Yes, you can sue a car warranty company if they fail to honor the terms of your warranty contract.
Here are some common reasons why someone would need to file a lawsuit against a car warranty company:
Table of Contents
3 Reasons To Sue a Car Warranty Company
| Reason to Sue | Details |
|---|---|
| Breach of Contract | If the warranty company denies a legitimate claim covered under the warranty terms, you may have grounds to sue for breach of contract. |
| Deceptive Practices | Some warranty companies may use misleading advertising or fail to disclose important limitations, which could constitute deceptive practices you can sue over. |
| Failure to Repair | If the warranty company is unable to successfully repair your vehicle after a reasonable number of attempts, you may be able to sue for a refund or replacement vehicle. |
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Legal Options If You Have Been Denied a Car Warranty Claim
If a car warranty company denies your legitimate claim, you have several legal options to pursue:
- Review the warranty contract thoroughly
Carefully read through the terms and conditions of your warranty contract to double check that the repair should have been covered. Identify the specific provisions that support your claim. - Follow the appeal process
Most warranty companies have an internal appeal process outlined in the contract. Follow these steps to dispute the denial, providing documentation and evidence that your claim is valid under the terms of the warranty. - Seek mediation
Many states have consumer protection agencies or dispute resolution programs that can mediate between you and the warranty company. Filing a complaint with these agencies may help resolve the issue without going to court. - Send a demand letter
If the appeal is unsuccessful, send a formal demand letter to the warranty company, outlining your case and the compensation you are seeking. This letter serves as evidence if you decide to take legal action. - Consider small claims court
For claims under a certain dollar amount (varies by state), you can file a lawsuit in small claims court against the warranty company for breach of contract. Represent yourself and provide evidence like repair records and the contract terms. - Hire an attorney
For larger claims, you may want to hire a consumer protection attorney who can file a lawsuit in a higher court against the warranty company for breach of contract or violations of consumer protection laws. - File a complaint
As a last resort, you can file a complaint with the Federal Trade Commission (FTC), your state’s attorney general’s office, or the Better Business Bureau. This may prompt an investigation into the warranty company’s practices.
When Can You Sue?
Before suing, you should carefully review your warranty contract and documentation to make your claim is valid.
Most warranties create contracts written by very expensive and very skilled attorneys.
These contracts require you to strictly follow certain procedures, such as giving the company a chance to repair the vehicle or going through arbitration.
If the warranty company continues to deny what you believe to be a legitimate claim after you’ve followed the proper channels, you may have grounds to file a lawsuit.
Keeping detailed records of all communications and repair attempts is mandatory if you hope to win!
How to Sue a Car Warranty Company
- Review your warranty contract to understand your rights and the company’s obligations.
- Follow the dispute resolution process outlined in the contract, such as notifying the company and allowing them to attempt repairs.
- Document everything, including dates, issues, repair orders, and communications with the warranty company.
- Consider hiring an attorney who specializes in consumer protection or lemon law cases, as they can navigate the legal process more effectively.
- File a lawsuit in small claims court or a higher court, depending on the amount you’re seeking to recover.
Key Statistics and Legal Actions: Why Suing Car Warranty Companies Can Be Justified
This table highlights key statistics and successful legal actions against car warranty scams in recent years, showing why suing these companies can be effective and justified.
| Statistic | Description | Source |
|---|---|---|
| Volume of Scam Calls | 1 billion auto warranty scam robocalls in June 2022. | Consumer Affairs |
| Market Share of Scam Calls | 13-17% of all robocalls in the first half of 2022 were car warranty scams, the highest category. | Consumer Affairs, RoboKiller |
| Impact of Regulatory Actions | After FCC action in July 2022, robocalls dropped from nearly 1 billion in June to fewer than 7 million by September 2022. | RoboKiller |
| Consumer Complaints | Over 12,000 consumer complaints about auto warranty scams to the FCC in 2021. | Car and Driver |
| Prevalence Among Adults | 70% of U.S. adults encountered a car warranty scam from October 2020 to October 2021. | AARP |
| Total Reports of Auto-Related Fraud | 126,240 reports to the FTC in the first nine months of 2023, making up nearly 3% of all fraud reports. | Consumer Affairs |
| Legal Actions | FTC lawsuit against American Vehicle Protection Corp. for running a multi-million dollar scam, resulting in a $6.6 million judgment and lifetime industry bans for defendants. | FTC |
| State Action | Pennsylvania AG secured a $1.7 million order against Delta Auto Protect for not honoring repair coverage contracts. | Attorney General of Pennsylvania |
| Regulatory Order | California Department of Insurance ordered Infinite Auto Protection to cease operations for failing to honor warranties without a license, facing up to $500,000 in fines. | ABC 7 News |
| Largest Fine Issued | FCC’s largest fine of $299,997,000 against perpetrators for 5 billion calls in 2021. | USA Today |
My Final Thoughts
The key to suing and winning against a car warranty company is to document everything, follow the proper procedures outlined in the contract, and be prepared to present a strong case showing that your claim was wrongfully denied under the warranty terms.
Seeking legal assistance will definetely improve your chances of a successful outcome and will also show the company you have no intention of letting this go.
