100 Words On: Why Extended Warranties Sometimes Do Make Sense

The conventional wisdom out there is that it’s rarely advantageous to consider an extended warranty unless it’s for an automobile.

Don’t believe it. The truth is, when it comes to extended warranties, things aren’t always quite so black and white. For example, it often makes sense to buy extended warranties for irreplaceable or low-reliability products. Likewise, they’re often a good idea for items that you know may be mishandled by kids (like certain electronic products).

The bottom line: Sometimes extended warranties actually do make sense. The trick, of course, is figuring out exactly when it’s advantageous to pull the trigger.

Photo Credit: Skunkworks Photographic


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    You do make a good point, Len. I had a similar situation last summer when I was tearing up my backyard to finally get some nice grass growing.

    I went to Home Depot to rent a rototiller. They usually add on the “optional” insurance and I always tell them to remove it when I rent tools because I’ve always viewed it as unnecessary.

    However, when I rented the rototiller, I realized that with all of the hidden rocks and buried bricks (not sure why) that I’d found, I was much likelier to break a tine on the tiller.

    I ended up buying the insurance, and I did hit a few rocks, but I didn’t break a tine. Still, I was much more comfortable and efficient in my tiling knowing that if I’d have broken a tine, it wouldn’t have been a big deal. I’d say the $10 or so extra probably saved me a lot of time and worry.

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    This is a trick statement in that it depends on the cost of the extended warranty and the cost associated a repair. Yes, it can make sense to buy an extended warranty, but in few or isolated cases.

  3. 5


    We bought an EW on our 52in. flat screen tv in 09. About 2 months ago we discovered a problem and we are getting a brand new tv next week. $400 saved us $2000!

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    @Everyday: Smart move, Kris! As I noted in one of my earlier posts on extended warranties, Consumer Reports notes that, at 43 percent, lap top computers have the highest repair rate of all products surveyed. Here’s the link: http://www.consumerreports.org/cro/money/news/november-2006/why-you-dont-need-an-extended-warranty-11-06/overview/extended-warranty-11-06.htm
    @Tom: For $10, I think I would have done the exact same thing. By the way, I think your comment is longer than my post. :-) LOL
    @Robert: Yep. I think extended warranties for used cars can be a good idea. It all depends on the limitations, of course.
    @krantcents: The main point is that a little critical thinking is required before making a decision either way.
    @HMom: Good for you! What brand was it?

  5. 7

    nansuelee says

    I have purchased them for some items. On my sewing machine a yearly cleaning was included, which alone costs more than the cost of the warranty. For our Nikon camera a three year extended warranty was $79.99 and includes a yearly cleaning. With a cleaning going for $150 I would say I am ahead $370.01! A pretty good deal in my book.

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    Call me forgetful, but on the few occasions I have bought them, I haven’t used them and have forgotten I have them. None for me!(except one for a camera, which I had cleaned; still don’t think it was worth it)

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    @nansuelee: I’d say you made a wise decision!
    @Barb: Yeah, that wouldn’t be good if you buy one and then forget to use it. Maybe you should try putting a post-it note on the refrigerator? That’s what I do, Barb! 😉

  8. 10


    I haven’t had much luck with extended warranties. We got one on my husband’s used car, but it turned out the dealer lied about how long it lasted. When we tried to use it, we were told it was expired.

    One house we bought came with a warranty on the appliances, but it covered service but not parts. I’m glad we didn’t directly buy it since it was a terrible value.

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      I hope you never patronize that dealer again, Jen. It really is sad when dealers feel free to mislead their customers. Make sure you bad mouth the dealer to all your friends. Word of mouth is a powerful marketing tool — and it works both ways.

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    mmm, we actually made out with the “lost or damaged earring” rider for our daughter which saved us about 15 bucks. Aside from that, I’ve never bought an extended warranty. They’re generally huge money makers for retailers, which highlights just how lucrative they are for issuers – and statistically, how poor an ROI they offer for consumers.

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      Extended warranties are very cost effective with items that can be abused by kids. We used to get the extended warranties for my son’s electronic Game Boy, game Boy Advanced, and his Nintendo Game Cube — and we took advantage of all of them. Saved us hundreds of dollars after his rough handling of those products ended up breaking them prematurely!

  10. 14

    Andi says

    I’ve purchased two used cars from a deelar that had limited warranties on them.And an independent buyer has absolutely no reason to be more honest than a deelar. At all.Think about it. If the sale goes bad at the deelar, you can report them for fraud. Report them to the BBB. Or simply tell your friends not to do business with them, and they lose business.If you buy from a private seller, it’s purely as is. If the car sucks, you’re stuck with it, and it’s not a business for them, so what do they care if you tell other people? You can’t report them. You can try to sue, but you’ll have no case. More importantly, private sellers generally want their trouble cars gone as quick as possible, so they have no problem hiding information. Again, all the rules of a business owner don’t apply to them.Everyone loves to hate on a car sales person, but it’s a complete misconception that they’re more deceitful than the average person. If you put any thought into it, it’s easy to see that they have a lot more at risk, than a private seller does.At the end of the day, it’s this simple:A sales person is selling the car, because it’s their business and livelihood.A person is selling their car, because they don’t want it anymore. Hm. Wonder why .? Must be some reason that they’d get rid of a good car .So, your grandparents are right. Even if they don’t get a warranty, they still have a better statistical chance of an honest sale.

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    Hengda says

    I bought extended warranties on all my Apple laptops. Only one of them gave me (a lot of) trouble. I had 3 major repairs (all covered by the extended warranty) before I requested a replacement. It was a bit of a hassle but I got a brand new MacBook Pro with an upgraded operating system. It has worked with not a single glitch since. Thanks to that (not cheap) extended warranty.

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