Carshield Auto Insurance: Is It Worth The Cost?

CarShield is a third-party vehicle service contract provider, also known as an extended warranty company. It offers to pay for covered repairs to vehicles for a set monthly fee. CarShield offers eight coverage plans, including six for standard cars, one for fully electric vehicles, and one for motorcycles and ATVs. The company has been in business since 2005 and has served over 1 million customers. While CarShield has received positive reviews from customers on TrustPilot and WalletHub, it has also faced a number of complaints and negative reviews, particularly regarding misleading advertising and denial of claims.

CarShield's vehicle service contract

CarShield is a privately owned company that sells third-party vehicle service contracts, also known as extended warranties. These plans cover expensive car repairs arising from mechanical problems. CarShield's vehicle service contract is similar to an extended warranty, but there are some key differences. For instance, an extended warranty can often only be purchased while the manufacturer's warranty is still valid, whereas CarShield can sell a vehicle service contract even if the car is out of warranty. This means you don't have to worry about being double covered.

Another benefit of CarShield's vehicle service contract is that you can choose when to start coverage. Whether your car is five or ten years old, CarShield has a plan for it. The plans vary based on the age of the vehicle and its mileage, so it's best to purchase the contract when the factory warranty is about to expire. CarShield's contracts are usually given on a monthly term, so you can keep the coverage for as long as you want.

CarShield offers four main types of coverage: Diamond, Platinum, Gold, and Silver. The Diamond plan is the most similar to new car coverage and covers everything except for excluded items. The Platinum plan is referred to as comprehensive coverage and is designed for vehicles that are a little older or have more mileage. The Gold plan covers the powertrain, including the engine and transmission, as well as common repairs such as air conditioning and power windows. The Silver plan is power train coverage and includes all lubricated parts on the engine, transmission, and water pump.

In addition to the four main types of coverage, CarShield also offers specialty coverage for electrical and computer-related issues, as well as coverage for motorcycles and all-terrain vehicles.

CarShield's coverage options

CarShield offers eight coverage plans, including six for standard cars, one for fully electric vehicles, and one for motorcycles and ATVs. The company's plans are available in every state except California.

The eight plans vary from basic coverage for the most important components to comprehensive coverage for the whole car. Here's a breakdown of the four main types of coverage:

Diamond Plan

The Diamond plan is the best coverage option at CarShield, most similar to new car coverage. It covers everything except for excluded items, including most computer systems, electronic components, and sensors. This plan is comparable to a manufacturer's warranty and is exclusionary, listing only parts that are not covered, such as aesthetic parts, trim, hoses, belts, and wear items.

Platinum Plan

The Platinum plan is the second level of coverage, often referred to as comprehensive coverage. It covers the electrical system, air conditioning, starter, water pump, fuel pump, engine, transmission, and more. This plan is the highest level of inclusionary coverage, covering a wide range of parts in the vehicle.

Gold Plan

The Gold plan is the third level of coverage, also known as enhanced powertrain coverage or powertrain plus. In addition to the engine, transmission, and drive axle, it covers the alternator, fuel system, starter, power window motor, and more. This plan is ideal for high-mileage vehicles and does not cover the fuel system.

Silver Plan

The Silver plan is the fourth level of coverage, referred to as powertrain coverage. It covers all lubricated parts on the engine, transmission, and water pump. This plan is a great option for vehicles with high mileage.

CarShield's customer service

In July 2024, the Federal Trade Commission (FTC) announced that CarShield would pay $10 million to settle charges that its advertising practices were deceptive. This settlement indicates a pattern of poor customer service and unwarranted denial of coverage claims.

CarShield's claims

CarShield offers a range of vehicle service contracts, which function similarly to extended warranties. Their plans are available in every state except California.

CarShield Claims

Once the repair is approved, the customer is responsible for paying their deductible directly to the repair facility, as well as any non-covered charges. Covered claims are then paid directly to the repair facility by the contract administrator.

CarShield offers rental car reimbursement of up to $100 per day for up to 7 days in most cases, and up to 14 days if the vehicle requires a full engine and transmission replacement. Additionally, ride-share reimbursement of up to $60 per day is available for Uber/Lyft services.

It is important to note that CarShield's vehicle service contracts only cover specific parts listed on the contract, except for the Diamond plan, which only lists excluded parts. Customers can refer to their contract's coverage section to determine which components are covered.

In terms of customer service, CarShield has received mixed reviews. While some customers praise the company for paying claims, others have expressed disappointment over certain parts not being covered. In 2024, the Federal Trade Commission charged CarShield with deceptive advertising practices, indicating a pattern of poor customer service and unwarranted denial of coverage claims. As a result, CarShield's rating has been adjusted to reflect these concerns.

CarShield's transparency

Additionally, CarShield does not provide real-time online quotes for its plans. While there is a form on the CarShield website that appears to offer a quote, the fine print indicates that a representative will follow up by phone, text, or email. This lack of upfront pricing information makes it challenging for potential customers to make informed decisions about CarShield's services.

However, it is worth noting that CarShield has taken steps to address these transparency concerns. In response to the FTC settlement, CarShield has stated that it is working to improve customer relations and enhance its transparency. The company offers a variety of coverage plans, including options for standard cars, electric vehicles, and motorcycles/ATVs, and provides detailed information about each plan on its website.

Furthermore, CarShield's monthly payment structure and flexibility in coverage terms may appeal to customers who are seeking transparency and simplicity in their auto repair coverage. The ability to choose a monthly plan that fits their budget and coverage needs can be attractive to those who want to avoid long-term commitments or pre-payments.

Frequently asked questions