Extended Warranties, are they worth the price?

Submitted by mega on Fri, 01/25/2008 - 14:33

Seems today no matter what you purchase from steam irons at your local K-mart to automobiles from your local dealer everyone has some type of "extended warranty" they try to sell you at check out.

An extended warranty is a type of "insurance" that is supposed to give you assurance that if something goes wrong with your purchase after the original manufactures warranty has expired. But do they do what they suggest they will do and if so are they worth the prices.

I guess this subject is open to debate and I guess there are times when these type of insurance is good. But one must weigh the price and coverage very closely and read the fine print before purchasing. Often times if it is a small item purchased at a local store, the cost of shipping to get the item repaired combined with the cost of the warranty would be more than replacing with a new one.

With automobiles you really do need to understand what warranty covers because many dealer will charge up to $1000 or more for an extra 36 months coverage. But it is not a bumper to bumper.

I would be interested in hearing some experiences both pro and con on extended warranties.

Posted: 26 Jan 2008 12:10 Post Subject:

The ones that kill me are on appliances for example and the salesperson will tout, ''if lightening runs in on it we will cover it!'' , dude, so does my homeowners, so why do I need it? Punk 20 year old kid actually argued with me that homeowners policys didn't cover this....Told him I was handling those types of claims before he was born! Man, that kid ticked me off! Clearly he got a commission on these warranties, which I brought to his attention.... I bought an extended warranty ONCE on an appliance and it wasn't worth half what I paid for it....As you said you really need to KNOW for certain by reading the warranty NOT by what the sales person says that it covers. THEN AND ONLY THEN decide if it's a good plan for you.

Posted: 26 Jan 2008 02:00 Post Subject: I think so too especially on the small appliances, however

there was one thing that I forgot to mention about the extended warranties on auto's. Most of the major companies extended plan are transferable if you sell the vehicle yourself for about $25 bucks. So often times this can help you get a better price if selling the auto yourself.

Now on trade-in that's a different story. Really doesn't matter about extended warranty.

Posted: 28 Jan 2008 06:59 Post Subject:

The extended warranty may help if you intend to make a long term investment. But in present days electrical appliances have a very short life span and unlike the first breed of electrical goods, they are made with very cheap parts. Therefore, purchasing an extended warranty may not benefit you.

Posted: 30 Jan 2008 01:53 Post Subject: I agree

extended warranties are often times not worth the price but I agree for an opposite reason. The life-span of most products seem to me to outlive the worth of an extended warranty. For instance I just had to replace a refrigerator. The one I replaced was about 17 yrs old. The new one was roughly $750 bucks. So I figured that old fridge outlived a couple of extended warranties. However at the price Sears and some of the other's charge for these things, after a couple time you could just about purchase a new one.

On the other hand if I thought this new fridge would not last 3 years, then yes it probably would have benefited me to purchase the extra warranty. It came with 90 days everything, then the remainder of the year on parts. The extended warranty on this would have been $165.00 to extend it for 12 more months on parts and (1) service call.

So I guess I'm gambling that it will last 5 yrs.

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