Bernas said that not only are these phony telemarketers and mailers deceptive about the consumer's coverage, they are potentially ignoring federal laws.
According to Bernas, the BBB has seen a considerable spike in both complaints and inquiries from consumers who state that they received misleading mailers or high-pressure telemarketing calls claiming their auto warranty was about to expire.
BBB offers the following advice for dealing with a firm selling extended auto service contracts: ? Never give personal information, including Social Security, bank or credit card numbers, over the phone to an unknown telemarketer, or anybody else without a specific need to know.
? When considering an extended service contract or any other type of telephone solicitation, insist on getting a contract in which all terms and conditions are clearly explained before signing up or providing credit card or other payment information.
? When considering the purchase of a service contract, it is important to weigh the costs of the contract against the cost of possible repairs of the product. Be aware of vaguely worded exclusions or limitations in coverage or maintenance requirements which, if not followed, would allow the company to deny coverage. Find out how repairs are paid for and if you must obtain prior authorization.
? Read your auto manufacturer's warranty and contact your dealer or manufacturer so that you are not purchasing duplicate coverage. Verify the company and individual with whom you are speaking.
? Before purchasing extended warranty coverage, consumers should always check the company out first with BBB at www.bbb.org.
For more information you can trust on avoiding fraud and identity theft, go to www.bbb.org.