When purchasing products such as a new home appliance or an electronic gadget, sellers sometimes offer consumers the option to buy an extended warranty. These warranties are not always as beneficial as they seem, and consumers may end up paying extra for a protection they already have.
What is an extended warranty?
An extended warranty is a prolonged protection on the product purchased that gives consumers the right to claim a free remedy from the guarantor in the event of defects, after the standard commercial and legal guarantee expires. For this additional protection, consumers are requested to pay an extra amount of money.
Before deciding whether or not to buy this guarantee, consumers should determine whether such a purchase actually provides added value. So the question to ask is: what are the real benefits the extended guarantee provides?
To answer this question, consumers must take a close look at the guarantee’s terms and conditions. While the length of the guarantee is important, it is more important to look for and understand the real benefits the guarantee provides.
There are guarantees that only cover mechanical breakdowns of certain parts and specifically exclude other parts considered as consumables. Furthermore, damages caused by normal wear and tear as well as accidental damages are often excluded by such guarantees. In such cases, consumers should carefully evaluate the usefulness of such a guarantee. If the possibility of using the extended guarantee is quite remote, then it might not be worth its price.
The choice of remedies that the extended warranty offers are also worth considering. Does it offer new for old, or only repair or replacement of the defective part?
Furthermore, in case of repairs, consumers should also check whether the labour cost of replacing the faulty part is covered by the extended warranty. If not, one should ask what are the applicable rates.
Consumers should also check if there are any additional costs involved in using the guarantee, such as transport costs or call-out charges.
Another important factor is the cost of the extended warranty in comparison to the value of the good purchased. An extended guarantee is usually worth its price if the product it covers is very expensive to repair or replace.
Shop around for a better deal
Consumers should be aware that on the market they can find different products with different standard commercial guarantees. This means that while a brand may offer a standard guarantee for two years, another brand may give a five-year standard guarantee.
An extended guarantee is usually worth its price if the product it covers is very expensive to repair or replace
It is then up to consumers to compare different products to find the best deal. When carrying out these comparisons, consumers may discover products with standard guarantees that provide the same benefits as the extended guarantee that some sellers are requesting extra payment for.
Consumers’ legal rights
Consumer legislation provides a two-year legal protection on goods purchased by consumers from traders. This protection gives consumers the right to claim a free remedy when products either develop a defect or do not conform to the contract of sale. These remedies include free of charge repair or replacement.
When these remedies are not possible, or if opted for may cause a significant inconvenience to consumers, then a part or full refund of the money paid may be requested.
These rights should be kept in mind when considering buying an extended warranty to ensure that the latter actually provides more protection than that established at law.
Extended warranty check list
• Make sure you are given a copy of the extended guarantee’s terms and conditions in writing.
• Check if there are any extra costs involved in claiming a remedy through the extended warranty.
• Make sure the guarantee includes the contact details of the company or individual responsible for the guarantee.
• Remember that terms and conditions cannot change once an extended guarantee is purchased.
• If you have an extended warranty but the seller is refusing to abide by its terms and conditions, you may file a complaint with the Office for Consumer Affairs to assist you obtain the remedy you are entitled to.
Odette Vella, Director, Information and Research Directorate