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What is a service plan?

  • Fixed-price servicing explained
  • Pay for servicing upfront
  • Should you opt for one? 

A service plan is a fixed-price deal whereby you pay for a set number of services when you buy the car.

What is it?

Service plans can be bought to pay for routine servicing for your car for a set number of years and/or mileage.

You can pay in one lump sum or in monthly instalments for a price that’s fixed at the current rates. The number of services you pay for can vary, as can the level of cover.

Buyers can opt to pay for a basic service or more comprehensive cover as part of a particular manufacturer’s offer – for example Volkswagen also offers tyre, alloy wheel and windscreen cover as part of one of its service and maintenance plans.

The terms of the agreement require you to service the car through a main dealer which helps with residual values by ensuring a full service manufacturer history at the correct intervals. So while it may cost more than your local garage charges, you'll end up with a car that's worth more and easier to sell. 

Do I need it?

If you want guaranteed servicing costs, then it may be worthwhile as the price is fixed at today’s rates. It also helps buyers manage the cost of keeping your car maintained and it ensures it’ll be serviced properly through a main dealer.

The main thing you’ll need to research is how much the services will cost individually as opposed to under a fixed-price servicing plan. In some cases, it could be more expensive to opt for a service plan whereas in others it may be cheaper. Just do a quick piece of research to see which works best for you.

You’ll also want to check what’s included – wear and tear items such as tyres and brakes won’t be included unless you opt for plan that does cover these.

Some plans – such as MINI’s TLC package – stay with the car and can be transferred to the next owner, whereas others do not. If you pay for a service plan and sell the car before it’s up, the money spent on it in advance will be lost.

Also, if you're buying a car on PCP (personal contract purchase), aim to get a service plan thrown in to ensure that the vehicle is worth as much as possible when it comes to the end of the finance term. 

Similar to

Service history, MOT

Looking for more jargon-busting motoring meanings? Head over to our Parkers Car Glossary page and take a look at our other definitions.