Terms of extended warranties can change

Even though Consumer Reports doesn't recommend extended car warranties, sometimes you can get your money's worth from them. But as this case shows, you need to read the fine print of the policy before you buy it because if it says rules can change during the term, be prepared if they do.

"My warranty on the van had expired."

Bonnie Guzelf intended to keep her van because of its custom-built lift so she bought an extended warranty from Members Direct Heritage. For 4 years there were no problems: Whenever she needed a repair she would just take the van to her local mechanic.

"They got the approval, did the repair, then the warranty company paid them directly."

The last time she needed a repair though, things changed. Heritage was no longer paying repair shops directly. Bonnie had to pay upfront for services.

"Their policy has changed, this is what they do, this is how they do it now, and you have to do that. I would have to submit all the documentation directly to the insurance company and then they would issue me a check in 4-6 weeks."

Reluctantly, Bonnie paid $306 for the covered repair and then waited. After the 6 weeks went by, she says she called Heritage every two weeks with always the same response.

"Your claim has been received, it's been approved, and it’s in accounting for processing."

This went on 4 months until Bonnie called Channel 12. Our volunteers got to the right person at Heritage and she got her reimbursement right away.

"I never thought I'd see a dime of that money again."

Bonnie is mad at herself for not reading the fine print that states Heritage could change how it pays claims-- a good lesson for next time.

"I had no idea they could change in mid-stream and I would want it very clearly written out, that this is the way we process this."

I talked with Members Direct Heritage, they don't know why there was such a long delay in paying Bonnie's claim, but they did get her a check as soon as we brought the problem to their attention and we thank them for that.

Remember, extended warranties are big gambles—sometimes you win, sometimes you lose. Bonnie says she has paid more in premiums for her warranty than she’s gotten back in covered repair costs. Make sure you think carefully before choosing an extended warranty for any product.

Dave Cherry