Last updated February 25, 2020 by John Goreham
What is CARCHEX?
CARCHEX is one of the larger, more highly-rated providers of vehicle extended warranties and has been in business for 20 years. Here, we’ll summarize the company’s reviews and help you be a smart shopper.
The first thing to know is that CARCHEX is the front door to many car warranty providers. If you look closely at the CARCHEX site, you will see that the products CARCHEX offers are listed as, for example, “CARCHEX Care by AAS,” “American Auto Shield,” “Royal Administration Services,” and other names. We were not sure what to make of this, so we phoned CARCHEX. The representative confirmed that CARCHEX acts as a “broker,” and that depending upon your specific vehicle, one or more “administrators” would be available as policy options. CARCHEX would then choose the best one for your needs from one of the 20 separate options in one of the five tiers of coverage. CARCHEX’s representative confirmed that it is not actually CARCHEX who will pay the cost of your repair, but rather the administrator company. By comparison to purchasing an extended warranty directly from the manufacturer of your vehicle, this seems overly complicated to us.
What is covered in a CARCHEX warranty?
Rather than answer what is covered, a better question might be, “what do you wish to be covered?” With five separate tiers of coverage, CARCHEX can broker a policy for you that will be very basic, covering just major drivetrain components, to one that is comprehensive and covers the vehicle in the same way that a new car warranty does. What we don’t like about the options is that there are five levels of coverage.
We phoned CARCHEX and used the menu tree on the phone to find a customer service agent. It took 49 seconds to be connected. We asked, “If a customer purchases the top tier, Titanium, is the infotainment system covered?” The answer was a qualified “yes.” The agent told us that “With some policies, luxury electronics are covered as part of the policy, and for some vehicles and some policies a policy rider is added.” This concerned us for two reasons. First, every new vehicle sold today comes with an infotainment system. It is no longer a “luxury electronics package.” Second, if that major vehicle system is not part of the top tier policy in every case, why isn’t it?
Car Talk could endeavor to recreate the broad list of offerings that CARCHEX can provide, but the services offered to depend on your specific vehicle. The list of 20 different policy options plus additional riders to the policy would make such a chart meaningless. You have to call CARCHEX and speak to an agent to find out what the company has for offerings for your vehicle. Or you can use the CARCHEX configurator online to narrow the selection for your specific vehicle.
In addition to the repair services that CARCHEX offers, its policies can also include many of the services that AAA offers such as towing, roadside assistance, and temporary replacement rental vehicles. That could add up to a value of about $50 per year. However, it will be pinned to your vehicle. AAA coverage is not. It works with any vehicle in which you ride.
When you purchase your CARCHEX-brokered policy, be sure to note the exclusion time. Typically, vehicle extended warranties have a period of about 30 days and 1,000 miles after you purchase the policy, during which you are not yet covered. There may also be a vehicle inspection required before you are covered.
How do I get the best price on a CARCHEX warranty?
Your best bet is to start by contacting CARCHEX to understand the warranty prices and options. The site has a “free instant quote” tool. Keep in mind that any time you work through a car dealer to get an extended warranty, the dealership salesperson has his or her own incentive to get you to buy the warranty. You may not receive the most accurate information about the warranty options and pricing unless you get the information directly from the warranty provider, such as CARCHEX.
If you have received an extended quote from a dealer, it makes good sense to cross-shop the price they provided you with against CARCHEX. Make sure you get a detailed list of what is - and isn’t - covered by the dealer’s warranty plan. To get the best deal, you will need to do an apples-to-apples comparison with CARCHEX.
Questions you should ask before getting a CARCHEX extended warranty
Can I Trust CARCHEX?
The simple answer is, “yes.” CARCHEX is a legitimate business with many third-party certifications and state registrations. While there are many car warranty companies with a less robust history, CARCHEX has been an accredited member of the Better Business Bureau (BBB) for 20 years. The company’s current BBB rating is A+.
The longer answer is more complicated. A scan of the reviews reveals a long list of CARCHEX policyholders who feel as if they were not provided the services they were promised. In our view, this is a reminder that you need to read the fine print. Make sure you fully understand what is and is not covered in your plan.
Can I Change My Mind After I Buy A CARCHEX Warranty?
Yes, you can change your mind if you purchase a CARCHEX-brokered warranty and then decide that you don’t want it. The company offers a 30-day money-back guarantee and also a pro-rated refund program for those who opt to end the coverage early. Be sure you see both options written in your contract before you sign.
Where Can I Read CARCHEX Reviews?
There are many places at which you can read reviews from owners of CARCHEX-brokered warranties. The reviews are mixed. That should not be a surprise. The automotive repair business is always a bit fuzzy and folks who are using a CARCHEX warranty have had something go wrong with the vehicle they love. Their review may be a reflection of the experience they had with the repair shop as much as it is the CARCHEX warranty.
The Better Business Bureau (BBB) allows users to post reviews about CARCHEX, as they do with other businesses. These show the company earning an average rating of a 2-out-of-5 score with 69 reviews posted. The reviews at BBB for CARCHEX seem to be polarized around the top score of “5” and the bottom score of “1”. The negative reviews mostly stem from descriptions of poor customer service to repair items that CARCHEX did not cover whereas the customer expected they would be. We are not surprised to see this, as you would expect that people who are disappointed are more likely to post reviews on a website such as BBB. In fact, the BBB review profile for CARCHEX is consistent with what we see for other car warranty companies.
Yelp reviewers give CARCHEX a 3-out-of-5 score on average. Again, many of the reviews are either 1s or 5s. Interestingly, CARCHEX takes a very active role in answering the negative reviews. One thing that becomes clear from the CARCHEX online helper (Jason) is that the shop you take your car to does not deal directly with CARCHEX. It works with the administrator. CARCHEX is a middle-man who helps with sales and customer-facing service.
There are many other consumer-related websites that rate CARCHEX higher. However, Car Talk has no way to know if those sites are offering paid advertorial reviews with screened reviews or if they are truly independent.
Neither Consumer Reports nor Google offers public CARCHEX reviews. Both are our usual first places to look for independent opinions.
Alternatives to CARCHEX
When Buying New
One of the best options to CARCHEX to consider is an extended warranty purchased directly from the automaker who built your vehicle. All automakers offer extended contracts. Be certain the one you are buying comes from the manufacturer. For example, if you buy a Lexus, the contract should be with Lexus or its Lexus financial services company.
There are three important things to remember about contracts you purchase from the manufacturer of your vehicle. First, you don’t have to buy it the day you purchase your new or pre-owned vehicle. You can purchase an extended warranty from most automakers any time during the comprehensive portion of the new vehicle warranty. In other words, you just need to buy it before the included warranty expires.
Second, buying an extended warranty from the manufacturer of your vehicle need not be done at the same dealership at which you purchase the vehicle. Any dealer of that brand can sell you the contract and you can shop prices by phone to ensure you get the best deal.
Third, like CARCHEX, the warranty can usually be canceled for a pro-rated refund if you opt to sell the car before your warranty term is up. Most of the warranties can also be transferred for a small fee to the new owner.
Another option if you are buying new, but have not yet signed on the dotted line, is to consider buying a vehicle from one of the many manufacturers that have unusually long warranties. Genesis, Hyundai, and Kia, for example, have warranties included in the car’s price that can last as long as ten years. Volkswagen and Jaguar also have unusually long warranty periods compared to their competitors. If you are worried about future repair costs of your new car four, five, or even nine years down the road, why not simply buy a car that has a standard warranty lasting that long?
When Buying Used
Another option to consider instead of buying used and then adding a CARCHEX warranty to protect you from unexpected repairs over a set period of time is simply to purchase a certified pre-owned (CPO) vehicle from a manufacturer. CPO cars, as they are called, come with an extended warranty backed by the manufacturer that protects you after the car’s included warranty expires. Some CPO programs allow a private seller to transfer the warranty to a new owner. Be sure you verify that if you are buying a CPO vehicle from a private party.
When You Already Own The Car And Want To Sleep Better At Night
If you already have a used car out of the manufacturer’s warranty period, and you are worried that your vehicle may need expensive repairs, there are ways to tell if your vehicle is likely to need them compared to other similar vehicles. CarComplaints.com allows you to look up your exact year, make and model and see if that vehicle is a troubled one or if it is relatively reliable. It costs you nothing. Consumer Reports also has a great vehicle reliable history by year make and model and is available to subscribers (about $40 per year). We know the staff at both CarComplaints.com and Consumer Reports and can attest to the organizations’ fierce independence. Last, you can ask your trusted mechanic to evaluate your vehicle and let you know if it is a model known for breakdowns of a specific type of failure.
Purchasing an extended warranty on a vehicle is an important decision. We hope we have provided Car Talk readers with a detailed and helpful guide to the services CARCHEX provides.
About Extended Warranties For Your Vehicle
One of the most common questions we receive in the Car Talk Community is, “Do I need an extended warranty?” It’s no accident that this is a frequent topic. New and used car dealers plant that seed of doubt in the buyer’s mind as soon as the ink is dry on their vehicle purchase.
Extended warranties are big business in America. WarrantyWeek estimates that the automotive extended warranty business in America is valued at $15 billion per year. Both new and used car dealers profit from the sale of the contracts and count on the sale of these warranties to meet their profit targets. They even employ specific salespeople to sell them to you known as “after-sales” managers.
Extended warranties pick up where your vehicle’s included warranty ends. The average price is in the range of $1,300 to $1,500 and they generally cover repairs on your vehicle for a set period of time. Not maintenance - those are separate agreements not discussed in this story. Extended warranties also only cover a specific list of possible problems. Most have deductibles you will pay each time a repair is needed as well. The many options can be confusing. Be sure you know exactly what you are purchasing before you sign on the dotted line.
Will you need a vehicle extended warranty? A 2014 survey by Consumer Reports determined that 55% of its members who had owned a policy never used it once.
Editor's note and disclaimer: Car Talk is supported by our fans, readers, and listeners. When you click on some of the links on our website, we may receive referral compensation. However, you should know that the recommendations we make are based on our independent editorial review and analyses.