Update: See our top 5 Appliance Insurance policy reviews and find out how you cover your white goods and gadgets for less than the cost of a cup of coffee every month!
When you buy an appliance, TV, phone or virtually any other type of product, that product is typically covered for a minimal amount of time (usually, it seems, until the day before trouble starts).
At the time of purchase, however, you are usually given the option to purchase an extended warranty. Many people who have experienced appliances breaking down a week after the warranty expires are all too happy to sign up. But are extended warranties actually worth the money or are they, as armies of internet sceptics claim, just a cynical trick on behalf of manufacturers to siphon more money from your bank account?
What is an Extended Warranty?
It’s hard to fathom today but until well into the post war period warranties were a rare commodity indeed. It wasn’t until consumer culture began to take hold during the 1950s in fact that people began to make noise about manufacturers not standing behind the products they were selling.
As a result, governments in most developed nations began to enact legislation to protect buyers (or consumers as they were increasingly being called) from unscrupulous manufacturers. Another reason driving the push toward enforceable warranties was the ever-increasing number of product litigations.
Since consumers had no warranty to invoke they were instead suing companies directly, overwhelming the court systems of many countries with liability claims.
Today, warranties are a given and most every product is covered for a certain minimum period of time against defects. In Europe much is made of the mandatory 2 year warranty rule but this regulation is often overridden by the laws of individual countries, such as the Sale of Goods Act in the UK.
Extended warranties first came into widespread use during the 1980s. Ever since, a lively debate has ensued between proponents of this type of extended protection and those that feel it is a waste of time and money. But does the extended warranty deserve the bad press it frequently gets or is that bad press simply a function of website owners needing something to write about?
Do you Need an Extended Warranty?
Let’s cut right to the chase and ask the most important question first. Do you need an extended warranty? It would be great if there were a clear cut answer in to this question, but like most things in life the issue comes down to a combination of circumstance, preference and most of all, product.
In some circumstances an extended warranty may be fully justified and in some cases not. If, however, signing on for extended protection allows you to sleep a little better then it’s probably worth it regardless of the product or whether you ever actually use the extended coverage.
What Products are Typically Covered?
There was a time when extended warranties were not widely available but those days have passed into history along with New Wave music. The fact is that today almost all products sold in the UK offer some degree of extended protection. The most popular insurance policies cover mobile phones, white kitchen goods and technology.
Should I Purchase Appliance Insurance?
When You Should Pass
- If your item is brand new, then there is a good chance you can leave it for a few years. After all, most modern appliances are built to last these days. You will have got at least a year of cover with the purchase as standard, so it is only after this that you should start considering a warranty.
- Think about what can go wrong with it. A toaster has fewer working components than an oven, but a mobile phone could be dropped, stolen, submerged in water or could just malfunction. Measure up the risk of something going wrong.
- Also, it doesn’t make a lot of sense to spend £100 per year for an extended warranty on a product that costs £250. It would be cheaper to just keep a little piggybank of money for emergency situations and buy a new one when the time comes.
When you Should Purchase an Extended Warranty
Kitchen appliances are products that, for one reason or another, most homeowners don’t swap out very often. Just about anything else you’ll find in the modern kitchen will be there for a few years, unless a big design overhaul is done. As such opting for extended coverage on these items is often a good, common sense thing to do. The key to purchasing extended coverage on kitchen appliances is to make sure you don’t pay more than 20% of the original purchase price of the item itself. If you do, any benefit may be negated.- Essential appliances which would bring your home to a halt if you had to go without are also good to cover. Fridge freezers, ovens and washing machines are likely used almost every day, and having to cope without is a struggle for even the calmest of homes. Having insurance in place will get that item repaired or replaced ASAP, without you forking out much more money.
- Home improvement products are another instance where extended warranties can make a lot of sense. Since most people plan to stay in their homes for many years, purchasing lifetime warranties on things like replacement windows is a good idea. Keep in mind though that lifetime warranties can come with the product as standard. You may be able to find a local fitter who offers a ‘free’ warranty to save some money.
- Cameras – and by this we mean high end DSLRs – are another product for which extended warranties can make a lot of sense. While mobile phone cameras have come a long way they’re still not comparable. And if you’re serious about photography this is the type of camera you’ll want. Their lifespan can be formidable but so can repair costs. This is because, should problems arise, the camera typically has to be shipped back to the manufacturer and disassembled by the same professionals that put it together. Opting for an extended warranty plan on a high quality camera is a choice that could pay off handsomely if you keep that camera for any length of time.
Kitchen appliances are products that, for one reason or another, most homeowners don’t swap out very often. Just about anything else you’ll find in the modern kitchen will be there for a few years, unless a big design overhaul is done. As such opting for extended coverage on these items is often a good, common sense thing to do. The key to purchasing extended coverage on kitchen appliances is to make sure you don’t pay more than 20% of the original purchase price of the item itself. If you do, any benefit may be negated.
Extended warranties are not the be-all end-all of consumer protection. But nor are they the scam they’re sometimes made out to be. The fact is extended protection often makes a great deal of sense, particularly when talking about products with long lifespans like automobiles, windows and high end cameras or items that people tend to keep for extended periods like kitchen appliances.
By purchasing an extended warranty, you may wind up saving yourself considerable money in the long run. The vital thing is to compare the coverage you could get.
