Anonymous asked in Cars & TransportationInsurance & Registration · 1 month ago

Will extended car warranty payout cash if its cheaper?

My engine in my car on my 2015 BMW 335i is damaged beyond repair, the repair is going to be $16k+ but I only paid $18k for the car, in this case the car is totalled so would the warranty ever just payout cash in a situation like this, or do they only cover the repair no matter the price. They are still investigating the cause of the mechanical problem.


They ended up just fixing it, by putting a used motor with 20k miles on it, the repair costs is about $12k paid by the warranty.

8 Answers

  • Phil M
    Lv 7
    1 month ago

    Warranty only pays to replace parts that failed due to manufacturers defects. They will never give you cash. Engine failure in a five year old vehicle is not likely due to defective parts.

  • 1 month ago

    They won't be paying you. Its warranty, not an insurance policy. You are confusing the two, and no, they are not the same. But to answer your question, you won't be pocketing a single nickel. And they aren't required to use a dealer supplied "new" engine either. So it is likely that while a dealer may do the actual repair, if you so choose, you could end up with a junk yard motor being put in it.

  • Anonymous
    1 month ago

    We can't tell you for certain. Not all warranties are the same. Either read your warranty contract or call them and ask. My guess is that they''ll determine that the problem was either due to poor maintenance or abusive driving on your part and you won't get a dime. 

  • 1 month ago

    Ask for the cash.  Then turn the vehicle over to the insurance company.  They can sell the salvage and lower their cost.

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  • May
    Lv 6
    1 month ago

    Have you given any thought to ask your extended warranty company this question snowflake?  Don't you agree that they would be the best people to answer your question?  Or..... Have you thought about reading your contract?

    I only know that about 98% of all extended warranties are rip offs.  Hope for the moon and the stars, expect much, much less.  (if anything)

  • arther
    Lv 5
    1 month ago

    they will most likely worm out of paying or try a 2nd hand engine if one can be found don't hold your breath waiting for the money.

    Good cars 2nd hand BMW's especially when young blokes rev them. 

  • 1 month ago

    Read the terms of your extended warranty.

    They have so many ways to avoid paying that most are nearly worthless. They won’t pay if the damage originates from an accident. They won’t pay if the damage is due to skimped or incorrect maintenance, or due to undeclared modifications. They won’t pay if any belts snapped because they had exceeded the age/mileage limits. Those are just a few examples.

    But there is no way that they will pay more than the fair market value of your car: in short, if they think it’s cheaper to just replace your car than to fix it then they’ll pay you the fair market value less any deductibles (UK = excess) and will take the car in exchange. If you can get the repairs done cheaper than they believe is possible then you can negotiate a much lower payout and keep the car. It will be much lower because even with a scrap engine, the rest of that car will still be worth at least a few thousand dollars. Unlike a regular car insurance payout, the car will not get a salvage title (or a “write off category” recorded against it if you’re UK based).

  • 1 month ago

    That really depends on what caused the damage to the engine. You might find that it's not covered by the warranty at all. Where did you get the figure $16K+?  A recon should only be about $3K.

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