Can an Extended Warranty Company Ask You to Pay to Have Your Engine Torn Down?

Extended warranty companies promise that if you buy a service contract you’ll never have to pay for repairs to your car, but some of these companies put up steep barriers to making claims. Even if the car owner has a diagnosis of a covered breakdown, the warranty company may refuse to cover the owner’s claim until the owner pays to have the engine torn down for an inspection by the company’s mechanic. Tearing down an engine is expensive, and the owner may not be able to afford it.

Regardless of what the warranty company says, it may not be legal for them to ask for an owner to pay to tear down an engine. A service contract is a form of insurance. Generally, the law puts the burden on the insured to show to an insurance company that they have a covered claim, and that is all an insured has to do to make out a claim. The burden then shifts to the insurance company to establish the existence of any exclusions to coverage. If a car owner has a diagnosis of a covered breakdown from a mechanic, the car owner should not have to pay for any further diagnosis to uncover warranty exclusions, but that is what the warranty company may ask you to do, and it is probably not legal.

If a warranty company is denying you coverage, feel free to contact me for a consultation. I can review your situation to determine whether the company is wrongfully denying your claim.

If a warranty company has had someone inspect your vehicle, you probably should not sign anything that in any way approves of the company’s inspection results. You cannot verify the results yourself, and you may be approving an inspection that will be used to deny your claim.