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What is the difference between a VW Service Plan and a VW Warranty?

A VW Service Plan on your car is required to maintain the day to day working of your car. Each manufacturer determines what they believe is the most optimum period that the vehicle should be serviced. This is normally determined by the number of Kilometres that a vehicle travels or by a period of time.

When your car is Serviced, some of the items that are dealt with are the “easy” to change parts that wear over time or become dirty and need replacing. These items may include Oil, Air filters, Fuel filters, Oil filters, Brake fluid, spark plugs and certain belts such as Cam belts or Fan belts at certain times (these times differ depending on the manufacturer).

A VW Service Plan can be purchased to cover some or all of these items. Most Service plans you pay for the full amount upfront for the period or the kilometres that you would like covered. Often you can purchase a Service Plan for less than what it would normally cost you to Service the car yourself. This happens when the company supplying the plan has managed to negotiate preferential rates with suppliers. What we sometimes are not aware of is that Service Plans are not Maintenance Plans. Items such as Brake pads are not covered under some service plans and are covered under the Maintenance Plans. Service plans generally cover the items required by the manufacturer to keep the vehicle working and to prevent major damage from occurring. When you claim on your service plan, you will get assistance with the payment up to the benefits as predetermined under the plan. There may be times when the company servicing your vehicle may look to charge more. Many Service Plan companies will be able to ensure that these overcharges do not occur. The company that is servicing your vehicle may charge you directly for some of the items not covered by the service plan – such as Brake pads or windscreen wipers.

A Warranty is an insurance policy that covers you should a major mechanical or electrical item break in your vehicle. Items that are commonly insured under a warranty are Engine, Gearbox, Management System, Steering Mechanism and so on. These items may vary a little from company to company, generally most are the same, and the value of the cover is determined by the premium that you pay. Most Warranty companies have a range of products that you can choose from depending on your budget or the amount of cover that you would like. A Decent warranty can range in price from R200 per month up to R500 per month. If you are paying less that R200 you will probably find that you will not be sufficiently covered when you claim. If you are paying more than R500, you need to look around to see what the market has to offer. If you are buying your warranty from a dealer that you are purchasing your car from, you will pay anything from R4200 up to R12 000, depending on the level of cover. This will keep you covered for 2 years. Again – anything less than R4200 is probably no good and anything over R12000, keep shopping.

Make sure that there is no excess that you will need to pay if you claim. Also ensure that there is not a fee that is paid when you claim, for your claim to be assessed.

What we have done is taken the “middle man out” . Although this is not a new concept in the insurance industry, it is a first for a company that sells an aftermarket Warranty. The other thing VW Service Plan have done is removed the paperwork. By removing the middleman and the paperwork (Only available online) we have managed to substantially discount our range of Warranties without changing the benefits. A R12000 Warranty, with incredible benefits, now only costs R+-8600. You save R2876 or 25%. The middle of the range product that normally sells for R7000 now sells for just over R5000. VW Service Plan's only proviso is that you buy online off their site. Even our site is simple, to save costs. Every cost saving is passed onto the consumer.

We are also in the throes of developing VW Service plans for most cars and as the different brands become available these will be released on our site. We are determined to keep the principle of passing on the savings to motorists.