Auto warranty is an assurance given by the vehicle manufacturer in association with the auto dealer to replace or repair a faulty part of the car without charging any fee for a particular period of time from the date of its sale. However, the warranty does not take care of the cost of all parts. On occasions, car companies have even replacement an entire unit of the car if the product was found to be defective.

In auto warranty, there are two categories. The first is the new car warranty, which is issued to brand new cars. The second category is the used car warranty issued for pre-owned cars and used cars. It is also called as aftermarket auto warranty. Normally, the used car warranty is expensive when compared to new car warranty considering the age of the vehicle.

Both new car warranty and used car warranty are issued under two bases. They are distance covered by the vehicle from the date of sale or age of the vehicle. For instance, auto warranty is available for a period of up to two years from the date of its sale. Similarly, warranty is given for up to 30,000 miles covered by the vehicle.