A guide to car warranties in the UK

Having a car warranty gives you peace of mind that if your car breaks down due to a mechanical issue or other fault, you’ll be covered for the cost of repairs. This is particularly useful if something goes wrong that wouldn’t be covered by your car insurance. You can get a car warranty for both new and used cars, so whether you’ve just bought it or have had it for a while, you can get your vehicle covered for costly fixes.

A car warranty covers you against the cost of dealing with mechanical or electrical faults with your car during a set period. These problems can be expensive to fix, so a car warranty is often a valuable – and cheaper – alternative to paying out of your pocket for a garage to deal with the issue.

Car warranties come in three main types: 

New car warranty

When you buy a brand-new car, it’ll come with a vehicle manufacturer’s warranty, which will typically cover the car for three years. Some manufacturers offer a car warranty covering five or even seven years. Alternatively, you may find the car warranty covers your vehicle up to a certain mileage limit and time limit; for example, 60,000 miles over three years is typical.

Used car warranty

Car warranty isn’t only issued by the car manufacturer on new cars – you can also buy it separately from an insurance company or a used car dealership. This is how you’ll often get a car warranty for a previously owned car.

When you buy a used vehicle, it may still be under a manufacturer’s warranty, meaning it has months or even years left on its policy from when it was first sold, which is still valid for you.

Extended warranty

An extended car warranty does what it says – it extends the car’s warranty after its current warranty expires.

You can buy an extended car warranty from the car manufacturer, car dealership, or an insurance company. An extended car warranty will usually just carry over the same level of cover as the previous policy.

A car warranty in the UK will mainly cover parts and labour to fix problems caused by electrical or mechanical failure of components, such as the fuel pump, radiator or engine.

Some policies will also provide roadside assistance, recovery and a homestart service.

Car warranty will typically not cover parts that have failed due to wear and tear, such as batteries, tyres or windscreen wipers.

Coverage details can vary significantly between different car warranty providers and individual policies. Make sure you read the terms of any policy you’re considering carefully to know exactly what is included and ensure it meets your needs.

The cost of a car warranty will depend on the type of car you have, how long you’ve had it, how much you drive it and how much cover you’re looking for. The price of a car warranty also varies by warranty company, so it’s worth shopping around.

Typical factors that can affect the cost of a car warranty include:

• Vehicle mileage: Car warranty companies assume the higher your mileage, the greater the likelihood something will go wrong with your vehicle, increasing the price of a car warranty.
• Make and model: Based on data from 2021, the Automobile Association (AA) provides examples of the cost of a 12-month extended warranty on its website for a range of different makes and models of used cars, including:
  • Audi: The average extended car warranty price quoted was £538, with the lowest price quoted at £277
  • BMW: The average was £524, with the lowest at £276. 
  • Nissan: The average was £429, with the lowest at £276.
• Vehicle age: Car warranty companies expect older cars to have more issues, so a warranty is typically more expensive.
• Duration of cover: The longer the cover period for your extended car warranty, the more it will cost. But if you plan to hold on to your car for a number of years, the peace of mind could be worth it. The maximum length of cover is usually about seven years.

Yes, you can get a used car warranty. A used car warranty will cover the cost of parts and labour to fix certain components if they fail within a timeframe.

There are two main types of used car warranty, depending on whether you bought the second-hand car from a dealership or a private seller.

1. Getting a used car warranty from a car dealer

The Consumer Rights Act (CRA) provides a statutory warranty for used and new vehicles bought from a dealer. Under the CRA, a used car must be in good working order and fit for purpose when the dealer sells it.

Under the CRA, if a used vehicle develops a fault within the first 30 days of buying it, you can return it to the dealer and get a full refund.

You can also return the used car up to six months from the date you bought it if you find any fault, as the CRA presumes the fault was present at the time of purchase. The dealership gets one opportunity to fix the issue – if it can’t, you’re entitled to a refund.

The CRA doesn’t cover wear-and-tear damage.

Used car dealerships typically offer their own warranties, known as approved used car warranties, which usually last six to 12 months. These warranties may be included in the price of the car or as an optional additional fee. Note that they often require you to get your vehicle serviced and repaired at the dealership.

2. Getting a used car warranty from a private seller

It’s possible to get an aftermarket used car warranty, sometimes called an extended warranty, for a used car you buy from a private seller.

Car warranties for used cars often have a limit on the age of the car. A car age limit of 10 years for a used car warranty is possible, sometimes stretching to 12 years. The mileage limit is usually 150,000 miles or less. The older the car and the higher the mileage, the more expensive the policy will be.

Car warranties vary in their terms and conditions. For example, most don’t cover general wear and tear, but the Halfords car warranty does. Policies from the best car warranty companies will cover you if you experience a fault with your car while travelling in Europe, but not all do.

Make sure you check the small print on any car warranty deal so you know exactly what you’re paying for.

Things to consider include:

• Labour rates: Some car warranties impose limits on labour costs, with up to £200 per hour being fairly typical. The Royal Automobile Club (RAC) offers policies allowing labour costs of either £60 plus VAT or £100 plus VAT per hour, depending on the specific policy chosen.
• Cost of excess: Most car warranties will have an excess – the amount you’ll need to pay to get your car fixed before the warranty kicks in. The excess is usually a few hundred pounds, and typically, the lower it is, the higher the cost of the policy.
• Approved garages: Car warranties may include a list of garages approved to carry out work on your car under the warranty. If you go to a garage not on this list, you’ll likely have to pay for the fix out of pocket. However, some policies allow you to take your vehicle to any VAT-registered garage or repair centre. It’s a good idea to use a car garage approved by the Motor Industry Code of Practice for Service and Repair.
• Betterment of parts: Look out for a betterment clause, which means you may have to pay towards some of the cost of the parts or repair if the fix leaves your car in better condition and worth more than it was previously.
• Insured vs uninsured warranties: Under an insured warranty, you can claim compensation through the Financial Services Compensation Scheme (FSCS) if your insurer goes bust. There’s no such protection with an uninsured warranty.

Finding the best car warranty companies requires a bit of detailed research. It’s made easier with price comparison websites, such as MoneySuperMarket, Go.Compare and Compare the Market, which all compare extended car warranties by price and features.

To find the best car warranty for you, think about the following:

• Policy duration: Determine how long you plan to keep your vehicle, as this will influence the duration of the policy you choose
• Coverage level: Decide between basic coverage, which is more affordable, and a comprehensive policy that, while costlier, offers more protection
• Excess fees: Consider the excess fee structure; policies with lower excess fees tend to have higher premiums, and vice versa
• Travel clauses: Determine if the warranty offers European cover as a standard feature
• Extras: Explore the extras included in the policy, such as breakdown cover, provision for overnight stays and access to a hire car in case of car troubles

Remember to ask detailed questions if you’re purchasing an extended warranty from a car dealership. Find out what it covers and any restrictions that would invalidate the policy, such as only taking it back to the dealership for repairs or limits on the car’s age or mileage.