Brian Cooley: Are Extended Warranties On Tech Gifts Worth It?
(KPIX 5) – If you buy a big ticket tech item this holiday season, you may be tempted to get some sort of extended warranty on it. We typically advise against that.
Factory warranties are typically a year on a lot of tech products and that’s much shorter than the product may last, but consider extended coverage from your credit card company that might add a year right off the bat. Double the warranty for free is common.
Moreover, extended warranties you buy often run concurrently with the factory warranty, not after it. That means the first year you paid for is a waste.
TVs and laptops are valuable, but not necessarily all that fragile. If you drop things a lot, that’s another matter, but odds are your TV isn’t moving during the time you own it.
Consumer Reports found that TV repair rates run about 5%-6%. Laptops are among the highest rate, but still hover around 14%-15%. Most products that are not DOA are going to last a long time. Does it make sense to buy a warranty that costs around 10% of the product’s price against those long odds of ever using it?
You may feel warranties are cheap, and getting cheaper. Which may be true, but also realize that means they are seldom needed. Otherwise, warranty companies couldn’t make those offers at that low price. Insurance is insurance.
Know that extended warranty is often just a service contract at a facility that may or may not be convenient, in home or related to the manufacturer. Check out those details if you really feel you must get one.
For more details on tech product warranties, read my colleague Geoff Morrison’s piece on CNET.
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