christn said:
Honda Care does not offer a refund if you do not use the warranty. The have a prorated way of figuring the refund if canceled.
christn - Isn't it true, however, that the plan doesn't need to be established until just before the 36k mark? Is it possible they are selling him a Honda Care plan that won't start till 3years/36k miles down the road. I know this would be very silly but it is possible. It is also possible that the dealership is willing to eat the cost since they sell at a large markup anyway. The price you quoted and the dealership quoted were different by almost 100% (1950 for 7year/100k mile versus 1073 for the same period from you), so even with the prorated plan for the 1050 (their cost which is what Honda would return) assuming a true prorating over the full 7 years (which is unlikely since the majority of the service is back loaded, honda likely backloads the prorating also) that is $150 per year, or $450 the dealership would have to eat. Over the number of plans they sell they can probably safely swallow the 1 in 10 that possibly decide they don't want it, while still making their customers happy. Also let us not forget the percentage point they get from the financial companies that are now financing that $2k, this can also add up to help them reduce the cost of you canceling out of your plan.
But on the flip side, if I were offered such a statement, I would make sure it is written someplace on my contract. Since if they start you right off, they are essentially giving you 3 years of road side assistance for free if you later decide to drop the plan. I would think that christn is right that they have no intention to lose money and that you would only get a prorated return.