Extended Warranty.Yea or Nay?

Mike Kennedy · Sep 16, 2009

I just picked up a 20" Samsung LED monitor for 150 bones.Before I even had my wallet out the salesman offered the "5 year extended warranty package"..........for another 50 bucks.
Are these options worth the money?

Larry.Manuel · Sep 16, 2009

Postulate this: In 3 years, likely you could buy something just as good for 100 bones. I've used those warranties at Radio Shack on things like headphones that seem delicate and have a tough life. I don't think of monitors as failing very often.

bobwysiwyg · Sep 16, 2009

No. Electronics are pretty reliable and if they fail, they tend to early on. This is a money making scam. I never take them. Try Googling, I think you will find the same sort of information.

alexmacphee · Sep 16, 2009

Almost invariably not. Dealers push these extended warranty insurance policies because they often make more profit on the policy than on the item it covers. Obviously I don't know consumer law as it applies where you are, but in the UK consumer protection legislation is fairly strong anyway. You could take out a whole slew of these policies for different consumer items, and it would generally cost you more than if you'd assumed that one of these items would fail and merely paid the replacement yourself.

I was recently invited to pay GBP 15 for an extended warranty on a lamp standard that cost GBP 30, where the only possible fault would be the failure of the bulb in the socket. I just decline these with a smile.

Roger Thoms · Sep 16, 2009

I don't buy extended warranties. In the long run I feel it is much cheaper to simply pay for the repair or replacement of the item if it breaks. Most things I buy are good quality and quite reliable. I have saved thousands of dollars over the years.

Roger

MattKing · Sep 16, 2009

I'm much more positive about extended warranties for larger, less portable items. We recently purchased a new washer and dryer, and the extended warranty for the two of them (up to 5 years) was less than 15% of the new purchase price, and probably less than one service call.

The fact that the extended warranties are based on the purchase price also means that if you get a really good deal on an item, the extended warranty may make more sense. I recently purchased a new laser printer/scanner/copier at a greatly reduced (50% off) price. The extended warranty was less than $20.00, and a regular priced replacement machine would be over $200.00, so again the warranty made some sense.

So for me, the answer is "it depends".

Matt

MikeSeb · Sep 16, 2009

railwayman3 · Sep 16, 2009

A definite "No" here.

Modern electronics are so reliable that, with normal care and use, it is very unlikely that you will have any problems, certainly within the five years of the extended warrenty.

And you are relying on the warrenty company still being in business if you did need to claim...there have been problems in this respect, certainly in the UK.

I'd just keep your $50 in the bank towards the cost of any eventual repair/replacement, chances are that it will still be there at the end of the 5 years.

DWThomas · Sep 16, 2009

Nay Most electronic stuff that fails goes in the "infant mortality" stage or else after a long, long time of use. The normal warranty should cover the infant mortality problem, and by the time the end of life stuff hits, you'll have been looking for an excuse to replace it anyway.

DaveT

benjiboy · Sep 16, 2009

Don't buy the warranty mike there a rip off, I used to sell them I know,unless you can screw them to throw it in with the price, it costs then very little. The last time I bought a dvd recorder the salesman offered me an extended five year warranty, I told him that I'm seventy and that I would be happy to pay for it , if he could guarantee I would be alive to claim for the full warranty period, the guy shut up very quickly.

bdial · Sep 16, 2009

The odds are in your favor that you won't need the extended warranty.

L Gebhardt · Sep 16, 2009

I would vote no on a monitor. I think they sometimes make sense on laptops, depending on the cost. I got one on my Mac Pro because they dropped the price down to $50. At that price it seemed worth it to me, though even then I bet I wasted my money. We will see in 3 years.

Chan Tran · Sep 16, 2009

The odds are in the guy who sells the warranty favor. He knows that the chance of having to pay for any repair is a lot less than the money he makes by selling you the warranty.

mgb74 · Sep 16, 2009

First, some credit cards (such as many AMEX cards) automatically extend the warranty.

Statistically speaking these warranties are not good deals. But you have to also look at the item and your usage. If it's unusually complex or relatively new, it may be worth it. For a monitor, not likely.

Anscojohn · Sep 16, 2009

Mike Kennedy said:
I just picked up a 20" Samsung LED monitor for 150 bones.Before I even had my wallet out the salesman offered the "5 year extended warranty package"..........for another 50 bucks.
Are these options worth the money?

******The extended warranties are heavilly spiffed. If you have the cash, help the sales person out. With cameras, computers, other such, if you are going to have trouble, it will almost always be during the manu warranty, as others have said.

Paul Jenkin · Sep 17, 2009

Speaking as someone who has worked in the insurance profession in the UK for the last 30 years, I would say 'maybe'.

Most policies cover you for physical loss and damage - fire, storm, flood, theft, accidental damage, etc. The warranties you're referring to cover breakdown - usually electrical or mechanical. There are exclusions and, often on larger items, there'll be a requirement that the item will need to be subject to a regular preventative maintenance programme. Cover might only extend as far as 'negligent breakdown' - i.e. that which falls outside of what would be covered by a preventative maintenance programme.

It's certainly true that many of the products sold through hight street retailers carry massive commission levels and sales target inducements and you can always haggle. Sometimes it's easier getting a few quid off the breakdown cover than it is off the item itself.

Don't dismiss them out of hand but do shop around as the cost of the item you're buying might be cheaper somewhere else and enable you to afford the warranty. If you're talking about a very expensive piece of technology, as yourself what you'd do if it failed the day after the manufacturer's warranty expired.

Although I don't deal with personal homecover policies, it wouldn't be a big leap to imagine this cover one day becoming a standard feature in those policies and covering all of the stuff in your home.

Slixtiesix · Sep 17, 2009

Last summer my Benq TFT smoked off. It was only 2 1/2 years old, slightly more than the 2 years warranty. Frustrated about this, I ended up buying an Eizo as replacement, which comes with a 5-year warranty from the factory (at least here in Germany). I just wanted to mention this as an example for a TFT display that died earlier than I would have expected. Nevertheless I would not buy an expensive warranty extension that is 1/3 of the new price for something whatever it may be. I think you have done just right.
Best regards, Benjamin

Anscojohn · Sep 17, 2009

Slixtiesix said:
Last summer my Benq TFT smoked off. It was only 2 1/2 years old, slightly more than the 2 years warranty. Frustrated about this, I ended up buying an Eizo as replacement, which comes with a 5-year warranty from the factory (at least here in Germany). I just wanted to mention this as an example for a TFT display that died earlier than I would have expected. Nevertheless I would not buy an expensive warranty extension that is 1/3 of the new price for something whatever it may be. I think you have done just right.

*******
What is a TFT?

alexmacphee · Sep 17, 2009

As with most things, it's a judgement call, though my own judgement has been that it's rarely worth it. In the UK at least, the manufacturer's warranty is not all that covers the goods, so the prospect that it may fail the day after the manufacturer's warranty expires is not in itself reason enough to buy an extended warranty. Whilst it's not precise, in UK law goods have to last a reasonable amount of time, and one is still entitled to redress even outside the manufacturer's warranty period, which is why warranties in the UK carry a notice advising the buyer that the warranty is in addition to, and does not affect, your rights under consumer legislation. If the extended warranty is a small enough proportion of the price of an item that you expect to have a long service life -- for example a washing machine as opposed to a mobile phone (to choose non-photographic examples!) -- then you may think it worth it for the peace of mind.

I took out a similar sort of policy for household appliances, through our energy supplier at the time. They kept pressing us to 'upgrade' the policy every so often. Eventually, we were paying them GBP 650 a year, more than our house buildings and contents and photographic insurance combined. For reasons that are too off-topic for here (they were unable to identify and repair a fault that persisted for three years), we cancelled the policy, and received the rudest and most impertinent telephone treatment we've ever had from any service organisation.

Stan160 · Sep 17, 2009

In the UK, the Sale of Goods act covers consumer goods up to 6 years old for any failure that was either caused by a defect present when the item was bought new, or which emerged during its lifetime and not caused by unreasonable wear and tear. The responsibility to make good is with the retailer not the manufacturer, and the burden is on them to prove that the problem was caused by unreasonable treatment.

Only time I've paid for an extended warranty is for a non-analogue SLR, and that was only because the warranty covered accidental damage and theft as well as break down. This was five years ago when the replacement would have cost £800 and they were a lot less common and therefore more attractive to thieves.

Ian

Nick Zentena · Sep 17, 2009

Nay. Odds are even if you needed it the paperwork would be lost. Or worse some companies make it very hard to collect. They are happy to take your money but count on not providing the warranty service.

Mike1234 · Sep 17, 2009

I have bought exactly ONE extended warranty and that was because the Samsung rear projection TV was an open floor model at a deep discount. Although it came with a full warranty I opted to pay another $200+. Come to think of it... it's about time to replace that $200 lamp...

Sirius Glass · Sep 17, 2009

DWThomas said:
Nay Most electronic stuff that fails goes in the "infant mortality" stage or else after a long, long time of use. The normal warranty should cover the infant mortality problem, and by the time the end of life stuff hits, you'll have been looking for an excuse to replace it anyway.

DaveT

What he said. Absolutely right. Consumers Reports strongly advises against these warentees.

Steve

mark · Sep 17, 2009

Depends

We deal with etended warranty stuff all the time in the marine industry. Granted, boats get used a lot more energetically than a camera and the average minor repair bill for our shop was over $600US. Lots of people had extended warranties. SOme were "bought from the company". (Mercury Volvo, BRP, etc...) None of the bought from the company warranties were actually through the manufacturer. It was a third party who pays a hefty fee to use the name. Most manufacturer extended warranties are like this. A little over half of the extended warranties payed out real easy and were nice to work with. others were a bear. Some good, some bad. How useful the extended warranty is depends on the nature of your product usage. In the words of a female warranty rep for Mercury Marine we deal with on a regular basis-"if you handle your product like a teen age boy in the back of a car for the first time, get the warranty with good insurance".

Warranty will pick up parts worn out from heavy use but tend to last longer than the one or two year warranty, while insurance will take care of your nervous backseat bumbling.

maciekz · Sep 17, 2009

In my opinion they are usually no good, with one simple exception: if you buy something so costly that you'd have no money to replace it within the extended warranty period. Then it MAY be worth analyzing if paying a few $$$ extra is worth it.

Extended Warranty.Yea or Nay?

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