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Extended warranties and paying for peace of mind

Extended warranties are often characterized as a form of insurance. Most consumer advocates consider them a bad investment. Does paying for an extended warranty ever make sense, or are they false comfort?

Extended warranties are often characterized as a form of insurance. Most consumer advocates consider them a bad investment. Does paying for an extended warranty ever make sense, or are they false comfort?

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Last night, the battery cover latch for my BlackBerry Pearl fell out of the phone's housing. After crawling around on the floor for a few minutes, looking for a spring that was smaller than a grain of rice, I began to panic. I've come to really depend on my Blackberry, and I can't imagine being without it. Worried that my phone was going to continue to fall apart, I started to regret not purchasing handset protection from my carrier. This was a completely crazy notion. In my defense, I was under duress, and I quickly came to my senses.

I didn't buy the protection plan for the phone when I signed up with this carrier a year and a half ago. At that time, when my head was clear, I figured that the additional cost wouldn't make sense in the long run. I was completely right about that.

To cover my BlackBerry Pearl under the carrier's handset protection plan would have cost me $119.80 to date ($5.99 a month for the premium, over 20 months). To file a claim under the damage protection plan, I would be obligated to pay a $110.00 deductible on the policy. So, if I had decided to go for my carrier's handset coverage, I would have paid $229.80 to get a refurbished phone.

Yup, you read that right. A deductible. For a phone.

Not a very good deal, considering I paid $99.00 for my BlackBerry, new.

In spite of their cost, the fact that people still buy extended warranties should come as no surprise to us. Many consumers are risk averse, and they worry about losing on their investments. Remember the sunk cost bias? It often seems that a small investment to protect a larger expenditure could be a good idea. It's that idea of easy supplemental protection that lulls people into buying extended hardware warranties.

I've found, at least in my work, that warranties are most attractive to the small operator. Large organizations buy so many machines that the cost of insuring individual pieces of hardware against failure doesn't make fiscal sense. The bigger companies also often have existing arrangements for IT support, so they don't need access to the call center or the on-site services that some manufacturers offer with their plans. Small shops that don't have support capacity built-in seem to hope that extended warranty coverage will protect them from needing to contract for professional IT services later. There have been a few occasions where I've bought extended warranties for clients. Usually it was because they asked for them. Sometimes it has even felt like they were purchasing extended service plans so they wouldn't feel locked into needing my help down the line.

Do extended service warranties have any real benefit to the enterprise? Who forms the target market for these products? Let me know what you think in the comments.

44 comments
Darren B - KC
Darren B - KC

I bought a Sony 46" rear projection TV from Best Buy back in 2004 for $1300 plus a 4-year extended warranty for an additional $250. A couple months ago, the picture went out (while I was watching X-Files on DVD, no less), but when the Best Buy technician came to look at it, the problem wasn't the bulb as I suspected. Instead the main controller board had burned out. This all happened exactly 20 DAYS before my extended warranty was set to expire! Talk about perfect timing. They replaced the main board, but it turned out that another component had also been damaged. Best Buy ruled that it was too expensive to repair, so they gave me $1300 credit to pick out a new TV. The warranty contract stipulated that I had to stick with "the same or comparable technology", so I couldn't choose from the LCD's or plasma's, which was a bit of a bummer... but I can't complain because I still ended up with a VERY nice 50" Samsung DLP with nearly all the bells-n-whistles. Yes, I bought another 4-year extended warranty for $250, and I'll never buy another TV without one.

Ike_C
Ike_C

Call it extended warranty, insurance policy against high expenditures when breakdowns occur, or service contracts, the one thing that these packages will insure for you is that someone out there will still have the correct spare parts if and when your box breaks down, specially is you are on a critical, no downtime situation. Yes, you can go out there and buy extra equipment, but in most cases after a while someone will use the extra box(es) and defeat the purpose of having them at the ready.

art
art

The carrier is Sprint. I used to pay $4/mo., now $7. No deductible for mechanical failure. $50 deductible for a lost phone. I've been carrying the warranty since about 2004. My daughter dropped her phone in water and had to pay $50. In my case I went from a dying $499 Kyocera 6035 smartphone to a $399 Samsung i300 for nothing. When I noticed a screen defect in the i300, I was upgraded to the i500 for nothing. When the i500 got long in the tooth, I was given a Treo 650 (cost $0). After a year with the 650, I was handed a new Centro. My son has been through 3 phones at no cost. Oh, and Sprint didn't require me to buy the warranty when I first got the phone. I added the warranty to the original Kyocera after I had it for 3 years, at Sprint's suggestion after a couple of the keys were starting to get a little sluggish.

Wolvenmoon
Wolvenmoon

With how fast new HDDs are failing I can understand completely buying a 2-3 year extended warranty on them. WD just dropped their consumer drives' warranty to 3 years from 5-a bad sign. Especially considering their quoted MTBF is still up above 80,000 hours. With all digital stuff like that more often the needed parts for repair can be done by a novice with an internet guide than not. When you get into hard drives and other mechanical devices that store data, yeah, definitely, make it equal to five years of protection.

nick
nick

I saw a graph several years ago of the failure rate of electronic equipment including TV's, Computers etcetera. In the first 3 months you have a high chance of failure, the burn in period. Then you have alomost zero failures up to the 4 year mark. Then the failure rate starts to climb. Most manufacturers warranty covers the first period of high failure rate. So your extended warranty covers a period of time when the manufacturer expects zero or very few failures. In my view the extended warranty is pure profit to the manufacturer. However the reason why you may choose an extended warranty is because it smooths the cost over a period of time. It is easier to find a few dollars each month for the warranty rather than a huge lump sum when you need a repair done.

Chug
Chug

You don't say what you ended up doing. Did you find the missing piece or did you end up having to buy a new BB? If you had to buy a new one, how much did you pay for the replacement? You may have paid $99 for your BB new, but I'm guessing that was a discounted price as a new subsriber or for committing to a new plan, and maybe even after a mail-in rebate. If you have to buy a replacment for a lost/damaged unit without the "insurance" you'll have to pay full price and most likely won't be eligible for any rebates. When you consider that cost, the insurance may be worth it. I probably wouldn't get it on a phone that was free initially and might cost $100 to replace, but I did get it on my new smart phone that cost me $100 new (discounted with a new 2 year commitment and mail-in rebate) but would cost me over $400 to replace at full cost if I lost or damaged it. Although my carrier (Sprint) only has a $50 deductible.

mholzworth
mholzworth

I fully back the purchasing of extended warranties. However, you have to be selective on what you actually buy them for as well as look closely at the extended warranty wording. You want to avoid warranties that mention giving you a refurbished one instead of a new replacement. You also want warranties that give you a once a year "free maintenance" and you want to buy it on something that it makes sense for like brand new technologies, really large appliance purchases like wahsers, dryers and large TV's etc. You have to learn the intricacies of the extended warranties you are buying and make sure that they are worth your money or time (some make you lug a huge piece of equpiment or appliance in to them instead of home service).

jweil
jweil

Generally not, but with a few exceptions. For my fridge I generally get one when buying the fridge as it usually contains a clause for food spoilage and is cheap or I negotiate to get it tossed in. I also got one for my dishwasher as it is foreign, parts not easy to get, a pain to pull out and work on, and service has to be factory, and I get the money back if I do not use it. I got a care warranty with the same money back option and got my money back as any minor repairs I had done outside of the warranty as I bought with the Idea I would only use it for major issues which did not happen. However there is one major exception - AppleCare. I always buy and recommend Apple's AppleCare for Mac's. The reason is not for service but for the support. Phone support is only 90 days. Then it is $40-50 per call. Four or five calls in 3 years and the support has paid for itself. It gives me access to a factory support agent whenever I want to answer any question about the computer with out thinking about the cost. It could be a question about a Mac application or weird sound, how to do something I am not familiar with - anything Mac related. While I have never had to have a machine serviced out of purchase warranty, the phone access has always made it a good value for individuals. Like others have said, a warranty is like an insurance policy. You just have to weigh the cost of the policy against the cost and likelihood of a repair, the life of the product, and the convenience factor.

dontrespond
dontrespond

It depends on the value of the product. I bought two laptops, one for me and one for my wife, purchased a three year coverage plan. It saved my bacon several times over.

winandine
winandine

In Canada, at least, extended warranties are a valid business expense, each year, I was able to write off the yearly portion of the warranty. A lot of IT-related hardware takes two years to be "written off" completely. However, some warranties can only be one year or less, so an extended warranty covers the gap. Personally, I also like extended warranties for notebook PCs that have "no quibble" guarantees, because I don't want to have a repair refused because it might be argued to have been caused by physical abuse.

skristof
skristof

I bought a Toshiba A30 in 2005 with a 3 yr extende3d warranty. (Extra 180.00) Within 18 months the processor started playing up. I sent the machine to the repairer, cost AUD 1160.00 + freight. Good investment that time.

jturner1
jturner1

I did not get a warranty for my big screen tv, 18 months later it needed a $500 board. So this time, when shopping for a TV I checked out Circuit City's extended warranty. On a $900 tv they wanted $300 for two year extended! Too much for me. So I went elsewhere and got got an excellent tv for $999, with a 3 year extended for $79.

robbie
robbie

For home users, yes. In the past, I purchased Dell 2-year warranty service for a new computer. Within the two years I had to have my disk drive repaired/replaced. The warranty came in handy. This may be a rare occasion, but the rare occasion happened to me. I would definitely purchase warranty coverage again with a new computer.

The Scummy One
The Scummy One

some items, mainly items that travel around and get used in situations where they may break more easily. These items cover (for me) travel printers, notebooks, cameras, and PDA's. Outside of that, I wouldnt wast my money. But with those in mind, here are some basic rules to follow. with cameras, printers, and the like, get accidental damage and extended warranty ONLY if it is not one of the cheap models. Often the extra warranty service costs roughly 1/4 to 1/2 the cost of new equipment. Also think about depreciation over the year. Always get accidental damage coverage for notebooks and PDA's

c_schnitzlein
c_schnitzlein

Extended warranties are only good on high cost products and the deductable is small or none existant.

tchase
tchase

Extended warranties have saved us paying out for replacement laptops or repairs. I only get the extended warranties with our laptops, not PC's. I also get Dell's Complete Care, we have had laptops melted on the stove, run over by a car, screens smashed, etc and Dell has covered them all. I know we are getting our money's worth out of these warranties. Laptop repair is a length process as well as can be just as expensive as the warranty itself.

mla_ca520
mla_ca520

We have hundreds of Dell workstations and we typically get the 3 year coverage, which pays off, becuase of power supply failures and/or hard drive failures. It saves us time, we have only to call dell and they get us a replacement part usually the next day. When we have laptop probs, a tech will come within a day or two and fix it...including mother board replacement.

MGP2
MGP2

In August of 2005, I bought an HP-M7170N Media Center PC for $1200. I didn't buy the extended warranty because I figured I was buying a quality product and it wouldn't be breaking down anytime soon. WRONG! Thirteen months later (that' one month after the warranty ran out), it crapped out. Circuit City's Firedog diagnosed it as a motherboard issue and said it would cost $600 to replace. Best Buy's Geek Squad told me they don't even change motherboards. (Hardly Geeks in my eyes, if your services are that limited.) But, because of the horrible intricacies in that PC (you can't even install memory without taking half the insides out), I couldn't change the mobo myself. How did I solve my problem? Well, first off, I vowed never to buy another high-end product again without purchasing an extended warranty. But, because I was still gun shy, I purchased a lower end pc and cannibalized the HP of its power supply, graphics card, and sound card. I'm now very happy with my Systemax PC. And, even though it was a mobo problem, I still hold HP responsible for selling me a pc with that mobo, and probably won't buy an HP product for a long, long time.

cj_mcnix
cj_mcnix

We always extend warranties on our clients' Dell servers for as long as possible. The cost of the warranty is easily made up when the tape drive alone fails; which happens so frequently that Dell has a seperate support line option for them!

CharlieSpencer
CharlieSpencer

I'm seeing a rash of two-year-old Dell Optiplex GX620 desktop units that are blowing power supplies at power up. All are on either surge protectors or UPS. Afer having no previous problems I've seen six this summer on the appx. 50 units we have in use. All are under extended warranty; in this case it's paying off. While we haven't seen failure rates this high in the Compaqs and HPs we used to use, it was still high enough to warrant the cost, especially on laptops. I won't buy an extended warranty for home products. Offering me one once gets a, "No, and please don't ask again." Asking twice results in my taking my business elsewhere.

JohnMcGrew
JohnMcGrew

It really doesn't make much sense to buy "insurance" on products that have the economic half-life of bread. Odds are that when your device breaks, be it a phone, DVD player, or TV, there will be a newer, improved model available at the same price, or much less. The likelyhood his that the depreciated value of the device you just broke is already near-zero. Williams example is priceless. The deductible was more than the phone? It's very telling that nearly the entire profit margin at the big box stores is made not from the sales of product, but from the sales of extended warranties on them. That's why they push them so hard. I love how after a salesman has pitched you as to how wonderful a certain product is, his next pitch is to sell you a warranty because it's inevitably going to fail in the next 18 months. Personally, I don't like replacing things that fail that easily. And a quick Google-search will show just how easy it is to collect on those warranties. My credit card gives me better warranty protection by default than most of these "extra" plans do.

williamjones
williamjones

In my professional life, I find it hard to make a case for extended hardware warranties. In my personal life, though, I've bought several. I usually buy additional manufacturer coverage for my personal laptops. It's an investment I'm willing to make, and I just factor it in as part of the purchase price. I usually avoid store warranties completely, though. The one instance where I wished I had purchased store coverage occured recently. The manufacturer of the HDTV I purchased last year has recently announced that they are going into Chapter 11. I'm not sure I can count on them for warranty service now, and I wish I'd bought the retailer's coverage at the time of my purchase. It was only $60. Anyone else want to own up to their sordid use of extended service plans? Has one ever saved your bacon?

williamjones
williamjones

...so I'll make do. I did find the clasp and spring, so I'll tr going to talk to my carrier and see if they'll do an over the counter exchange. But I'm not going to spend anymore money, or replace the phone. You're right, my $99 deal was obtained at Amazon with a 2 yr contract. I'm not eligible for a cheap upgrade yet, so my solution will probably a little duct-tape, or maybe epoxying the battery cover on. That should hold me until I'm ready to upgrade. To be fair, I love the BlackBerry Pearl, but I think this battery door issue is a design flaw with the phone. I encountered a similar problem with a work colleague who we'd bought a Pearl for. Her battery latch came off her phone, but since she'd lost the parts, the carrier called her's a case of negligent damage. RIM, the BB manufacturer hasn't released a tech note about any issues with the battery cover latch, so most carrier won't admit to this probem is due to workmanship. Since I found my parts, I was able to confirm that the battery latch and its spring are held on by two flimsy plastic tabs. They're not designed to hold up to much stress; I'm not at all surprised that they break. Love the phone, beware though. Thanks for your comments!

jamesmonrow
jamesmonrow

One of my customers recently dropped his HP Pavillion notebook and cracked the LCD screen. The unit was less then a year old, and when he went to the HP web site he was able to purchase an extended year (2 year warranty) that also has an unlimited damage protection policy so he could get it repaired. I am surprised to find that HP and other manufactures will allow the consumer the option of extending their original warranty to include the added damage protection any time during the initial year. The option of purchasing after the fact may encourage consumers to not worry about the insurance at the time of sale, allowing peace of mind for the first year. James

wildcatsystems
wildcatsystems

It's a laptop and you have kids. I repair these for Lenovo/IBM and HP. I've seen plenty where the laptop got yanked off the table where it was sitting. Also neither manufacturer will replace the LCD panel if it's cracked (unless you have the accidental damage protection). On the Lenovo laptops don't pick the laptop up by the edge of the screen. It's almost guaranteed to crack the LCD panel. I have a very large HP Compaq Presario X6000 series that was given to me by a gentleman that brought it in for diagnosis and didn't have the extended warranty (It's around 2 years old). This laptop is so large that it has 3 fans and a massive power brick. It gets so warm that the contacts on the BGA Ram for the video card cracked and lifted off the motherboard causing lines down the screen and artifacting. Replacement boards for these units are between 300 - 400 dollars on EBay. A cheaper option would be to find a repair shop that could reflow the solder connections but that's a crapshoot. So, it's a very good idea to purchase the coverage on laptops.

Will_B
Will_B

I have and have not purchased extended warrenties. For my Car's I have boughten the extended warrenty all the time, it has paid off twice as I gotten 2 brand new engines on extended warrenties. For my Big Screen TV I bought one, and at the end of 5 years they replaced all the bulbs, and resynched the tv, it was better then the day I bought it. Both the Cars and TV's are high cost, and i expect them to last for 5+ years. On my Digital Camera's, small TV's computer parts, it makes no sense. Why buy a 80 dollar warrenty on an item I am going to want to sell in 2 years to get the latest and greatest anyway. Especially computers, the industry is changing so fast, that I want to upgrade the core dual (1.8) ghz machine i bought 2 years ago into a Dual 2-core or quad machine. Why would I buy a $70 dollar warrenty on a $250 dollar product. That is like already 25% of the cost. And if the manufactures can't make a good to a great product that will last for a few years. Then word of mouth gets around, and you don't buy that vendors product anyway (given you do get some lemons). It is still a buyer beware. And do your research and have consumer knowlege before buying products. Extended warrenties, How long do you really expect the prodcut to last, when will you be upgrading anyway, how much is it to replace the product (should it break down), and what is the percentage of warrenty costs vs replacement costs (keeping in mind if if breaks, you can then buy the latest and greatest). Still all personal choices, but things to consider.

jejsub
jejsub

I can't tell you how much having Dell's 5-year warranty has saved us in the last 4 years! We've had all the MBs replaced on 60 GX270s, dozens of powersupplies and MBs on GX 280s, and fans on GS 620s. There are 1.5 tech people to take care of 400 desktops and 9 servers in our private school--I demanded our Board pay for the extended warranties if they weren't going to pay for more tech people.

NDYNAMICS
NDYNAMICS

We do IT support for small business. I agree on Dell, especially on servers and laptops. I pretty much require my customers to renew out of warranty server contracts, unless they are planning a replacement within 12 months. I get IT Pro (old Gold) support on everything, and CompleteCare on laptops, to get to the tier 2 queue in Texas instead of having to talk to India first. I also get IT Pro support on desktops. Honestly, I haven't used it all that much, but it doesn't cost much and as an IT support company it makes it much easier to deal with hardware issues. Why should my company go through the grief of having to identify the right power supply, put in a loaner machine while it ships, swap it again when the power supply arrives, etc. It's like 4 or 5 office visits, and customers aren't willing to pay for that many site visits for a dead power supply, so it's a lot easier just to make them pay the $60 or so for the NBD desktop warranty up front and roll it into the cost of the PC. I'm sure it's more expensive in the long run, but it WORKS. When a desktop gets 3 years old, I don't bother renewing the warranty, and we take it case by caes. Now, on cell phones and refridgerators, there is NO WAY you will win, so don't even bother. The warranties are priced so that by the time the product is out of manufacturer's warranty, the total price you pay for a replacement, with deductables, etc, will just about match or exceed the original price of the unit. Particularly on the cell phone warranties, which I deal with all the time, the grief they put you through to get the unit swapped isn't worth the $50 you might save using them. Most of the time they won't even replace it with the same unit, and often the replacement is a DOWNGRADE. So I say no on any consumer products, and with the exception of really expensive PDA's (> $300), no on cell phone insurance too.

RDSLO
RDSLO

Working for a large retailer (cannot name), I see this type of thing day in and day out. Small stuff can be handled in-store even if parts have to be ordered from the manufacturer; they normally arrive within 48 hours. A MOBO would normally be sent to either the store's repair depot/ warranty company or to the manufacturer if the company has a contract. Though they will not get specific, it has more to do with liability for the non-warranty work rather then the lack of capability. If your new component goes down the store is now on the line for the cost of replacement. Bad news for corporate! You are right about the terrible design in most tier 1 cases though. What a pain to work on; especially the small form factor systems we are seeing. Your solution makes the most sense under the circumstances. One thing to understand; make sure, if you are going to buy extended coverage, you are getting a service contract rather than an extended "warranty". A warranty can be limited in what is covered. Extending it only covers those components for a longer period of time (the ones the manufacturer feels are not likely to fail)! A service contract normally handles anything that happens under "normal use". The accidental damage rider covers most incidents beyond that. Weigh the cost of the coverage vs just replacing the system. No "normal" person will spend a 40-50% premium for coverage unless they believe it will pay off: i.e. they know something bad will happen before the coverage expires. Best advice is to build your own if you know how.

jsexton9
jsexton9

I always take extended warrantees on my personal computers and printers. In the past 10 years or so I've gotten pay-back in the form of a new monitor when my Sony Trinitron crapped out, a new motherboard--with in-home service--on the accompanying CPU, at least 5 replacements for CD-Rom drives (the last replacement substituting a DVD writer), two new hard drives, and a new screen for a Sony laptop. I have also cashed in on at least three replacement printers.Those are the ones I remember. What I saved on repairs and replacements was well worth what I paid for the contracts. I do not automatically purchase extended warranties, but do so only after weighing all the alternatives, contingencies, and relative costs. Since computers are still subject to a plethora of hardware failures, I lean heavily towards doing it with them. On the other hand, I have never taken an extended warranty on a TV or on sound equipment. I've "saved" so much by exercising that option, that I feel my next purchase in either area will be "free".

NotSoChiGuy
NotSoChiGuy

If one is in a position to quickly pay back the cost charged to a credit card, that is a very good route to go. Depending on card and level, you can get warranties extended by 1-2 years. Consumer Reports did an examination of Extended Warranties about 12-18 months ago. They pretty much said the same thing many others on here have: usually makes little sense (but they did note some high priced exceptions).

wjacomb
wjacomb

I would never buy them for a desktop but my experience is that it is always a good idea for a laptop given how easy they are to damage. William Jacomb

JackOfAllTech
JackOfAllTech

40 years ago, my parents bought a washer/dryer set from Sears. At the time, my Dad bought the extended warranty plan WITH an option to renew each year. For the next 25 years, he paid $49.99 a year. I 'inherited' those machines when my mom died a few years ago and they were still working because every single part had been replaced at least once by Sears at no cost to my parents.

Oz_Media
Oz_Media

As with yourself, I went for the extended plan on my IBM Thinkpad, knowing tha LCD's don't last much mroe than a year and how hard it is to get an LCD covered under the basic warranty. I also included it as part of teh purchase price, which was straight from a reputable IBM business PC distributor, not a retail outlet. I got 5 years, next day onsite service for abotu $300.00, which was chump change when the notebook was nerly $3K itself. Over teh 5 years, I had teh keyboard replaced twice (through it wasn't broken), the LCD replaced once due to burned pixels (the rep even burned a few more out for me so it would pass their minimum for replacement) the system board was replaced twice (which was only due to the headphone jack cutting in and out as any walkman does over time). For anything else, even a retail notebook I just don't bother, the replacement is usually cheap enough as hardware becomes instantly obsolete. I did work in teh retail electronics industry, not computers, when i was a teenager. At that time I worked across the street from Future Shop (in the 80's when it was still an Iranian tax shelter). Future Shop sold complete junk, even worse than the retail junk they pass off as electronics today. And they scammed everyone into buying service contracts; so coming across the street to our outlet, a small, specialized shop with VERY high end audio products, made sales so easy for us. No service plans, equipment was reputable and supported by the manufacturer for 5 years in case of issues. We'd just do a simple over the counter exchange if needed, which was rare. Now retail stores and big box outlets sell disposable junk, not worth the plastic shell it is housed in. It is sold at such low margins, they NEED to sell contracts in order to stay afloat. The salesmen usually don't get comission anymore, which is supposed to mean they don't push things on you that you don't need, but all it means is that the sales staff have no experience, knowledge or ability. They sell loss leaders and other dodgy equipment and rely on that contract to make a few bucks profit. Buy the cheap crap at a cheap price but it sure as hell isn't worth buying an extended warranty for.

HypnoToad
HypnoToad

LCD monitors/TVs - yes! Scanners - yes! Digital cameras - yes! laptops - yes! CD/DVD writable drives? No. Not cost effective. Desktop computer? No. Microchips rarely fail, or at least shouldn't for a decade. (my old Amiga 500, 20+ years old, still works great) Then find out the company's history. Some companies are worse than others... can I name-drop? :D

gforsythe7
gforsythe7

I did a complete overhaul of my companies network and phone system 2 years ago and with it purchased support and hardware warrantees. Total cost of warrantees, about 6000 per year. Net savings, breaking even just with hardware replacement alone and I can't put a price tag on all the support issues that having it allowed me to make changes to my network and phone system that I otherwise would have had to pay a 3rd party vendor to come in and do (Cisco Call Manager). I also have warrantees on my Dell servers, and they have come in handy with configuration questions for server 2003 as well as replacing parts that go bad, HDD, CD-ROM, Fans, etc.. This is much more affordable, and still it has paid for itself in just the ability to have a part sent out without having to go thru the whole submitting a PO, getting approval, placing the order, waiting for the item, etc, etc. I just call, verify troubleshooting, they dispatch, I install the next day! weeeooooo Greg IT Manger Geek Extraordinaire

Raymond Danner
Raymond Danner

Bought a Gateway laptop in August of last year from Best Buy. Opted for the Performance Service Plan with Accidental Damage rider. Came in handy less than three weeks later, when the HDD packed it in. The irony? When I replaced the laptop (after the techs confirmed the problem) I got a more powerful (HP) laptop that was $50 cheaper, and the PSP was transferred to the new laptop for no additional. So, new laptop (still working great) and $50 refund. Paid off in my case. (I'm a one-man shop, and I also write using my laptop, so it's really important for it to be in working order. However, I never actually put anything confidential on the laptop; I use flash drives for that, and never let them out of my sight.)

rfolden
rfolden

I've bought two ESPs in my life, both (at the time) pretty expensive. Example one: Mitsubishi Rear-Projection television, jumbo (65"+) in size. Purchased 3 year ESP. Wasted money as television is still running flawlessly (6 years +) under constant use. Amazing product. Example two: (The 'bacon saver'). Purchased 3 year ESP on (then) new Sony CDP-1000 'Dragon' Digital Camera. (The big one that wrote to Mini-Compact Discs). A super camera, but about 2 months prior to ESP running out camera failed catastrophically. Toted camera and ESP to and they sent it out for service. Camera was no longer made, and there were no working refurbs in the supply chain, so essentially I got $1300 worth of store credit to purchase a new camera. Applied that credit to a nice Nikon Digital SLR and still had enough clams to purchase a long ESP on the new camera. Winner, winner! Chicken Dinner!

TechForLife
TechForLife

Buying a warranty is like gambling. You are paying for a service in leu of thinking it is going to break over a period of xx years. As if you don't purchase the warranty, you are not paying for a service and hoping your equipment never breaks. It's a gamble either way. The only warranty I've purchased is the 5 year MACK camera warranty. On my first digital camera it was well worth it. No sooner than it was repaired, it was out of date and behind the times so I purchased another digital camera. And again the warranty. This time the warranty didn't cover it because their tech determined that it was not a manufacturers defect and the fact I didn't purchase the "extended" warranty means I didn't get warranty coverage. In fact, I could get a new camera for 12 dollars cheaper than the repair quote. So in short, it really depends on what you buy and what the retail product (price-wise) is projected in the future. 9 times out of 10, you can end up buying new merchandise for the price of the repair quote. In the corporate world - you can do the math and probably come to the conclusion that if you go ahead and purchase spare parts and not the extended warranty that the spare parts route will work out cheaper. However, the problem arises when companies refresh systems every 3 years you end up needing mixed parts and that can get screwy.

phantom56
phantom56

I buy extended warranties infrequently, mostly depending on the type of equipment: I can fix a desktop PC, so no warranty. I can't easily fix a notebook or my Vaio UX280 micro, so bought extra coverage which saved both. My daughter's laptop lost it's motherboard and the OfficeDepot warranty replaced it at no cost to her. The HDD in my $1500+ UX280 started to go within the ext warranty and it was replaced at no charge. I could not have repaired either. In most other cases, if the cost of the warranty exceeds the replacement cost of the unit, then it is not worth it (unless you don't backup your data!) Jim InfoSystemsAnalyst Pensacola, FL

Komplex
Komplex

And not for sub $200 office equipment. But if we are spending $1,000 for an item then we always get the 3 year service warranty. The only exception I would make is always get the apple extended service plan. You never know when they are going to ship you a total piece of crap.

nick
nick

It keeps writing teh instead of the.

nick
nick

An HDD that packed it in after 3 weeks should be covered by standard warranty not extended warranty. Or do things work differently in USA compared to Australia?

bboyd
bboyd

ebay the part, pop the case, R&R, close the case. Real difficulty is getting a very good price on parts for newer stuff, but that usually falls inside of basic warranty and Credit card protect plans. Save the warranty money and upgrade sooner! Of course I actually enjoy the hardware level of these things and have the minimal tools for doing the repair. 1. Free pocket Philips/Slotted screwdriver. 2. Tweezers/Forceps 3. 2 Plastic spray paint caps for collecting screws. 4. Plastic Tongue depressor for separating plastic gently. 5. Patience

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