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What is a Fully Insured Extended Warranty Product?

A fully insures extended warranty product, is generally more expensive to purchase, but you are able to rest assured that any claims you might have on your vehicle will be met. extended warranty companies that offer cheapie rates are often not covered or insured themselves. Let me explain, in order for a claims reserve account to be able to cover all their customers repairs, they have to have their fund insured. If not, this claims reserve account quickly empties out, and they are unable to meet their obligations to their clients.

For the claims fund to be insured and even better, re-insured, it means that the customer will not have problems with the extended warranty product. Yes, this makes for a more expensive insurance product but it also ensure that you will have no problems with claims and your extended warranty product will offer peace of mind.

It is probably better to not purchase any extended warranty at all than purchase and underinsured product. What generally happens in many scenarios where extended warranty companies try to undersell the competition, is they offer you a cheap product, under fund the warranty claims account and then go belly up when the reserve account is depleted, leaving you with nothing more than a useless contract, not worth the paper it is written on. Better Business Bureau or Web Assured will be able to provide you with the best extended warranty products and good referrals.

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