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Thursday, November 18, 2010

Should you Purchase an Extended Warranty on a Semi Truck?

Buying a semi truck is quite an investment with the total cost often being more than many people pay for their first home. Yet this equipment can be used to generate a nice income if you look for work in various aspects of the trucking industry.

One of the biggest overhead expenses for a semi truck owner is the cost of repairs. In addition to the cost of parts and labor, there is the down time for their truck to sit while it is getting repaired. That means no income is being generated during that period of time.

Many dealerships offer a warranty period for a semi truck when you make a purchase. This generally expires after a set period of time such as one year from the date of purchase or after you have put a set amount of miles on the equipment. A good quality semi truck can go hundreds of thousands of miles without experiencing any trouble. Of course this means you have to take good care of it and get it serviced regularly.

You may have the option of buying an extended warranty for your truck either at the time of purchase or when the warranty you already have in place is about to expire. Many owners aren’t sure if this is a good investment or a waste of their money. If you plan to keep the semi truck for several years, you may want to go ahead and invest in that warranty. The more miles you put on the vehicle, the more likely that something major will go wrong.

Owner operators who don’t have a substantial amount of money set aside for repairs definitely need to buy the extended warranty. It can cost thousands of dollars to repair the engine or transmission on a semi truck. This can lead to the owner operator losing their business or suffering a significant economic hardship if they have to come up with the funds on their own.

Some truck drivers make it a practice of getting a new truck every four or five years. This is to offer them the luxuries they enjoy, keep their truck under a warranty, and help them with their taxes because they get to depreciate the value of the truck over a set period of time.

The cost of an extended warranty for a semi truck depends on many factors. The dealership will be able to explain the various options to you regarding the coverage. The more coverage you want the more expensive the extended warranty is going to be. Yet you will find the cost of such an extended warranty is going to be much less than paying for the necessary repairs out of your pocket.

In most instances you can use the cost of the extended warranty as a deduction on your income taxes. This type of warranty may not be extended in all cases so make sure you inquire about it if it is important to you. There are also independent insurance agencies where you can get one on your own. Make sure you carefully compare prices and coverage so you know exactly what you are buying.

You also want to make sure the extended warranty is offered by a legitimate company. Take the time to see if they have any complaints filed against them with the Better Business Bureau. You don’t want to need to access your extended warranty and find out it is a scam and you don’t have any such coverage.

Hopefully you will never need to access your extended warranty but it is a very good safety net to have in place in order to offer you financial security. The trucking industry is a great way to make a living but the wear and tear on the equipment can really affect your bottom line. Protecting yourself against unnecessary and unexpected expenses is an important part of being a successful business owner.