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By Randy Fisher
Once you have decided on the perfect RV for you and your family, you must also decide how you want to protect it.
One thing I can say with confidence after working more than 25 years in the RV industry is that it’s not a matter of if something will go wrong, but when. This is simply because you have a house on wheels with thousands of parts and pieces that you are driving down the road at high speeds for thousands of miles.
Anyone who has owned a home knows there are things that fail over time. Imagine if you put your home on a flatbed trailer and towed it down the road at 70 miles per hour. You bet there would be an increase in items that would fail. So, how do plan for this? Let’s examine some facts.
Most new RVs come with a one-year warranty from the manufacturer, and some of the appliances may have additional coverage. It is always a good idea to figure out what, if anything, is covered after the traditional one-year manufacturer’s warranty.
Now let’s look at some important items to consider:
How long do you plan on keeping the RV?
If you only plan on keep the RV for a short amount of time, my recommendation is don’t get an extended warranty. If you do plan on keeping the RV for many years, then you are likely a good candidate for an extended warranty.
What is peace of mind worth to you?
Most people would agree that having medical insurance makes them feel more comfortable in the event a major medical expense was to arise. The same can be said when it comes to your RV.
There are a lot of expensive components on your RV and with shop labor rates averaging around $140 per hour, there really is no such thing as a minor RV repair these days. So, if you are financially prepared to pay for these expenses out of pocket, you might decide to keep your money in the bank and handle them when necessary.
However, many RV owners are not financially prepared for a major breakdown and being able to pay a small deductible and have the warranty cover the repair is essential.
What should you pay for an extended warranty?
Most extended warranties are sold in the dealership’s finance department at the time the customer is taking delivery of their new RV. The price of the warranty is based on the type and value of the RV. So, an extended warranty on a $300,000 diesel pusher motorhome is going to be substantially more than that of a $30,000 travel trailer.
Also, keep in mind that extended warranties are sold not only to protect the consumer, but also provide profit to the dealership. The benefits of buying the warranty from the dealership is that they are likely going to be the ones doing the repair work, so they will likely have a good relationship with the warranty administrator and will have more leverage in getting things covered.
Next, many people finance their new RV and an extended warranty can be financed into the loan. This means for example that instead of having to come up with $3,000 cash to pay for the warranty, you can simply roll that $3,000 into the RV loan and it may only increase your total monthly payment by $25.
Since dealerships are entitled to a “fair” profit, it is totally up to that dealership as to what they charge for an extended warranty.
In conclusion, purchasing an extended warranty, or not, is an important decision for all RV owners. Some would say they are a waste of money, where others would say they have saved them from a catastrophic expense that they would not have been able to financially bear.
My position goes back to peace of mind and the medical insurance example. Most people choose to have medical insurance and are very lucky if they do not have to use it. Other’s choose to have medical insurance and it has saved them from severe financial hardship.
The bottom line is there will be regular maintenance and repairs that will arise on any RV no matter how little or much you spend on it. Make sure there is a plan in place to deal with this issue that will happen sooner or later.