Class 8 Extended Warrenty Cost.

I purchased a used truck and then purchased an aftermarket warranty not affiliated with the dealership or truck maker if that's what you referring to?

I paid $7500 and will never buy one again.

 

I don't pay extra for warranty, on anything, ever, there'll be some clause somewhere in there that will essentially leave you paying for everything anyway.

 

These places make money. They make money by charging more than they pay out. To do this they have to not be worth what is paid. Simple math on this.

You would be better off to spend that money on stuff like oil samples, independent mechanic, dyno/blow by testing and the like.

 

With an new emissions truck I’d probably get one from the oem........I wouldn’t do 3rd party tho .....

 

The emissions system is most likely going to be the system that gives you the most expense and I don't think any used truck warranties will cover emissions systems, you can usually extend the emissions system warranty period on a new truck purchase and that is probably a good investment.

In 2014 (the last year I have personal experience with) Peterbilt had separate warranties for the emissions system on new truck purchases but they wouldn't allow you to extend just the emissions system warranty, you could only extend the emissions warranty if you also extended the warrant on the rest of the truck (which is a pointless expense); but the emissions system is so troublesome and expensive it was still worth it to extend both warranties.

Used equipment warranties are a scam, never buy those.

 

By that logic, we should forego home owner's insurance and life insurance as well.

We shouldn't.

Insurance is a product we buy in those cases when we can NEITHER plan for or afford the consequences. You can't afford to die when you have a wife and four kids depending on your income, and you can't really plan for it. So we buy life insurance -- we should, anyway.

With the modern class 8 emissions truck, things, occasionally, go very much south. Aftertreatment systems go kablooiee. ISX's throw fuel pump parts into the engine. Paccars do funny things to cams. Holset after treatment setups have gotten better....... but the problems are STILL unpredictable, and EXPENSIVE.

So, we make a judgement: do we buy insurance (spend EXTRA money) to give that risk to the insurance company? I chose "yes", full well knowing that on average, I will lose money. Others may have better capitalization rates than I do, and can self-insure. The question is: can you plan (predict) it AND afford it.

All that said, I would never buy a non-oem extended warranty. Too many stories about non-payment and playing hard to get paid.

 

Except, according to what I've read in various trade journals, most "traditional" insurance companies try to pay out 100% of fees. They make money by putting floating money in low risk stocks and bonds.
The 3rd party warranty companies are not an insurance company in they don't follow the typical insurance company model. They very much have to cheat people out of money to stay in business.

 

For life insurance, maybe, but the numbers I can find on Homeowners Insurance is that the payout costs (actual money paid, legal fees and claims adjuster costs) are about 78% of premiums. The remainder of the costs are administrative and dividends to shareholders (the latter is 0.4%). (Facts + Statistics: Homeowners and renters insurance | III)

I fully agree that the third party extended warranty companies are a whole different animal, and should be avoided like the clap...... One source I read states they have a 12% payout rate to customers.....