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Preferred Warranties

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10 User Reviews

1.7

Overall Score

Preferred Warranties, Inc. (PWI) was started by car dealer Wayne Herring, who owned and operated an independent used car dealership near Pottsville, Pennsylvania. Due to the market demand among car dealers for reputable extended service contracts, Herring found his niche. Before long, Preferred Warranties had a growing client list consisting of dealers in three states. Just six short years later, the company was ranked #179 on the Inc. 500 list of Fastest Growing U.S. Companies. The company has also earned several milestone accolades. Today, Preferred Warranties is owned by parent company KAR Auction Services, Inc.

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The Good

  • Time in Business

Time in Business

Preferred Warranties was founded in 1992 solely as a car warranty company. Being in business for 24 years is a reputable length of time in comparison to other companies in the car warranty industry, some who were also founded in the 1990s. There are several car manufacturers (Chrysler, Lexus, etc.) who have been in business much longer; however, they did not offer warranties until after being in business for years.

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The Bad

  • Warranty Costs
  • Basic Warranty Features
  • Basic Warranty Length
  • Powertrain Warranty
  • Other Features

Warranty Costs

The cost of Preferred Warranties Base Plan is a one-time payment of up to approximately $1,500. This fee is paid beforehand since customers online indicate this. On average, Preferred Warranties' repair deductible is $50-$100. PWI does not appear to offer a flexible payment plan where you can make payments over time, which may be more affordable for certain customers.

Basic Warranty Features

Unlike several basic warranties (e.g. bumper-to-bumper or new-vehicle warranties) offered by many car dealerships, Preferred Warranties offers plans for used vehicles only. If you want to get coverage for a used vehicle, Preferred Warranties offers a Base Plan. The Base Plan covers a full array of components including air conditioning, brakes, steering, electrical, engine and drive axle. Some basic warranties even include tire rotations and oil changes, but Preferred Warranties does not. Preferred Warranties also offers Premier Exclusionary Coverage, which is like new car coverage for your pre-owned vehicle. The Premier Plan covers practically all factory-installed mechanical and electrical operating parts. What it doesn't cover is scheduled services and normal wear and tear, such as engine tune-ups, batteries, filters, fluids, A/C refrigerant, hoses and belts, wiper blades, brake pads, tires, wheels and balancing, exhaust system, catalytic converter, and manual clutch components. Car owners also do not get covered for any structural issues like bumper damage, paint, or door panels. Repairs to meet emissions standards also will not be covered.

Basic Warranty Length

Preferred Warranties Base Plan offers unspecified length. At the high end, basic warranties last up to 10 years or 100,000 miles, whichever comes first. At the lower end, they can last only three years or 26,000 miles. The company's warranty length for the Basic Warranty depends on the dealer and the state you reside in. Going to the dealership and/or setting up a meeting to discuss plans is mandatory. We found that other companies in this industry were more lenient with sharing their plan length and pricing details.

Powertrain Warranty

Preferred Warranties' Powertrain coverage includes all engine internal lubricated parts and transmissions for both automatic and manual vehicles. The Powertrain Warranty lasts for a certain amount of time that is not specified. Buyers can select different features of their warranty, giving them many options to purchase only the coverage that they need. Because pricing is dependent on each individual's choices as well as their location, etc., we cannot give specific pricing options.

Other Features

In addition to a basic warranty, powertrain warranty, and corrosion warranty, Preferred Warranties offers a total of seven plans: Base, Powertrain, Budget, PowerSports, Plus, Premier, and Extra Mile. Preferred Warranties offers 24/7 roadside assistance. Other than that, there is not much else customers can expect in terms of warranty features. Another thing to note is the limited funds available for towing. Preferred Warranties will only pay for $75 of a towing service you need. PWI also has less rental coverage than many competitors.

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The Bottom Line

Preferred Warranties holds a solid premise for used-car owners looking to save money on inevitable repairs. Although the company offers several comprehensive plans for used vehicles with 24/7 roadside assistance, there exists a sizable number of unsatisfied customers who have not received the coverage as promised. This is especially an issue due to the large deposit ($1,500) paid upfront. Also, towing and car rentals have limited coverage, which is a minus. Corrosion is covered for transmissions but is limited only to internal parts. Therefore, we cannot recommend Preferred Warranties. 

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Star Rating

1.4

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10 Reviews

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1 grade

90%

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Alex Bear Portland, OR

When it comes to warranty everyone has a fear of buying something that would not actually cover what they say they cover. 2006 F-150 Had an issue that at first seemed like an easy fix, but turned out it wasn't covered in the plan I purchased. PWI still decided to pay for partial part of just because they wanted to help me out as best they could. Thank you PWI so much, you covered something didn't even have to cover. Business done right.

2 years ago

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Reply from Preferred Warranties

Thank you so much for the excellent review. We are so glad you are happy with our services.

Feb. 22nd, 2019

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John Holloway Ft. Washington, MD

Please do not buy a warranty with this company. I was told by the Dealer that they cover every thing, from bumper to bumper. Less than two days the check engine light can on. It fail to start. I called the dealer which is DMV is another bad place to buy a car. They said call your warranty plan which is "PWI " they insisted take the car go to one of their repair shops. I talk with them, their shop said take it to an authorize dealer. I did had the car towed to a dealer. Than I called PWI, they said they only pay up to 80.00 of labor cost. Sadly everything the car needed to make the repairs, they didn't cover. After paying for three years of warranty and they said that they only cover the basic, which was 1 thur 15 and I didn't get a complete contract from the dealer. Just a copy of the front page of the contract. avoid this at all cost. This is a riff off warranty company.

1 year ago

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Zach K Hollywood, FL

Do not purchase this warranty. I purchased the Plus plan that includes everything in power train and in base. They do not cover all the items listed on the brochure and they also limit what they're willing to spend on the coverage! For example: They only pay for $75 hourly labor rate. That was the rate back in 1980!! It's well above that amount so guess who has to come out of pocket? They also refused to fix the turbo charger lines within the turbo charger housing which is listed on the brochure of coverage! They also didnt want to pay full coverage on the door actuator which is LISTED on the brochure as well! This warranty is a complete SHAM! DO NOT PURCHASE COVERAGE FROM THIS COMPANY!!!!

1 year ago

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Reply from Preferred Warranties

Zach, We understand your frustration. Customer satisfaction is very important to us. We would love the opportunity to review the claim events with you. We are having difficulties finding your contract. Please leave your phone number so we can call you or feel free to contact us at your convenience to chat at 800-548-1121. Thank you for taking the time to review our service

Jul. 8th, 2019

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Mazin Kahale Aurora, CO

Bought an extended warranty to cover my vehicle from top to bottom including transmission. My Mercedes stopped shifting out of Park, took to the dealership for diagnostics and the Steering column module needs to be replaced as it handles transmission shifts but the Extended warranty states that the particular part is not covered even though i cant shift out of park which is an overall transmission issue. Be very wary this company uses word-smithing/playing games to get out of costly repairs. Will never do business with them ever again. Michael G. is a supervisor in the claims depart who refuses claims and states he is the end all be all and that nothing else can be done. STAY AWAY is my only advice, look for a more reputable company deal with.

1 year ago

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Reply from Preferred Warranties

I am sorry to hear about your frustration. Customer satisfaction is of the utmost importance to us and we will do whatever we can to help ensure your satisfaction. . A member of our leadership team will be in contact within the next 24 hours to discuss your concerns.

Jul. 8th, 2019

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Vinny

I have bought and sold 4 vehicles, all with warrantys. NEVER have I had this many problems. They were transferred or refunded no problem because my miles/terms were not exhausted. I have never been able to use this warranty it has paid for nothing. This company, will not transfer ANYTHING. I have a year and change left on my warranty, I was informed I get no refund for this in the event I sell it, but if my car was repossessed because I cannot use it the loan would be refunded. I will never buy an extended warranty from this company again, nor work with dealers that knowingly use their service for profit knowing the difficulties. Woman on the phone was extremely unhelpful and snide.

3 years ago

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David

I normally don't write reviews but I decided I had to write this one in order to expose PWI's fraudulent polices. I bought my PLUS policy that covers just about everything for my Ford F-150. About a month after I received my “Welcome to the PWI family” packet in the mail, my truck started experiencing some rough running. Never fear, I have my “peace of mind” policy (as my automobile dealer touted). So I called PWI and reached a friendly voice that directed me to take the truck to a local repair shop. The repair shop diagnosed the problem which was also personally confirmed by PWI's local ASE certified mechanic. When I called PWI as to the diagnosis, they informed me that that a worn timing mechanism had caused oil starvation to the upper part of the engine. They recommended replacement of the timing mechanism, camshafts and cylinder heads. They also informed me that they were not going to be covering this because it was a pre-existing condition. I argued with them, telling them that the truck did not have this rough running issue at the time of purchase and that if they claimed this was a pre-existing condition that EVERYTHING could be claimed as a pre-existing condition. Yes, your brand new car is starting to fail the moment you drive it off the dealer's lot. It just hasn't reached a point that it is exhibiting any symptoms! Next they noticed that the Carfax had some mileage discrepancies (to the tune of a hundred miles or so). In this case, somebody apparently fat fingered some mileage inputs. Anyway, this discrepancy had nothing to do with my claim since I had put a thousand or so miles on the truck since purchase. So I sent them all of the mileage documentation I had to attempt to clarify the errors and then patiently waited for adjudication. When I called them they explained that, due to the mileage discrepancy, they were CANCELLING my policy and returning my payment. Imagine my surprise when I received my certified letter in the mail that said this: “This letter is to inform you that, due to established policies and procedures, we cannot accept the PLUS warranty contract on your recently purchased 2008 Ford F150”. In the half dozen calls I made to PWI, the fact that I had a contract on a 2008 Ford F-150 was NEVER mentioned. Wouldn't you think that the PWI underwriters would have noticed I had a Ford F-150 and consulted their “policies and procedures” BEFORE they sent me my “Welcome to PWI” packet? No, not if you want to cheat your customer! In the contract that I signed it says PWI can only cancel my contract for three reasons: I didn't pay for the contract (yes I did), the odometer has been altered or disconnected (which it has not) or I committed fraud or misrepresentation at the time of sale or anytime thereafter (no). So I have a legitimate breach of contract (in case there are any lawyers out there reading this and want to take up my case). Of course I could easily win a breach of contract case but then I'd have to fight them on the “mileage discrepancy” issues followed by the “pre-existing condition” issue. Paying a lawyer to take my case would not be cost effective. As I honestly believe PWI knows this! So I'm fighting back the only way I can, hence this review. PWI might be nice enough to replace your water pump or alternator but they are NOT going to lose money paying for your costly repairs. So don't throw away your money on a PWI warranty!!! You might be wondering how my truck repairs ended up. The difference in cost to replace the recommended parts verses getting a brand new engine was $300. So $6000 later I have a “new” truck. Thanks for nothing, PWI!

3 years ago

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Mikala Phipps Wingate, IN

Do not even bother with this company. In 2018 we bought a 2009 gmc acadia with a PWI warranty. Two months later engine needed replaced. We were told the engine we got only had 40,000 miles on it. Less than a year later the engine is down again and we’re told our warranty is up and the engine PWI bought had NO additional warranty on it. So here we are without a driveable vehicle and no way to get it fixed. Who buys an engine with no warranty coverage?!

1 year ago

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Reply from Preferred Warranties

Mikala, I am sorry to hear about your frustration. Customer satisfaction is of the utmost importance to us and we will do whatever we can to help ensure your satisfaction. . A member of our leadership team will be in contact within the next 24 hours to discuss your concerns. Thank you for taking the time to review our service.

Jul. 8th, 2019

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Herman Pereira Durham, NC

PWI Preferred Warranties is by far, the worst company that I have ever had to deal with. They refused to honor their warranty. My vehicle has been in the shop for seven weeks with them trying to find a way not to honor their warranty. I was given 5 or 6 reasons for the problem while none make any sense. When you purchase an extended warranty, you`re hoping it is with a repulable company, but this one`s only intent is to take your money. I urge you never to count on this company. Sincerely, Herman.

4 years ago

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Brandon Hinton Mishawaka, IN

I have 3 words for this company scam scam and scam. Can I rate them without giving them a single star? My engine seized up and after a month they denied my claim. When i buy my next new car if a extended warranty is offered I will walk out without exception. I will also be looking into a lawyer.

2 years ago

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Keni A. Thibeaux Fresno, TX

Avoid them and save youroney. The warranty was completely useless when it was needed. I would've been much better off putting the spent on the warranty aside for repairs because the warranty covers virtually nothing.

2 years ago

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