Typically, when you buy a car or truck, there is more involved than just purchasing the vehicle. In many cases, you’ll get the option to buy extras. A critical addition is a vehicle service contract. Read on to learn about this contract and 10 common things that can void your vehicle service contract.
What Is a Vehicle Service Contract?
A vehicle service contract is a plan, paid by the buyer, that is issued when you purchase a new or used vehicle. It can be issued by a vehicle manufacturer, an independent third-party company, and so on.
The contract will cover some defects and repairs and can also include routine maintenance. When the contract expires, the vehicle owner is responsible for 100% of any repairs needed on the vehicle.
Vehicle service contracts typically last for a specific amount of time or a particular number of miles, and the contract cost (typically paid once a month) will vary. Such a contract is not indefinite or for the life of the vehicle.
This is because a vehicle depreciates as soon as you drive it. Depreciation is what your vehicle is worth when you bought it compared to what it is worth when you sell it. In almost all cases, your vehicle will be worth less when you sell it due to wear and tear, miles, etc.
A vehicle service contract from a reputable dealer or company is an excellent thing to buy. It’s designed to help your vehicle stay in as good condition as possible in those early years. However, such contracts can be voided if the rules are not followed. Read on to find out some common causes for a void contract.
1. Salvage Title
If a vehicle has a “salvage title,” it means that the vehicle has endured some significant damage in its past. Salvage title vehicles can be affordable; however, you need to balance the savings with the fact that the vehicle has endured significant damage in its past. If your vehicle has a salvage title, any vehicle service contract you purchase would likely be void.
If you buy a certified pre-owned car, truck, etc., your contract won’t be voided. However, suppose you’re buying from a source such as an independent used auto lot. In that case, you need to be aware of what you’re buying: use a vehicle history report or something similar. Such a report will inform you if the vehicle you’re interested in is a salvage title.
2. Environmental Damage
Sometimes unfortunate damage is caused to your vehicle by severe environmental factors such as a fire, an earthquake, or a flood. If such damage occurs to your vehicle, your vehicle service contract won’t cover it.
3. Misusing Your Vehicle
This one is not as concrete, but the individual contracts determine it. Basically, misuse is anything that can be deemed outside of the normal operations of the vehicle. For example, if you race an SUV as if it were a hot rod, that could end up voiding the contract because you’d be putting unnecessary wear and tear on the vehicle.
4. Low Fluid
The contract’s issuer may void the vehicle service contract if the vehicle’s fluid is kept low. This can happen even if needed repairs were the cause of the low fluid.
5. Insufficient Record Keeping
Keeping your vehicle maintained is a good thing, but did you save the documentation and receipts? Many vehicle service contracts require documentation and receipts to prove your claims. If you don’t have this paperwork, your claim may be denied.
6. Theft or Vandalism
What happens if you park your vehicle in front of your home at night, but when you wake up the next morning, your car is gone, and you discover that it was stolen? Will your vehicle service contract cover theft or vandalism? The answer is no. Theft and vandalism of a vehicle are typically covered by your car insurance, depending on the kind of car insurance you have.
7. Not Keeping Up with Maintenance
It’s important for you to keep your car in good condition, whether you have a vehicle service contract or not. That means that you need to keep up with things like oil changes, alignments, and filter changes. Despite your responsibility as a car owner, normal maintenance tasks are not covered under a vehicle service contract.
8. Modifications That Are Custom
You are free to modify your vehicle with custom modifications, and that won’t harm your warranty. However, if a modification causes damage to a part covered under warranty, your claim could be denied.
To avoid this, always have your vehicle modified by a professional. An expert will know how to modify without causing damage to the existing structure.
9. Tampering with the Odometer
A vehicle’s odometer measures the exact distance a vehicle travels. It can typically be found located at the dashboard of a vehicle. In a car, for example, the odometer lets you and a manufacturer know how old your car is and how much it’s been used.
A car with low mileage, compared to a car with high mileage, has a higher resale value. Changing the odometer to reflect a lower mileage is an act of fraud and will void your vehicle’s service contract.
10. Road Salt
It is typical for crews to spread salt on roads during cold winter months. The purpose of road salt is to reduce the ice on the road. More specifically, the chemicals in road salt turn ice back into the water, allowing vehicles to reach the pavement and regain traction.
Vehicles owned by owners who live in cold climates typically drive in salty conditions during the colder months. Unfortunately, this ice is corrosive to cars over time, and concerning vehicle service contracts, such damage is almost never covered. During the winter months, make sure to clean your car regularly to reduce the likelihood of corrosion.
A Vehicle Service Contract and a Car Warranty
We need to note that the term “vehicle service contract” is sometimes called a “car warranty” or “extended car warranty.” However, the two are not always the same.
Oftentimes, there are differences between a vehicle service contract and a car warranty. While service contracts can cover the same aspects as a warranty, it’s important to know which one you have and what is covered.
Take Care of Your Vehicle
The examples above are not an exhaustive list. Other issues can arise that can void your vehicle service contract.
To avoid these issues and others, there are two specific things you can do:
1. Thoroughly read your contract, including the “fine print.” Make sure you understand it and know what’s not covered.
2. Ensure that you’re getting your vehicle regularly serviced, especially as recommended by the manufacturer.
Your vehicle service contract can be helpful. Pay attention to the agreement rules, and you’ll have a better chance of keeping your vehicle in great shape.