Car warranties can offer peace of mind, especially for owners of high-mileage vehicles. Olivia Lee, a meticulous owner of a 2001 Volvo with 158,000 miles, understood this when she decided to purchase a CarShield warranty after seeing one of their commercials. CarShield, a prominent national company, heavily markets these warranties, promising coverage and flexible monthly plans tailored to individual needs. But behind the well-known CarShield brand lies another company that plays a crucial role in these vehicle service contracts. So, who exactly is behind CarShield, and what should consumers know?
To answer the question “who owns CarShield” directly is slightly misleading. CarShield itself is primarily a marketing and sales company for vehicle service contracts, often referred to as extended car warranties. While CarShield presents itself to consumers, the vast majority – around 95% – of the warranties they sell are actually administered and backed by American Auto Shield. This crucial detail, often less emphasized in CarShield’s marketing, is confirmed by CarShield’s own attorney, Mike Carter. Therefore, while CarShield is the customer-facing entity, American Auto Shield (AAS) is the company that underwrites and manages most of these service contracts. Understanding this relationship is key for consumers considering a CarShield warranty.
This connection becomes even more important when considering customer feedback and ratings. CarShield has faced scrutiny, including an “F” rating from the Better Business Bureau (BBB) in the past, due to what the BBB described as “misleading sales and advertising practices.” While CarShield has disputed these ratings and even filed lawsuits against the BBB, it’s essential for potential customers to be aware of these concerns. Adding another layer of complexity, American Auto Shield has also been subject to BBB alerts regarding a “pattern of complaints.” These complaints often revolve around claim processing, coverage disputes, and overall customer service experiences. While CarShield argues that their complaint percentage is low relative to their business volume, the recurring alerts and negative ratings for both CarShield and American Auto Shield warrant careful consideration.
To illustrate the complexities and potential pitfalls, consider the experience of Olivia Lee. After purchasing a CarShield warranty for her Volvo, she faced a transmission issue. While her claim was initially approved, the process involved not only CarShield and American Auto Shield but also a repair shop, King’s Automotive. This multi-party system can become complicated quickly. In Lee’s case, a salvaged transmission was used for the repair – purportedly approved by the warranty company – which ultimately failed. Despite CarShield’s denial of using salvaged parts and paying $2,000 to the repair shop, Lee was left with a non-functioning car. Frustrated after months without a solution, she independently invested over $3,200 in a rebuilt transmission and its installation to get her car back on the road.
Olivia Lee’s extended car warranty experience highlights the complexities of dealing with CarShield and related companies.
Consumer advocate “Better Call Harry” intervened, and eventually, Lee received partial refunds from both the repair shop and CarShield. While CarShield maintained they fulfilled their contractual obligations and attributed the issue to the repair shop, they ultimately provided reimbursement. Lee’s case underscores a crucial point: navigating extended car warranties can be challenging, and understanding who you are truly dealing with is paramount.
As experts at cars.edu.vn, we advise consumers to approach extended car warranties with informed caution. While they can be beneficial, especially for older vehicles, due diligence is crucial. Before purchasing any extended warranty, regardless of the provider, consider these expert recommendations:
- Pre-purchase Inspection: Invest in a thorough inspection by a trusted mechanic before buying a warranty. This provides a clear picture of your vehicle’s current condition and potential future issues, helping you assess if a warranty is genuinely needed and what level of coverage might be appropriate.
- Maintain Records: Meticulous maintenance and detailed record-keeping are essential. Warranty companies may deny claims if they deem maintenance lacking. Proof of regular servicing strengthens your position should you need to file a claim.
- Control Claim Payments: If a claim is approved, request that the warranty company send the payment check directly to you. This allows you to pay the repair shop only after you are satisfied with the completed work, providing a degree of control and ensuring accountability.
In conclusion, while CarShield is the public face of these extended car warranties, American Auto Shield is the underlying entity responsible for most of the contracts. Understanding this relationship, coupled with awareness of customer complaints and experiences like Olivia Lee’s, is vital. By conducting thorough research and following expert advice, car owners can make informed decisions about extended warranties and better protect themselves in the complex world of vehicle service contracts.
