Extended warranties are basically a waste of money
Many shops will still try to sell you an extended warranty when you buy a kitchen appliance or TV, but they’re not always your best or most cost-effective option. So, are extended warranties worth buying?
Extended warranties, a bit like Baywatch and Ace of Base, were big in the 90s. Back then, there was a good chance you’d need to get your appliance repaired. And most of the time people preferred to pay the extra money up front, rather than having to find the cash to fix their appliance when it went up in smoke.
Shop staff were also well trained in the art of convincing you that you had to take out an extended warranty to protect your new telly or fridge. But is that still the case today?
Our warranty warning
At various times during the last decade, extended warranties have come to the attention of the Office of Fair Trading (OFT) and it acted to prevent so-called ‘pressure selling’ in 2005. However, the OFT has been forced to look at them again as the market for warranties still rakes in millions of pounds for retailers.
So we wanted to see whether extended warranties could actually be good value for money. Our latest investigation found that a five-year extended warranty could set you back up to 65% of the price of a washing machine. And when there’s only a 12% chance of appliances needing repair in the first five years, it hardly seems worth it.
Similarly, the price of a five-year extended warranty on a £799 Sony Bravia KDL-40EX723 television is £269 at Currys, with Sony TVs having just a 3% likelihood of needing repair within five years of you buying the new set.
Why would you cough up so much cash for something that’s unlikely to happen? In reply to our previous extended warranties Conversation, Bechet told us that:
‘The few extended warranties I have bought were a complete waste of money and I have learned my lesson. If it doesn’t go wrong within the first year, it probably won’t fail within five.’
Peace of mind for some
Then again, some Which? members do like the reassurance of having an extended warranty to supplement the manufacturer’s warranty.
In our survey of 1,401 members, most who had taken out an extended warranty in the past five years said they did so for the convenience of having a repair sorted out quickly and easily, or so they could avoid the unexpected cost of repair. Commenter Ali agrees with them:
‘I think extended warranties are SOMETIMES worth the money. For example, I have a large family and a washing machine is vital to me. Most washing machines last me about two years at most – I do not have the money to fork out £300+ on a washing machine every time it goes wrong.’
However, wouldn’t you be better off putting the money aside in case you do need to pay for a repair, rather than having to fork out for an extended warranty when you buy an appliance? Then, if it doesn’t break down within five years, you’ve made a good start towards funding a new model when it does.
So, do you agree that extended warranties are an extra expense you should avoid? Or are they good for peace of mind should your appliance give up the ghost?
Are extended warranties worth the money?
No - I don't think you need them (93%, 267 Votes)
Yes - I like the peace of mind (7%, 19 Votes)
Total Voters: 286
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