Community poll forum: Are extended warranties worth it?

Those nice little displays on PDA's can burn out without notice. And built-in batteries can fail as well. I find that for the usually not-too-expensive extra, it is well worth the money. I had to return an MP3 player after the screen burned, and got a brand-new one with no hassle, and no "ship it in for evaluation" to the manufacturer. Certainly, you don't have to buy the package, but then you are left with having to give the unit up, do without for whatever time it takes. My Creative Labs MP3 player was a bear to deal with, butbeing able to get a quick replacement was well worth it.

I would agree with you that most retail store warranties aren't that good, but depending upon the failure rate of the product, the conditions of the warranty, how you use the product, the cost of the product and the cost of the warranty it may be worth it.

You are absolutely right that most people don't read the fine print. Unless the company is committing fraud they are worth exactly what the paper says they are worth nothing more and nothing less. Unless you have it in writing I would be skeptical of any claims that a warranty covers data recovery or software troubleshooting.

The people who are most likely to buy them are the people that are least likely to put the wear and tear that would cause components to wear out. Furthermore most noobs buy them on proven technology as opposed to cutting edge stuff where the reliability is less known.

On desktops though you are absolutely correct. The newer chips run cooler and hence are significantly less likely to overheat. Heat is one of the biggest killer of hardware. Poor airflow was more likely to fry the processor or other components back on the now defunct Pentium IVs. The newer Core2s use far less watts which generates less heat. Hence, the failure rates have definitely fallen. More importantly repairs on desktops tend to be much cheaper. The parts are cheaper and easier to acquire and far more people have the capability to repair a laptop.

The vast majority of warranty plans don't make sense, but there are some cases like refurbs or laptops where they might make sense.

It seems to me that you have had more than your share of problems with electronic devices. Power surges can cause them to fail prematurely, and they may also behave strangely.

My daughter lived in a nearly new apartment building located near a factory. At the same time each weekday evening, her stereo system would turn itself on. What caused it? A huge power surge in the lines at the end of the factory shift each day.

Have you considered checking your home's wiring? Perhaps an inexpensive whole-house surge protector would be a better buy than an extended warranty! At between $50 and $500, it's cheap insurance.

The best warranties I have seen are offered by Walmart which begin after the manufactuer warranty expires. And are sold at a very reasonable price.

I normally don't buy extended warranties. If a product (like a computer) fails it's usually within the manufacuters warranty time. However, I purchased a treadmill many years ago from Sears. In a fit of weakness, I purchased the extended warranty. Over time the treadmill "runner" got off center and cracked the base unit rendering it unusable. It sat in the garage waiting to be taken to the dumps. Last year, I was cleaning out drawers and found the old extended warranty that still had ONE WEEK left. I called Sears, they came out and provided a brand new "runner", base unit, and checked all the functions. Bottom line is that I now have a like new treadmill (that I promise I will use shortly....)

I have found that when ever I had bought into one the item did not go out until one month after the end of the warranty usually speaking. Also due to the fast moving pace of monitors, tv's and home theater systems and the fact that the cost of these items are becoming more affordable it only makes sense to up grade your system periodically. Point of fact is that I gave my IBM Desktop to my sister in law about four years ago after upgrading to a gateway and she still has it and it still works. It has the original monitor, mother board, graphics card, power unit and drives. I owned the IBM for seven years prior to giving it to her which means the electrical items are way out of warranty and still going strong.

As Always

Dave White

Some warranties out there now allow for an in-store credit if you don't use it, so that may be worth it in the long run. I got the extended warranty on my LCD screen, which I think I regret, but we'll see in 3 years how it's holding up. I always get it on my fridge and washing machine though, and I have had a fridge go bad on me, which was fixed and a small credit given to me because of the lost food, so that was a good purchase.

First of all, you need to understand the failure mechanisms of the specific device.

Purely electronic devices with no fragile parts will exhibit an elevated infant mortality rate, then level off to long-term reliability well within the standard warranty period. For such devices, extended warranties are a waste of money.

Devices with fragile pieces (e.g. LCD displays, key switches) may be good candidates for extended warranties if their repair or replacement cost is significant.

Devices with electromechanical components (e.g. disk drives, tape units) are usually worth the extra cost unless they're cheap enough to be considered disposable.

Finally, a lot depends on the manufacturer. For example, Sony's repair costs are so high, I'd never buy any Sony product without an extended warranty. When a Sony product breaks, if you don't have a warranty on it, you pretty much have no choice but to throw it away since the repair cost typically exceeds the replacement cost.

I have bought them from time to time, depending on the product. Laptop? yes usually. Desktop computer? no. My son's gameboy? yes, cause my son will probably break it in a week. A washing machine? no. An accoustic guitar for my son? yes, see above. So it depends. You really can not be blind-sided by the question at this point though. When you are researching what you are going to buy and from whom, decided if the extra warrantee is necessary at that time. That way you have the answer when the question comes.

In the 1960's when extended warranties first came in over here in the UK I was an insurance broker who set these schemes up as insurance policies at Lloyd's. In those days we were charging premiums of 4 ($2US) and the clients were charging their customers between 20 and 40. Everybody loved it because there was so much money in it because of the very low risk involved.
As with any insurance there is a risk inherent in the transaction and we have all regretted not taking out the cover at some stage.
However, given the figures I have quoted, which I don't think have changed much over the years (allowing for inflation), it is probably a good idea to do something - but why not carry the risk yourself spread over all of the items you buy. Even $10 an item set aside should go a long way to covering it and you are still very much in pocket compared with open market prices.

On a DVD player or something a couple hundred, FORGET IT! They are usually a rip off. Now, I recently bought a MacBook Pro which cost me $2500. I bought the extended warranty because it will be going a lot of places and vibrations and things can ware out a computer fast. For $250, it can easily cover the cost of a repair so I figured for 10% of the retail price, I better get it to be safe. I recommend extended warranties for thing $1000 and up.

For instance if you are buying a new technology product prone to failure but you need that product then depending on the cost of the coverage and if the company producing the product is providing the coverage, then possibly yes.

Or the same product but the extended warranty is with another specialty extended, known crappy service, company like so many of them out there, then No.

And if the product is tried and true, has a reasonable track record and especially if the extended warranty company is a 3rd party specialty extended warranty company, then absolutely No.

I look at this way, I have saved hundreds (if not thousands) of dollars by not buying these warranties over the past 10 - 15 years. If by chance one or two of those products fails, the repair costs would still not exceed what I have saved. Just think back to all of the items that you have bought or will buy in the future, and think what you would have spent on the extended warranties.

Your Basically betting that you've just bought crap. While the retailer, is gambling that his products are better than a basic warranty. If you play this game its a suckers bet. I tell every salesman who tries to push an extended warranty on some item that if they really believe I'll need it. Then I'll go buy something else somewhere else. Where the sales staff is sure the product can work beyond the average life span. Lets face it, only a small percentage of products ever prematurely die. Why else would stores sell such warranties to begin with? Their making big bucks on these, its gonna break warranties, as I see it.

My experience has usually been that the product goes bad just after the warranty expiration date! - Honest!