For instance, the company called StopRepairBills.com has a great name. But the question is: Is the company living up to it?
"Hey - your car will need repairs - but now, you don't have to pay a cent! One call to StopRepairBills.com will stop repair bills for good." "They stated if you had a vehicle up to 100,000 miles that they would cover your vehicle - any repair or damage under the hood," Paula Barker of West Philadelphia told Action News about the reason she signed up.
So Paula Barker gave StopRepairBills a $150 deposit and agreed to pay $97.74 a month for coverage on her 2000 Chevrolet Malibu LS.
Then "it just started clunking underneath the hood," Barker said.
So she called the company - who sent out an independent inspector to see if the repairs would be covered.
"They stated, 'No. They're not going to cover it - it's pre-existing.'"
Many other consumers are complaining about the company. In fact, Stop Repair Bills has an F grade with the Better Business Bureau. "In the past three years, they've had 433 complaints filed against them," according to Andy Goode of the Better Business Bureau, "in the past year they've had 213 complaints."
That pattern is essentially people aren't getting what they paid for.
StopRepairBills.com goes by many other names, including National Dealers Warranty Inc. It says: "We have no unanswered and no unresolved complaints at the BBB. We have worked with our customers and the BBB to resolve any and all complaints we receive as quickly as possible. As the selling marketer of these service contracts, we have no direct authority over claims procedures, approvals, denials, etc. The contract is with an Administrative Company, such as United Car Care."
While Stop Repair Bills has an F at the BBB, United Car Care has an A+ rating.
So what does United Car Care have to say? It tells Action News: "The car was in bad condition with lack of maintenance evident... All these problems are long-enough term to have pre-dated the purchase of the service contract."
United Car Care also said many of the repairs weren't covered under the contract anyway. For instance, the contract does not cover stand-alone seals and gaskets, belts or hoses.
The Better Business Bureau stresses that people, "should read the contract - understand what's excluded, what's included," according to Goode.
Also customers need to realize that National Dealers Warranty sells service contracts not extended warranties. The contracts have many more limitations than most warranties.
Meantime, the BBB and the Missouri Attorney General do hold National Dealers Warranty ultimately responsible for consumer complaints. In fact, the company has now settled a lawsuit filed by the Attorney General and promised to make some fundamental changes to its business practices.
As for Paula, she contacted Call for Action for help and got a full refund.
"Definitely fight for your rights," Barker said, "and Action News will jump right on it for you."
If YOU need consumer help, you should call 1-866-978-4232 or email Call for Action.
If you're considering a service contract for your car, find out who will administer that contract and research that company, too.