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|Setting the standard for
Pre-purchase RV Inspections
Types of extended warranties:
Exclusionary Policy - Exclusionary policies only list items which are NOT covered by the policy. These policies are more expensive, more
comprehensive and easier to understand. This type of coverage includes every mechanical aspect of your RV except those items specifically excluded from
coverage. Exclusionary contracts can vary in levels of coverage and cost based on the specific items excluded in the contract. The more items excluded, the
less the cost. Take time to understand what is specifically excluded to make sure you get the coverage desired.
Inclusionary Policy - Inclusionary policies are the most common policy type. They only cover the specific items listed in the contract. An item is not
covered if it is NOT listed in the contract. The major issue with this policy is due to the complexity of various components in the RV. Your claim may be
denied if a repair is for an item you did not know existed and is not listed in the policy. These policies tend to be less expensive than exclusionary policies.
Key Coverage Considerations
Consequential Damage –
Consequential damage occurs if a component not covered by the policy causes damage to a component that is covered by the policy or vice verse. Unless
you have consequential damage coverage, the warranty company can legally deny your claim for repair for one item damaged by another that is not covered.
Understand the consequential damage covered in the policy.
Make sure you know the deductible and whether it is a "per visit" or "per item" deductible. Make sure that you only pay one deductible per repair facility visit.
Higher deductibles will reduce overall cost of the extended warranty.
Payment Of Claims –
Be sure that the warranty Administrator pays the repair facility directly. You do not want to have to pay the repair facility out-of-pocket and then submit
receipts for reimbursement. Be cautious of repair facilities that won't work with warranty companies.
The ability to transfer your extended warranty with the sale of your RV is desirable. There may be a small transfer fee, but a transferrable warranty may
provide leverage for the sale of your RV.
Understand the terms and conditions for policy cancellation. When do you have to cancel to get a full refund? What is the refund policy after the initial
"probation" period? Many extended warranties will give a pro-rated refund based on the time remaining on the policy if you cancel.
Most warranties will deny claims if you do not follow specifically stated maintenance guidelines or do not properly maintain and repair the unit covered. You
will need to keep your maintenance records and receipts to prove compliance to warranty restrictions and obligations.
Processing Claims -
Understand the proper procedure to make a claim. Extended warranty companies require the damage be assessed prior to approval of the repair. This
may require review of the repair estimate or an inspection by an authorized inspector. Based on their review, the warranty company may only approve a
certain labor rate and number of hours for the repair. This repair allowance may be negotiated based on your specific circumstances, but having current,
complete maintenance records will be important in negotiating the repair authorization. Regardless of the process, be sure that repairs are approved
before work begins. Most extended service contracts have an exception to the "Pre-authorization rule" for emergency repairs. The exception is very specific,
so be sure you understand the emergency repairs provisions before repairs are made.
Contract Protection -
It is important to purchase a warranty backed by underwriters with A.M. Best “A” ratings "Risk Retention Groups" are not regulated as well as insurance
companies and could go out of business leaving you without coverage. Know who backs your policy.
Service After You Buy Your Warranty –
A quality Contract Provider will offer you after-the-sale service. They will be your point of contact for repair and can serve as a mediator to resolve any repair
Suspicious Claims -
Claims made immediately after warranty purchase will automatically be under suspicion. Some contracts have short "waiting periods" before a claim can
be filed. An inspector may be sent to inspect early claims to make sure it wasn't a pre-existing condition.
Policy Cost is Based on Where You Purchase the Policy
Dealer-sold warranties are typically more expensive and less comprehensive than a warranty you can get from other sources. Shop around to find the best
policy to meet your specific coverage needs.
Does the warranty Administrator require an inspection of your RV before the policy is issued to identify any "pre-existing" conditions? Pre-existing
conditions are not covered, so the inspection may prevent a claim denial later. Inspections are more likely if you have an older RV or are not currently
covered by a warranty at the time you apply for the extended warranty.
Additional Benefits –
Some extended warranties offer additional limited coverage. Towing, roadside service, emergency repair, lodging and trip interruption reimbursements
may be included in the policy. Understand the limits and additional cost of this coverage.
Repair Center Restrictions –
Claims may be restricted or deductibles may be increased based on the repair facility selected. Know your policies limitations for “at home” and “on the
Who is Underwriting the Warranty –
Purchase from the actual people that will assist you with your warranty and claims issues. Be sure the claims company you use is a reputable one and the
underwriter is a solid, A.M. Best A-rated insurance firm.
Check Reputation –
Check the internet and call some RV repair facilities and ask them if they’ve worked with the company. What the claims process was like? Does the
company have a good reputation.
Check On Full-Time RV Coverage –
Is the policy valid for full-time use of the RV. Some are not, or may cost more for full-time use.
Understand Policy Limits –
If you’re getting a 50,000 mile policy does it start from current mileage, from the day you purchased your RV or the date of manufacture?
|About Extended Warranties