Consumer Alert

Beware of Offers for Extended Auto Warranties

The Consumer Protection Unit has received numerous complaints recently concerning telephone and mail solicitation for extended auto warranties.

Consumers have described receiving repeated phone calls and calls at inconvenient hours. The calls typically come from telephone numbers that do not identify the business and do not work when the consumer attempts to call them back. Other people have received post cards or other notices in the mail claiming that their auto warranties are about to expire and offering extensions that are supposedly available for a limited time only. The notices may arrive long after the warranty from the manufacturer has expired.

Do not take offers for extended auto warranties at face value! These offers are often misleading because they appear to be associated with the auto manufacturer, when in fact they are coming from unrelated third parties. And they are selling extended service contracts, not actual warranty extensions. An auto warranty comes with a new vehicle at no additional charge. A service contract is an optional plan that can be purchased at any time and covers certain types of repairs. If you are considering purchasing an extended service contract, insist on getting all terms and conditions of the agreement before you sign up or make a payment. Make sure you understand what repairs will be recovered and which shops are authorized to perform them.

Here are some tips for dealing with auto warranty solicitations:

  1. Before entering into any contract, make sure you fully understand its terms and coverage. Review The Federal Trade Commission's list of questions to consider before purchasing an auto service contract.
  2. To reduce the number of telephone solicitations you receive, add your telephone number to the National Do Not Call registry online at www.donotcall.gov or by calling 1-888-382-1222.
  3. Be aware that under Alaska law, telemarketers are required to clearly disclose in the first 15 seconds of the call their name and telephone number, whom they represent, and that the call is a sales call. They must terminate the call if you object to the solicitation or indicate you are not interested.
  4. Don't be afraid to say no or to simply hang up if you receive an unwanted telemarketing call.
  5. File a consumer complaint with the Consumer Protection Unit if you've been the victim of an unfair or deceptive auto warranty pitch or a phone solicitation that violates telemarketing laws.

Consumer Protection Unit
September 2008