What's the point of an extended warranty?

If an 'extended warranty' does not cover wear and tear replacement, then what does it cover on a 12-year-old car and is there any point in me paying for this warranty?

Asked on 6 September 2012 by RB, via email

Answered by Honest John
Warranties never cover tyres, brake pads, brake discs, clutches, timing belts or ancillary belts because these are all parts expected to wear and need to be replaced. A water pump, an alternator, a power steering pump or a gearbox are not wearing parts, so these would normally be covered, but what is covered and what is not reduces as the car becomes older, making a warranty on a 12-year-old car of limited value anyway.
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