BBB: Deceptive Auto-Warranty Solicitations Plague Consumers Nationwide

February 15, 2009
The Better Business Bureau has seen a considerable spike in both complaints and inquiries from consumers who state that they received misleading mailers or high-pressure telemarketing calls claiming their auto warranty was about to expire. In 2008, more than 140,000 consumers contacted the BBB to confirm the legitimacy of companies selling auto warranties.

Consumers report that the calls and mailers include a pitch to purchase an extended auto service contract of questionable value.

With this latest onslaught of solicitations, consumers say they were told they needed to take immediate action in order to avoid a lapse in warranty coverage. BBB research shows that the consumer is actually being sold an extended-service contract that is not associated with the car manufacturer’s warranty.

The value of these extended-service contracts has been called into question because they include numerous conditions that might be difficult to meet. For instance, pre-existing conditions often are not covered, proof of maintenance records may be required, and restrictions on authorized repair facilities and repair charges must receive prior approval.  Others report difficulty in obtaining refunds.

Your BBB offers the following advice in dealing with a firm selling extended auto service contracts:
  • Never give personal information, including Social Security, bank or credit card numbers, over the phone to an unknown telemarketer.
  • When considering an extended-service contract or any other type of telephone solicitation, insist on getting a written contract in which all terms and conditions are clearly explained before signing up or providing credit card or other payment information.
  • Read your auto manufacturer’s warranty and contact your dealer or manufacturer so that you are not purchasing duplicate coverage.
  • Before purchasing extended warranty coverage, check out the company
    first with BBB at

Consumers can place their phone number on the federal do not call list by visiting If you’re already on the list but continue to receive telemarketing calls, use the same Web site to report the incident to the FTC.

Start With Trust. For more reliable information on avoiding fraud and identity theft, go to or call 470-484-1348 or 800-564-0371.