All companies, which produce consumer appliances and equipment, have to replace the item in part or full if found defective within a specified period of time from the date of its sale. This is called warranty. The warranty is generally issued for a period of up to three years from the date of its sale. The warranty period depends on the type of the product. Do not purchase any product, which does not carry a warranty. The same applies to vehicles also. Car manufacturers also offer auto warranty.

Before purchasing the car, make sure that the auto warranty is offered by the dealer. The auto warranty is offered by the dealer in association with a third party. Normally, the third party is responsible for the warranty operation. Normally, each dealer would have tied up with at least three different third party agencies. Therefore, review at least five different offers from different agencies before selecting the warranty. It is imperative to consult an expert before purchasing an auto warranty.

Auto warranty is issued on twin basis. The first basis is the distance covered by the vehicle. The second basis is the time. For instance, the warranty can be in operation for two years or up to 30,000 miles covered by the vehicle, or whichever comes first.