Robb Hicken: Beware of extended service contracts

May 8, 2014 

Robb Hicken.JPG

Robb Hicken

STATESMAN FILE

For more than a year, Eilleen Waddell of Fruitland has been monitoring the mail for her deceased father-in-law.

"We have his mail coming to our address to finish his affairs," she says.

So when the Vehicle Administration Center sent him an important and private factory warranty or extended service contract notice, she was baffled. In bold letters it read: 2nd Attempt.

"He passed away a year ago, and he's not owned a vehicle for several years," she says. "He died at age 96."

The mailings appear to be a notice from a car dealer or automaker. There is always an eye-catching warning on the front of the card, such as: "Request For Immediate Action - Time Sensitive Material."

The company that sent the warranty is located in Phoenixville, Penn., and has an F rating with the Better Business Bureau for nonresponse to complaints.

The Better Business Bureau warns consumers to be wary of fliers, postcards, mailers and telemarketing calls claim an auto warranty is about to expire. The deceptive solicitations could persuade car owners to buy an extended auto service contract of questionable value.

BBB has received complaints from consumers across the Treasure Valley, and nation, who were told their car warranty was about to expire, when such was not the case, and that they needed to take immediate action to avoid a lapse in coverage. BBB research shows that the consumer is actually being sold an extended-service contract, and despite the impression given, the offer is not associated with the car manufacturer's warranty.

The value of the various extended-service contracts being sold also has been called into question, as many consumers complained that the contract had numerous conditions that might be difficult to meet. For instance, pre-existing conditions often are not covered, proof of maintenance records may be required, and restrictions on authorized repair facilities and repair charges must receive prior approval, making many of these contracts virtually worthless. Others report difficulty in obtaining refunds.

BBB offers the following advice for dealing with a firm selling extended auto service contracts:

• Never give personal information, including Social Security, bank or credit card numbers, over the phone to an unknown telemarketer.

• When considering an extended service contract or any other type of telephone solicitation, insist on getting a contract in which all terms and conditions are clearly explained before signing up or providing credit card or other payment information.

• Read your auto manufacturer's warranty and contact your dealer or manufacturer so that you are not purchasing duplicate coverage.

• Before purchasing extended warranty coverage, consumers should always check the company out first with BBB at bbb.org.

• Consumers can place their phone number on the federal do not call list by visiting donotcall.gov. If the consumer is already on the list but continues to receive solicitations or telemarketing calls, he or she can use the same Web site to report the incident to the FTC.

For more information you can trust on avoiding fraud and identity theft, go to bbb.org.

Robb Hicken: 947-2115

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