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Warranty Or Worry?

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By ANGIE HICKS Special to the Tribune

The Tampa Tribune

Published: December 21, 2008

Anthony Borton purchased an extended warranty on his new television set in case something went wrong with it after the manufacturer's warranty expired.

So when the volume went out shortly after the original warranty ended, Borton contacted the extended warranty company's repair center. He was told a part would be ordered and sent to him.

The part never arrived despite nearly two months of Borton's phone calls and complaints. Finally, he gave up and took the television back to the store where he purchased it. Fortunately, he found a manager willing to let him exchange the set for a new one. Still, the Wesley Chapel resident is not happy with the warranty process, which kept him without a working television for several weeks.

"I'm very wary of these warranty companies," he says.

He's not alone. According to a recent nationwide poll of Angie's List members, nearly 75 percent of respondents who had purchased a product warranty said they would think twice before they did it again.

For those spending several hundred or thousands of dollars on an electronics or home appliance item, an extended warranty might be worth considering. But no one should buy without taking a close look at the warranty plan offered, as well as other options that might be available for free. In many cases, consumers decide the additional coverage isn't worth the cost.

Many credit card companies will double a manufacturer's warranty if you use their card to pay for the item. Some cards require specific documentation before honoring warranties, so hang onto your receipts, serial numbers and manufacturer's warranty information.

In Liza Ryan's case, buying the extended warranty paid off. Ryan says she doesn't normally purchase the protection for electronics, but decided to when she learned the video game system and game she was buying frequently had problems. Both items ended up needing repair or replacement, and Ryan says she was satisfied with the way her claim was handled.

"We've had three game systems break and the company has supplied us with a brand new one each time," says the mother of three. "My sons use these things every day for hours. Their friends come over and just play, play, play. They're highly used and break frequently."

Half of the Angie's List poll respondents who have bought an extended warranty said they never used it. The most popular items for warranty plans were for laptop computers and televisions, which can break frequently and can be expensive to repair.

"I know extended warranties used to be useless, but not in the case of new technology," says Mike Eidizadeh, owner of Tampa's Advance Electronic Solution. "The rate of failure on these new products is much higher than the old products."

Eidizadeh cautions consumers to read the fine print before purchasing a warranty and to avoid buying one that takes effect before the manufacturer's warranty has expired, in essence, doubling up on coverage. According to the Angie's List poll, 34 percent of the respondents who had to use their warranty did so between the first and second year.

Regardless of the type of warranty you buy, it's only as good as the service company contracted for repairs, says Alison DiChristopher, co-owner of Tampa-based A DiChristopher Appliance Service.

"I've noticed that whether consumers are happy with the warranty or not is directly due to how the servicer handles them," DiChristopher said. "Do they get a call right away? How courteous is the contractor to them? If the part has to be ordered, is the contractor communicating with them on a regular basis?

"If there's not good communication or the customer has a bad experience, they think the warranty is horrible."

BEFORE YOU BUY

Here are a few tips on buying added protection for your new purchases:

Get the details: Some manufacturers have longer and better factory warranties than others, so check the terms first. You might decide to go with Product B over Product A because Product B has a one-year parts and labor warranty, compared with 90 days for Product A.

Know your options: Your credit card company may provide an additional warranty if you use their card to make the purchase. If you're buying an expensive piece of equipment, you might be able to add it to your homeowners policy for less than the cost of an extended warranty. Some retailers even offer free extended warranties.

Shop around: Different retailers offer different plans. You might pay $100 for a plan at one store and $50 for a similar plan at another store. Don't feel pressured to make a decision at the time of purchase. Most extended warranties can be purchased any time before the manufacturer's coverage ends, giving you a chance to try the item out and determine how well it works and the potential for a defect. If you send in the original warranty card, many manufacturers will contact you about extending the coverage before it expires.

Read the fine print: Do you have to send the product off for repair or will it be fixed in your home? If you have to take the item to a repair center, is there an authorized center in your area? Is everything covered under the warranty, or are certain parts or labor charges excluded? Ask your salesperson what happens to the warranty if the store goes out of business.

Check the terms: Your manufacturer's warranty is free, so avoid paying for extended warranties that start from the date of purchase instead of at the end of the factory coverage. Of the Angie's List poll respondents who used their warranty, nearly 75 percent said they needed service within the first two years. Also, most extended warranties do not cover accidental damage, so if you're worried about breaking your laptop screen, additional protection might not help.

Research the product: Do your homework and ask yourself pertinent questions before you buy: How has this product performed in the past? Do you have the financial means to repair or replace it if it breaks? Would you be more likely to purchase a new unit if this one breaks or would you pay to have it repaired? Can you wait for the repair to be made or is this an item you can't live without? How quickly will the technology change and will you be ready to upgrade by the time this one wears out?

Angie Hicks is the founder of Angie's List, www.angieslist.com.

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