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DEFINITION of 'Warrant Coverage'. An agreement between a company and its shareholders whereby the company issues warrants equal to some percentage of the dollar amount of the shareholder's investment. Next Up.
Auto manufacturers typically provide warranties as part of the overall cost of a new vehicle. These warranties will cover certain car problems and last for a certain number of months or years and miles of driving.In addition, auto dealerships often sell extended warranties.Sometimes, these extended warranties are called service contracts. These extended warranties cover the costs of some unexpected car repairs not covered by the manufacturerâs warranty. They can be very profitable for the dealer and expensive for you.ou should also check whether the coverage of the service contract overlaps with the problems and time periods the manufacturerâs warranty covers to avoid paying for unneeded coverage. You may find that any additional coverage is not worth the additional cost.