In Sept 2005 I bought a 2002 C320 Wagon on ebay from
eimports4less.com.

In the process Squaretrade offered me an Extended Warranty plan
("Gold Coverage Vehicle Service Contract"), which I bought for $2496.96.
In the paperwork somewhere on page 7 or 8 it is mentioned that
Warrantech is the actual insurance behind this extended warranty
contract. Squaretrade apparently just acts as a broker of sorts
selling these contracts.

The vehicle arrived here with 32000 miles on the odometer and I drove
it for just 9000 miles, because it burned more and more oil.
At 41000 miles an oil consumption test at a local Mercedes-Benz
Service Center concluded that the car burns 1 quart of engine oil per
570miles.

So I dropped of my vehicle at Mercedes-Benz of Laguna-Niguel to have
it fixed and asked them contact Warrantech for warranty coverage.
That was 9 weeks ago.
The reason for oil consumption for this excessive oil consumption was
determined to be scoring on the cylinder walls. So the engine showed high
wear even though the vehicle was maintained per factory schedule at Mercedes Benz.

Warrantech sent out an inspector as the diagnose work progressed,
Mercedes-Benz wrote 3 different estimates for the repair, $8.5k for an
engine rebuilt, $13k for a remanufactured engine, $21k for a factory
new replacement engine.

Warrantech said they would not cover these amounts, though the
Warranty clearly and above all covers the engine.
Warrantech´s "Senior Adjuster" Bill Belchar from Fort Worth, TX
handles this case and claimed that they, Warrantech, can supply a
cheaper replacement engine and thus have the repairs done for
about $6.5k. Accordingly that´s the maximum amount they cover.

Note:
Squaretrade Reps will tell you that your car under "their" (or better
Warrantechs) extended warranty will be repaired with NEW OEM parts.
Meanwhile in reality - as I found out in the process- - they only cover repairs
performed with salvage parts they gather from some junkyards and
salvage car recycling operations.

Nonetheless, I accepted Warrantechs offer because they give a 100k mile warranty on the replacement engine and promised to send a 100% tested and known-good engine.
They have ever since delivered two replacement engines (Mercedes Benz type M112), which both
were found to be defective at arrival by the MB Service Center:

1.) The first engine arrived without a cable tree and without an
intake manifold - I wonder how this got tested, then before shipping.
It was completed by MB, put in the car, ran at idle
for just two minutes, made clacking sounds and died.
Diagnose: no compression on 2 cylinders, wobbly crankshaft.
Damage beyond repair.

2.) The second engine arrived more complete from Warrantechs engine
supplier but had front-end damage. MB techs had to remove the engine
front covers (covering the timing chains) and found
a.) a damaged keyway on the driveshaft, so the crank dampener would
not fit on
b.) a damaged head gasket that would have resulted in a sizeable oil
leak. The gasket was ripped and looked like it didn't fit and somebody
drove a bolt through it with brute force. Bad.

MB has provided damage documentation + photographs.


Bottom line:
My vehicle is now in the shop for 9 weeks (!!!) and is still not
repaired, without any timeline for when it will be repaired again.
All this because Warrantech supplied two defective replacement engines
and they now try to weasel their way out somehow.

Conclusion:
I would never buy any Squaretrade or Warrantech Extended Warranty
again and can not recommend these services to anyone else.

Conclusion2:
I would never buy a Mercedes-Benz again, since their engines (V6, type M112) show a high failure rate at very low mileage - 41k in my case. MB quickly settled a class-action lawsuit back in 2002 covering M112-powered vehicles from 1998-2001 (M, C, E-class). A $36M settling was achieved in just days to end the lawsuit.
There plenty of webpages out there showing reports of troubled Benz owners.
See http://mercedes-benz-usa.com/, www.troublebenz.com,  etc

Thorsten,
tb@ieee.org


PS: Take a look at sites like http://www.ripoffreport.com/, search for 'Warrantech'.
You will find several people who have made similar experiences