What are the worst extended car warranty companies?


Editorial team Published on

The worst extended auto warranty companies (technically vehicle service contracts) are often identified by high numbers of consumer complaints, legal actions, and denied claims.

Companies with Major Regulatory Actions or Poor Ratings

  • CarShield: Frequently tops complaint lists and faced a $10 million FTC settlement over deceptive advertising and claims regarding coverage.
  • American Vehicle Protection Corp.: Received a permanent FTC-imposed ban after misleading consumers and taking millions in improper charges.
  • Patriot Warranty / Champion Warranty: Plagued by state attorney general actions, closures under one name, and reopening under another to avoid payouts.
  • Direct Buy Auto Warranty & Concord Auto Protect: Frequently cited in consumer protection data for high volumes of denied claims and difficult cancellation terms.

Red Flags to Watch For

  • Low Approval Rates: Some third-party providers reject over half of repair claims submitted by mechanics based on strict wear-and-tear clauses.
  • Robocalls and Aggressive Sales: Companies that initiate contact via "your warranty is expiring" robocalls are usually third-party brokers rather than direct administrators.
  • The Broker Gap: Buying from a heavy marketer/broker rather than the direct contract administrator often results in finger-pointing and low payout rates to repair shops.