Extended Warranties: Yes or No?

Wed Dec 12, 2007 9:49PM EST

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So you're shopping last minute and decide to be extra generous and buy the big-screen HDTV, or maybe the DSLR camera I've wanted for a long time...oops, sorry. That's not meant for you.

In the excitement of the moment, the store clerk begins to rattle off the extended warranty options he recommends for purchases like yours. Of course he does; that's how the store makes money on electronics that keep falling in price. Should you bite?

The short answer: no. Consumer advocates have long said most warranties are not worth the peace of mind they supposedly bring. You're buying an insurance policy to cover repair costs should the item break after the manufacturer's warranty ends. But Consumer Reports and PC World say tests of hundreds of products indicate more are reliable and fairly durable every year. And if they should need repair, the cost is often on par with what you've paid for the warranty, according to Consumer Reports.

You're better off spending the time researching which brands and models have performed best in consumer tests than spending extra dollars in a gamble that the one you choose will have problems.

When plasma and LCD HDTVs were new and the prices were sky high, Consumer Reports recommended opting for extended warranties because the technology was untested and the TVs cost so much. But the prices have dropped, and Consumer Reports' latest reader survey finds that in the last three years, HDTV owners report few problems with their TV sets.

So CR now recommends saying no to TV warranties. (The magazine makes one exception, advising consideration of extended warranties on rear-projection TVs, which are three times more likely to need repairs than other TVs.)

Meanwhile, J.D. Power & Associates' 2007 Major Home Appliance Survey of white goods such as dishwashers, ovens, and washers/dryers finds most so reliable that no warranties are recommended on those purchases either. In the first two years of ownership, one-tenth of owners report problems with their appliances. And most of those problems can be fixed by reading the manual or seeking help on the web.

This holiday season, your best bet may be to do what CR Senior Editor Tod Marks recommends: Put the money you would have spent on an added warranty in the bank so that you'll have it in case you need to repair your latest electronics purchase.

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  • 26 Posted by matt989s on Thu Sep 3, 2009 7:11PM EDT Report Abuse

    it depends on the item for sale yes i work in retail with this kinda stuff and items that actually have moving parts are definately recomended because they are more likely to break tvs and electronics are yes designed to last because why would you spend so much money on a tv or camera and have to buy a new one in 3 years

  • 27 Posted by defman69 on Thu Sep 3, 2009 3:40PM EDT Report Abuse

    Applecare is just as much a rip off as other extended plans. I worked for one of the applecare offices and the stuff that is covered by the parts plan that comes with apple products covers just as much as the applecare plan. Not only that, it doesnt even cover for accidents at all and if the repair is too expensive they deny the claim by saying the computer ipod or whatever arrived with "water damage" or suffered from "user abuse". Listen to the article and save your money.

  • 28 Posted by davey_boysju on Thu Sep 3, 2009 3:37PM EDT Report Abuse

    Generally I would agree you do not need to buy a warranty. But GE Monogram products must be the exception. I built a new home in 2003 and had all GE Monogram appliances installed. To date, I have replaced my refrigerator, microwave(magnatron died), motherboard for the dishwasher and numerous calls on the Professional range and second oven. In all, there has been numerous service calls (in the range of 50) by GE repair men. I finally broke down and bought warranties for the dishwasher, microwave and professional range. Good thing too, already have had over $500 dollars of work done to the Professional range and dishwasher since I bought the warranty. The only good thing I say about GE products since I have used them in the past, is there cheaper products(profile) perform better than the Monogram series.

  • 29 Posted by wolfdragon2172 on Thu Sep 3, 2009 10:49PM EDT Report Abuse

    I bought a LCD HDTV from Best Buy. I did a lot of research of the TV I was buying. But when they asked me for the Extended Warranty for the TV. I decided it would be in my best interest. Being that the technology is so new. So I went with the 4 year service agreement. Fast forward 2 years. It was a wise decision. My lamp on my TV went out. If I didn't have the warranty. It would have cost me between 280 to 350 dollars for the lamp for my TV. Thankfully I was still on the service plan. The lamp was replaced for free. But make sure if they offer a extended warranty that you understand what is covered and not covered also make sure you always keep any work documents that has been done to your product so that if something goes wrong again or even the same thing that has to be fixed. Most places will replace your product with the same purchase price you original payed for your product.

  • 30 Posted by wolfdragon2172 on Thu Sep 3, 2009 10:49PM EDT Report Abuse

    I bought a LCD HDTV from Best Buy. I did a lot of research of the TV I was buying. But when they asked me for the Extended Warranty for the TV. I decided it would be in my best interest. Being that the technology is so new. So I went with the 4 year service agreement. Fast forward 2 years. It was a wise decision. My lamp on my TV went out. If I didn't have the warranty. It would have cost me between 280 to 350 dollars for the lamp for my TV. Thankfully I was still on the service plan. The lamp was replaced for free. But make sure if they offer a extended warranty that you understand what is covered and not covered also make sure you always keep any work documents that has been done to your product so that if something goes wrong again or even the same thing that has to be fixed. Most places will replace your product with the same purchase price you original payed for your product.

  • 31 Posted by nate956 on Thu Sep 3, 2009 7:34PM EDT Report Abuse

    well see, some are worth it, take for example i bought a 1400 laptop almost 15 months ago and ive broken it 4 times and each time i have been able to take it back cost free to me. ethernet port crushed in from falling off bed, motherboard replaced, cost more than laptop worth, they gave me the option of picking out another laptop for equal value, then the new one got stepped on and the screen was cracked and it started to leak. again they stepped up and fixed it no cost to me. another instance where the plasma screen got damaged and again they replaced it for me. then the audio card started messing up on me and quit playing audio from the unit and they replaced the whole audio board. Unfortunatly it broke within a week of the return and then they offered to fix it and the replaced the keyboard assembly and audio board again. ALL FREE under best buys warranty program

  • 32 Posted by harbinger11 on Thu Sep 3, 2009 4:16PM EDT Report Abuse

    This article is ridiculous. If you financially invest thousands of dollars in home appliances or televisions or blu-ray players etc. the extended warranties are absolutely worth it every time. Has anyone heard 'better safe then sorry?' If you can't afford the warranty....should you really be purchasing something so extravagant that you can't afford the warranty? How can you afford the product if you can't afford the warranty??? I've never had problems with home appliances, but TVs, media players, videogame consoles....ALWAYS get the warranty as frequent use on home entertainment electronics leads to tons of problems.

  • 33 Posted by imalilred on Thu Sep 3, 2009 4:23PM EDT Report Abuse

    Certain types of items do warranty the purchase of an extended service agreement. I reccommend have it on some types of excercise equipment, and some types of electronic's like desk-tops, and laptops, elliptical's and treadmills. These items contain printed circuit boards that are subject to failure.

  • 34 Posted by lnbadger320 on Thu Sep 3, 2009 6:55PM EDT Report Abuse

    i've 2 video cameras in two year because they broke, they were canon brand, if i had the warrenty i would not have had to buy the 2nd one. i promise you this, if i have an extended warrenty on electronics, it will break before the warrenty is up and my chances will be pretty good that they'll have to replace it with something in a similar price range. i know it does scare me paying 2500-3500 for something and it breaking 3yrs from now,

  • 35 Posted by imablueslover on Thu Sep 3, 2009 4:23PM EDT Report Abuse

    I will continue to use extended warranties . I passed on one on a laptop and the hard drive quit just out of warranty . It cost me $370 for a single repair when I could have been set for 3 years for $200 with unlimited repairs and tech info . Like a car insurance , you hate paying for it but when you need it , it is wonderful to have

  • 36 Posted by flatusm on Thu Sep 3, 2009 4:00PM EDT Report Abuse

    Laptop computers are one thing for which you should probably get the extended warranty. There are too many things that can go wrong, and they are very hard to repair, so the store will typically give you a new computer which will probably be an improved model. If you keep an external hard drive with a backup, it's all good.

  • 37 Posted by defman69 on Thu Sep 3, 2009 3:40PM EDT Report Abuse

    All these guys in here posting about how great these plans are more likely than not sell the plans for a living. Of course they want you to know "most plans are bogus but not this one" the unwritten text is (because I sell it)

  • 38 Posted by jayjobes2 on Thu Sep 3, 2009 4:29PM EDT Report Abuse

    Think about the big picture. Add up all the $$ you would spend if you bought extended warranties on everything that they are offered. Now, look at how many times you would actually use that warranty and do the math. They simply do not make good financial sense. Even if they would have saved me $2000 one time, it is still cheaper just to pay that $2000 and replace the item than to buy all those warranties.

  • 39 Posted by eabradfo on Thu Sep 3, 2009 3:50PM EDT Report Abuse

    My mom always told me I was wasting my money on extended warranties, so about 5 years ago, I bought a DVD player that was a bit expensive. I ended up not buying an extended warranty for it b/c mom voice kept playing in my head about wasting money, but the 4 yr warranty was only something like $60. After 3.5 years, it broke and needed repair, but the repair would have cost over $100. Thankfully by then the price of DVD players had fallen drastically and I was able to purchase a new one that has been quite good. Generally it's the case you are wasting money buying extended warranties, I mean after all I think it's murphey's law that things will break when the warranty ends, but at the same time, I prefer the piece of mind knowing it's protected for 3 or 4 years.

  • 41 Posted by l_dempsey23 on Thu Sep 3, 2009 7:01PM EDT Report Abuse

    I think that extened warranties are a good thing. You never know what might happen. Also, some plans will cover accidental damages caused by the consumer. In some cases, you are charged three times as much for the labor as the parts acutually cost. Just ask any one who turned down a warranty. If something happened, they are now S.O.L. Better to be safe than sorry.

  • 42 Posted by h20lilypad@sbcglobal.net on Thu Sep 3, 2009 4:15PM EDT Report Abuse

    I bought a digital camara ....first day i had it i dropped it ...broke the screen....fortunatly i had 30 days to decide on a extended warranty..thank you God ...it was a $400.00 dollar camara {On sale!} WARRANTY A MUST FOR DIGITAL SCREEN CAMARA'S!

  • 43 Posted by kgeil123 on Thu Sep 3, 2009 4:50PM EDT Report Abuse

    all good ideas but i suggest finding out what a warrenty cover ie i recently bought a digital video camaer and it had a warranty offer that covers accidentals like if it were to be droped and broke it would be replaced for free and if you have kids you may want to think twice about saying no to a warrenty on thTat type of purhase but on tvs the are unnessacasary computers you are better off getting a viruse protection because you are only covered for 30 days no matter what the sales person say

  • 44 Posted by m_panebianco on Thu Sep 3, 2009 7:32PM EDT Report Abuse

    I agree with this article that most extended warranties are just that; that a warranty is just something that says the product is free from defects out of the box and that the product will be warrantied from defects for a certain amount of time. However, some places like Wolf Camera do offer damage protection on almost all products they sell. This damage protection will cover everything except theft and fire; damaged product, camera dropped in sand/water, bring it back (serial number has to be on product) and it will be repaired or replaced; provided that you bought the damage protection at the same time of purchase.

  • 45 Posted by rocket6611 on Thu Sep 3, 2009 8:47PM EDT Report Abuse

    I have been in the consumer electronics industry for almost twenty three years. I was never much of a believer in extended warranties. I have however begun to offer my customers extended warranties on more expensive panels. I have no idea what area of the country CR did their research, but I can tell you where I live it is quite expensive just to have a repair tech come to your home. Manufacturers warranties do not cover removing the panel from the wall, surges or power issues that occur. There are also a lot of second tier brand LCD panels and plasma's on the market that have very poor warranties. My advice is to buy from a specialty retailer that will explain everything to you. You will not pay more and you will get great service a support.

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