought extended warranties. People are less likely to post "I spent $4k on an extended warranty and have nothing to show for it."

BMW's extended warranties have an inherent advantage, in that they provide the parts and they get a discount on the tech's labor at dealerships.

Insurance is best suited for those losses that would wipe you out: destruction of a house, $1M in medical bills, dying early and leaving dependents, causing a traffic accident that kills 20 people, etc.
I agree with the odds being that the payout from the policy is likely to be less than the cost of the policy. I'm certain the companies that sell the policies had statistics and use them to their advantage. The rest of us can only research the likelihood of failures on the net and look for trends reported on due to major issues.
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