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Service and warranty: Motorplans explained

2015-06-15 07:38


PEACE OF MIND: Car ownership can prove costly if you're not informed about warranties and service plans.Image: iStock

Data extracted from an international motor vehicle buyers' behaviour study suggests that nearly half of them start their search for a new or used vehicle unclear about the make or model they want, reports the Innovation Group.

And that's just the beginning…

In addition to the daunting array of vehicles available, today’s buyerr is faced with a bootful of additional choices after they have settled on a specific shape, colour and engine size.


Trevor van Rensburg, assistant marketing executive at the Innovation Group, takes a look at the evolution of aftermarket value added products in South Africa and how these developments can be used by road buyers for maximum benefit.

Engine cover is an integral part of owning and operating a vehicle. Even the sturdiest budget can be dented by the debilitating cost of repairs.

Van Rensburg said: "Consumer needs, economic circumstances and driver trends are evolving rapidly. As a result of these changes, automotive value-add products have become more flexible and it becomes easier to tailor a vehicle’s protective cover around lifestyle, usage and financial uncertainty.

"Product development teams constantly scan the environment for gaps in the market. Claim statistics on various models are reviewed so that the data can be used to adjust pricing and develop customer focused products."


It is common knowledge that the older a vehicle is the higher the probability for mechanical or electrical failure. The cost to repair out-of-warranty vehicles can be huge, with repairs ranging from R5000 to R10000.

Warranties conform to the requirements of the Short-Term Insurance Act and cover a vehicle for mechanical and electrical breakdown of components. Often roadside assistance, car rental, medical assistance, and Road Accident Fund claims management may also be included in the package.

Vans Rensburg said: "A contracting economy means that people are less likely to buy new cars as regularly as they would during boom time. The extended warranty allows the consumer to hold on to a car for a longer period of time without the anxiety of costly breakdowns.

"Warranties are normally also transferable between vehicle owners which have a positive effect on the re-sale value of the car."


Maintenance Plans provide cover for parts such as replacing brake pads or shock absorbers. Not only are payments for services for the duration of the contract include, but wear and tear and mechanical failure costs are covered.

Van Rensburg said: "A fluctuating Rand may influence the price of parts, while inflation takes its toll on labour costs. These costs are impossible to predict and difficult to absorb on a restricted budget. This product makes financial planning less of a stab in the dark."


These plans are similar to maintenance plans but do not extend coverage to the any sort of mechanical or electrical device should it become out of order or broken. The don’t cover components such as brakes, clutch and cam belts.

Vans Resnburg adds: "Service plans are, in general, more popular than Maintenance plans because they are a lot more cost effective."


In addition to these three fundamental motor plans, additional value added products are also becoming increasingly popular in bolstering standard insurance cover.

Add-on services can include top-up service plans, tyre and rim warranties and scratch and dent cover.

Vans Rensburg said: "Benefits to consumers have to be real and tangible. Drivers today have a host of options available to them that are both convenient and cost-effective."

Read more on:    arrive safe  |  maintenance

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