How Do Extended Warranty Companies Handle Claims?

Our promise to you...Jim Jennings Transmissions' job is to properly diagnosis and thoroughly explain our diagnosis to your extended Warranty Company. Assist their inspector with their on-site inspection with the goal of ensuring your Warranty Company pays for all the repairs they are legally and morally obligated to pay. We're on your side!

Extended Warranties
  1. They provide health insurance policies for your vehicle and just as with health insurance, all policies are not created equal. Some are more expensive than others and will pay for more repairs, pay a higher labor rate and are more generous with rental vehicle assistance.
  2. Our experience with policies bought over the internet or by phone, requiring monthly payments, has been very disappointing. They tend to be difficult to deal with and ultimately pay far less than other policies.
Diagnosis
  1. Warranty Companies rarely pay to diagnose the problem with your vehicle.
Maintenance records (Extremely important)
  1. Warranty Companies frequently ask for your maintenance records to show engine oil changes, transmission, transfer-case and differential fluid changes have been done per the owner's manual's recommendations. The receipts must be computer generated. Records are faxed to them & handwritten receipts do not count. Failure to supply the maintenance records may result in your claim being denied.
Claims Adjuster/Inspector
  1. Your warranty company may choose to send an independent inspector to verify your concern, verify mileage, look for vehicle alterations, inspect failed parts, take photos and look for the cause of failure.
  2. The inspector may want to drive your vehicle to verify your concern before moving your claim forward.
Commercially used vehicles
  1. Most extended Warranty Companies exclude vehicles used for commercial purposes including Uber, Lyft & vehicles used for food delivery. If the inspector sees a ride-share decal they will likely deny your claim.
  2. If a vehicle looks like it is used for commercial purposes, the inspector may void your coverage.
Rental Vehicle
  1. The warranty company will not authorize rental vehicles until they have agreed to pay your claim.
  2. You may choose to rent a car at any time that is convenient for you, however, if the warranty company denies your claim, they will not pay for your rental.
  3. The amount of rental expense covered under your contract may be based on the labor hours needed to complete the authorized repair. Those hours are taken from a labor guide and one day of rental may be allowed for every eight hours of shop labor. Rental days are not based on the down-time of your vehicle.
  4. The maximum amount paid by your warranty company is usually $35 per day up to 5 days.
Tear down
  1. Your warranty company may require your transmission, transfer-case or differential be removed from your vehicle and be disassembled for an inspector to take photos. They do not pay for this step.
  2. The warranty company requires you to authorize this "tear-down service" because, if they deny coverage for the repair, they will not to be liable for the removal, tear-down and reinstallation of the component.
Deductible
  1. Most Warranty Companies require the insured to pay a deductible from $0 to $500 per occurrence.
Examples of items Warranty Companies frequently will not pay for:
  1. Sales Taxes
  2. Fluid & filters. The Warranty Companies consider these to be maintenance items.
  3. Occasionally external seals and electronic parts are not covered.
  4. Their policies frequently spell out that they only cover internally lubricated components.
Labor rate
  1. All Warranty Companies limit the hourly rate they will pay for repairs.
  2. You will be required to pay the difference between the amount the warranty company pays and the amount necessary to do a quality repair.
Completion time
  1. Completion of your repair may be delayed for one or more of the following reasons:
    1. Delay waiting for an inspector to inspect your vehicle. Usually 24 to 48 hours.
    2. Delay awaiting the decision of the claims adjuster once he receives the inspector's report.
    3. Delay waiting for components to be shipped to us by your warranty company.
    4. Delay because of a wrong part, worn-out or defective part shipped to us.
LKQ
  1. LKQ is an industry term used to describe a used component such as a transmission. LKQ stands for LIKE, KIND & QUALITY. That means the used part must be the same as in your vehicle and the mileage must be the same or lower than what is currently on your vehicle's odometer.
  2. Your warranty company may only be obligated to return your vehicle to its pre-breakdown condition. They are not obligated to pay for new parts and a used component is usually cheaper than a rebuilt or remanufactured part.
  3. They may send us, or ask us to supply, a used transmission or other component that matches the component that failed. Theoretically, that used component should have the same or lower miles than the component being replaced. The trend in the industry is to ship a used component instead of rebuilding it.
  4. You have the right to direct us to rebuild your transmission, transfer-case or differential and pay the difference between that cost and the amount your warranty company is willing to pay. An example of this is: if your warranty company is authorizing a used transmission for $2,800 and a quality rebuilt will cost $3,400, you can elect to pay the difference and get a longer warranty.
  5. Most used components come with at least a 6-month warranty. If you have two or more years left on your policy, a used transmission, transfer-case, or differential may be an acceptable risk.