When considering any insurance remember the insurance company is in the business to make money for themselves, not as a benefit for you.

I believe I've saved many thousands of dollars by not buying extended car insurance. Shop around, but the best car in the class you want, and don't let yourself be a profit center for some insurance company.

Do people have catastrophic experiences that are covered by the insurance? Absolutely. But long term, I believe extended car insurance is a scam of the highest proportions. And I've got 110,000 miles on my LX.

 

+1. Perfect saying. And the richest businesses in the US are insurance companies and banks.

 

Listening on NPR over Christmas break, there was the announcement that Allstate Insurance was buying Squaretrade for $1.4bln because they were trying to get into the extended warranty market. One of the estimates pegs the US extended warranty market at a whopping $42bln...so between car warranties, electronic warranties, home warranties etc. there are $42bln spent annually on these....I bet the cost of repairs is far less than $42bln.

That said, to each his own. I have an extended warranty on my Ford (it broke down to be $120/year) just because of that peace of mind. The LX is a beast, I just don't want to have a AHC leakage that runs $2500-$4k to repair in the next few years.