Think About Getting an Extended Warranty? Read This First

Any new appliance you buy should be protected by a manufacturer’s warranty for the next 6-12 months. However, you expect this item to serve you for far longer, so it will require more protection. An extended warranty might seem like the best choice in this situation, but you shouldn’t rush to buy it. First, you need to understand the limitations of these policies as well as learn what alternatives can be more beneficial to you in the long run.

What Exactly Do Various Electronic Appliance Warranties Cover?

All electronic products you buy new must be protected by a manufacturer’s warranty. Regardless of what the appliance is, the terms of the warranty are nearly the same. The main point of these policies is that the manufacturer will fix any issues caused by the product’s inherent defects free of charge. If the repair is impossible, the manufacturer will replace the product.

Focus on the “product’s defects” part because no other issues are covered. Therefore, if it breaks down due to incorrect handling, bad installation, or any other issue, you will be paying for the repairs out of pocket.

Now, here comes the main appealing factor of extended warranties, usually offered by the retailers themselves. These policies will cover you in a variety of cases, including some types of damage not caused by the actual defects of the device.

You can learn more by studying the extended warranty policy offered by Walmart or CPS. These policies are rather similar to a manufacturer’s warranty. However, they also protect you in case of damage caused by the user, like dropping your phone or having your appliances damaged by power jumps.

 Note that you shouldn’t mistake a warranty for insurance. And before you start saying that insurance policies are about protecting lives and homes, you should know that today you can find an insurance policy for everything, up to and including smartphones.

These policies will cover some types of damage, but their main focus is on protecting you in case your device gets lost or stolen. Warranties, on the other hand, will protect you in case your appliance breaks down due to some tech issues.

Therefore, to get ultimate protection, you’ll need both. And you shouldn’t forget that there are also home warranties that offer similar protection but for all your devices instead of one. All in all, to develop the best kind of protection for your electronic products, you’ll need to carry out a comprehensive research about appliance warranties. You should consider the pros and cons of each option and decide what will be the most beneficial for you in the long run.

Extended & Manufacturer & Home Warranties: Pros and Cons

Both manufacturer’s and extended warranties have similar advantages and disadvantages. Their main benefit is that they protect you in case the device breaks down and ultimately cover the cost of repair or replacement. Extended warranties allow for more eventualities, thus they can be considered a better option in this case.

However, in either case, you need to understand that any repairs will be carried out only by contractors that work directly with the company that issued the warranty. In the case of a manufacturer’s warranty, you will only be able to get your appliance repaired in authorized service centers.

As these are few and far in between, for you as a consumer this means the following:

Long waiting times as specialized service centers are usually loaded with work.

Possible need to ship your damaged device to a different city, which means you’ll have to wait even longer.

Subpar customer service quality as these contractors are rarely courteous and friendly.

If you use an extended warranty from the retailer, you’ll face all the same problems. However, you might avoid customer service issues as you’ll be dealing with the local retailer office. On the other hand, the contractors doing the actual work on the company’s behalf might not be very good at what they do. That’s because they don’t have to go through extensive testing and training to become an authorized service center.

As to home warranties, they offer a great advantage of covering a variety of appliances and home systems in a single plan. Therefore, you won’t have to deal with a dozen of extended warranty plans. You can also buy a home appliance warranty at any time, as opposed to an extended warranty policy that can only be purchased not long after buying the device.

However, both extended and home warranty plans have one thing in common. Their cost over time will be more than actual maintenance would have cost you. But it’s the same situation as with the homeowner’s insurance, meaning that the warranty will help you save a great deal in case of a major breakdown. This is what you are paying for by buying such a policy. You protect yourself from a huge expense in case of an emergency.

Indeed, this kind of emergency might not happen in your lifetime. But what if it does? These policies make sure that if that happens, you won’t be left paying a huge bill.

How to Stay Safe After the Manufacturer’s Warranty Expires

So, the manufacturer’s warranty is nice, but it will expire eventually, and then, you’ll need to think about how to protect your electronic appliances. The choice boils down to deciding between an extended and a home warranty plan.

This should be a simple matter to decide because you are, in essence, making a choice between buying one policy, which costs about $400-$600 a year, and multiple plans of varying costs. Therefore, unless you are willing to deal with the headaches brought on by having multiple points of contact for every issue with every appliance, the decision is clear.

However, you shouldn’t forget that despite some significant advantages, home warranties aren’t perfect. In fact, choosing the wrong kind of plan can bring you a huge disappointment. To avoid this, you should do the following:

Research home warranty providers through independent reviews.

This way you can get an unbiased professional opinion about every company’s strengths and weaknesses.

Study consumer reviews posted on platforms like Yelp and Google Reviews.

These will tell you more about how the company treats its customers. However, you should always take personal opinions with a pinch of salt.

Study the contract thoroughly.

It’s essential to go through every sentence of the plan and Terms and Conditions offered by the company so you can understand exactly what gets covered. If you need to protect expensive appliances, make sure that the plan includes common breakdowns and replacements of their weakest parts. Take note of the service fee and claim to file time limits.

Check how reasonable the coverage limit is.

A home warranty policy will always have a cap limit to how much the company will actually pay for the repair, with the rest going out of your pocket. Use websites like homeadvisor.com to determine how much appliance repair will actually cost so you can understand if that limit is enough.

Home warranty plans vary greatly, so you should always shop around and compare plans available to you. Bear in mind that you should only stick to reputed providers that have been active for a while as these are the most trustworthy.

But note that these plans only work out well for protecting reasonably new appliances in good condition. The best case scenario is to get a home warranty after you upgrade your property so it can add a layer of protection immediately. The condition of your appliances and home systems will determine the cost of your plan.

And keep in mind that if you plan to sell your property down the line, you can sell the warranty plan as well. It might even help you get a better deal and home warranties make the house appear “safer” for prospective buyers. This is another point in favor of these policies as opposed to extended warranties as those are rarely transferable. Also, trying to transfer a dozen policies for every appliance you choose to leave behind will add a lot of paperwork to any real estate deal.

Final Thoughts on Home Warranties: Not Perfect, But Efficient

Home warranties are, by no means, perfect, but no protection policy is. Investing in this kind of coverage means you are looking into the future. One can never know when and if an emergency occurs. That’s why we use insurance policies that offer some help in case of disease or natural disaster.

Warranty plans are a lot like that, although they protect you from spending a lot of money on emergency repairs. And it’s true that you might never use that kind of service, but you’ll always be secure in the knowledge that it’s there to serve you as needed.

Extended warranties, have all the same limitations but are also restricted to a plan per item. This means that not only are they more expensive in total but also rather bothersome to manage. Therefore, if you want to protect your home systems and appliances with some kind of plan, you should consider going with the one that provides more comprehensive coverage.