extended warranties

[Georg R. Baumann]

I just purchased the EPSON 11880 and as I am located in Republic of Ireland, I have to deal with Epson UK on the matter of extended warranty.

This is a very expensive printer, but the additional cost of 3 years warranty makes it even more expensive. Luckily I struck a good deal on a package consisting of installation plus additional training day and 3 years extended warranty for two printers which normally would have been in the region of a whopping 2,700 euros. I got it for a total of 1500 euros.

Taking the extended warranty alone, it breaks down to roughyl 24 euro/month for the big printer and 7 euro/months for the small one, which I consider to be really high but acceptable for a peace of mind solution.

However, comparing that with the 3 years extended warranties of my Mac Pro made me think. The Mac is state of the art as well, 8x 3.0 Ghz, 16 Gig RAM, 5 TB harddrives etc. and the costs for the additional 3 years were only 216 euros, or 6 Euros/months.

So what is your experience on costs of extended warranties?

 

[Dierk Haasis]

I don't take them.

Electronics already come with a 2-year warranty in the EU. Put the money you'd pay for an extended warranty into a savings account and yo'll actually make more money instead of losing the original amount. If anything should happen to your gadget outside its warranty, use the saved money.

There have been some studies about that, which I am too lazy to find myself, but they all came to the same conclusion: extended warranty is more expensive than saving the money.

 

[Alain Briot]

I agre with Dierk. I don't buy extended warranties for the reasons Dierk mentions.

Another reason not to get them with digital photo gear is that most warranties are 1 or 2 years and just about all my digital equipment gets replaced within 1 or 2 years . . . I wish it wasn't the case but the rate of improvement in digital photography is such that 2 years is an eternity.

Since I started making a full income from digital photograph sales in 1997 I have never had the need for using an extended warranty for the above reasons.

Save your money!

 

[Georg R. Baumann]

Well, my view and experience differs.

Things in my world have a habbit of breaking down 24 hours after warranty is over.

A call out, parts, labour and all this can be very costly, and I rather have a peace of mind solution for gear that I use to earn money. IN total and so far, extended warranties have spared me money over the years.

 

[Bart_van_der_Wolf]

Well, my view and experience differs.

Things in my world have a habbit of breaking down 24 hours after warranty is over.

A call out, parts, labour and all this can be very costly, and I rather have a peace of mind solution for gear that I use to earn money. IN total and so far, extended warranties have spared me money over the years.

Hi Georg,

While I agree with the 'peace of mind' aspect, especially when living in a reote location, there should be really some benefit to such a deal. For instance, you made a package deal including training and other stuff that would otherwise have to be paid for (?), maybe that made it a reasonable deal. Faster than usual service or on-loan equipment, may also be factors to consider in the light of contingency planning for a one man operation (time is money), and reduces the need for back-up equipment (which also costs money).

However, and I expect there will be frustration and lost time involved getting one's right, by law of many countries one may expect a product to function as advertized during a reasonable time after purchase (assuming normal use and maintenance). The debate will be about what 'reasonable time' and 'normal use' is.

For many household appliances in the Netherlands, a 3-5 year period is considered normal. Significant failures within that period are considered to be manufacturing issues that will overrule whatever warranty period limitation is claimed by the manufacturer. A manufacturing issue means that one didn't sell a product with normal usage expectancies, and is considered misleading (to say the least).

Bart

 

[Alain Briot]

Another issue with extended warranties is that, at least in the US, they are pushed onto purchases for which an extended warranty doesn't make any sense. I once purchased a rubbermaid shelf, which is basically a plastic bookshelf, at a K-Mart store in Arizona, and when I paid for it at the checkout counter the clerk asked me if I wanted to purchase the extended warranty for it. The warranty cost $10 on a $40 purchase...!

I declined and told the clerk that I liked to live dangerously and that I would take the chance that all goes well for the time I own and use this shelf.

Another thing to keep in mind is that when you pay with a credit card, depending on which card and bank you use, very often the credit card company will double the warranty period offered by the manufacturer. They also often offer a warranty against theft. You have to read the fine print to find out if your bank offers this or not, but when they do it is free...

You also have to balance out the cost of the extended warranty against the cost of having to pay for repairs out of your own pocket. For this reason I don't buy extended warranties for cars either because the cost of the extended warranty is most often much higher than the cost of the repairs. Plus, repairs that occur after the manufacturer warranty are not always covered by the extended warranty. And, to make it even more interesting, you have to get the repairs done at an "approved dealership".

That makes it hard when, like me, you travel essentially away from cities and the only garages are locally owned and individually operated. At such times you are more concerned with getting back on the road than by taking advantage of your extended warranty which, to make use of, would require you to have your car towed to the nearest dealership, hundreds of miles away...

Finally, another thing to think about is the probability ratio. Say you purchase 20 items in a year and you purchase the extended warranties for each of them. What are the probabilities that they all break down after the manufacturer warranty is over? Most likely this will apply to only 1 or 2 items. In that case, what's the most costly outcome for you? Paying for repairs out of your own pocket or paying for 20 extended warranties?

Cartesian thinking has so far shown me that extended warranties benefit the manufacturers more than the consumer.