article

Are Extended Warranties Worth the Cost?

By Blanche Evans via Realty Times

bluehammer

Extended warranties offer consumers longer terms of coverage on service, repair and replacement for their home's appliances than the standard out-of-the-box warranty from the manufacturer. These warranties are highly profitable for retailers, as they can run up the total cost of your purchase by $100 or more, with very few claims being filed per year. Are they actually worth it?

You can argue the benefits both ways.

In the fast paced world of home electronics, by the time the extended warranty expires, future technology will far outclass today's. Digitaltrends.com states that household electronics have seen great improvements in product reliability, making the price of most extended warranties about the same as a repair bill. The same is true with most appliances today too.

Consumerreports.com agrees. Their data concludes that the likelihood of most home appliances needing repairs in the first three years is less than one in five. And most defects will reveal themselves within the first year of use, while the manufacturer's warranty is still good.

That said, extended warranties should be purchased for some items, including those that are difficult to repair or high-priced items that would be painful to replace. These include high ticket items like a $6000 Viking gas range or pricey hi-definition plasma TVs, suggests smartmoney.com

Since extended warranties do make so much profit for retailers, they are very aggressive about selling them to customers. If you're tempted, follow this rule -- the cost of the warranty should be no more than 10% of the purchase price.

And if you decide to skip the warranty, be prepared to shoulder the cost for assessment (service calls), repair (time in labor plus parts) and shipping. Though it's more of a hassle, this can be the most cost-effective measure. If you have a warranty option of $250 and you experience only one instance in the life of your appliance where it needs $100 of work, you could save $150, or 60%.

Ultimately the choice and risk are yours to assume. Extended warranties can be worth the cost in terms of peace of mind, but only if it's for a product you don't intend to change for a few years.

Want to estimate your home improvement costs before talking with a contractor? Claim your home for free with bluehammer to estimate costs, secure your home inventory and learn more about your home.

* THIS REPORT IS AN OPINION THAT MAY BE INACCURATE AND IS PROVIDED SOLELY AS AN INFORMATIONAL TOOL NOT DESIGNED TO PROVIDE DEFINITIVE ANSWERS. ALL ELEMENTS ARE OFFERED "AS IS" AND BLUEBOOK EXPRESSLY DISCLAIM ANY AND ALL WARRANTIES, REPRESENTATIONS, AND GUARANTEES OF ANY NATURE, EXPRESS, IMPLIED OR OTHERWISE, INCLUDING BUT NOT LIMITED TO ANY IMPLIED WARRANTIES OF MERCHANTABLITILY, NONINFRINGEMENT, TITLE, QUIET ENJOYMENT, ACCURACY, OR FITNESS FOR A PARTICULAR PURPOSE. IN NO EVENT SHALL BLUEBOOK (OR THEIR SUPPLIERS) BE LIABLE FOR ANY GENERAL, DIRECT, SPECIAL, INCIDENTAL, INDIRECT OR CONSEQUENTIAL DAMAGES OF ANY KIND, OR ANY DAMAGES WHATSOEVER (INCLUDING WITHOUT LIMITATION, THOSE RESULTING FROM USE OF THE PRODUCT, INCLUDING : (1) RELIANCE ON THE MATERIALS PRESENTED, (2) COSTS OF REPLACEMENT GOODS, (3) LOSS OF USE, DATA OR PROFITS, (4) DELAYS OR BUSINESS INTERRUPTIONS, (5) AND ANY THEORY OF LIABILITY, ARISING OUT OF OR IN CONNECTION WITH THE USE OR PERFORMANCE OF INFORMATION) WHETHER OR NOT BLUEBOOK HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.

Know what you should pay for your home improvement projects with bluehammer.Claim your home. It's free!

Popular


Is School Improvement Part of Your Ownership Strategy?

Neighborhoods with good schools often carry higher value for home buyers with children, so if you want to raise values in your neighborhood, supporting school improvement may be a valuable undertaking.

How to Upkeep Your Home So Neighbors Are In Awe

Homeowners are responsible for the quality of their home with the maintenance and care that they provide for the building throughout the year. Every home requires a specific amount of upkeep to ensure that it maintains its value and has a high level of appeal. To keep your neighbors in awe of your home, there are a few important steps to take to allow it to stand out in the local area.

Replacing Your Bathroom Vanity

Replacing your old vanity can make a big aesthetic difference in your bathroom.

You Really Should Inventory Your Personal Property

A home inventory is a smart way to safeguard your valuables, saving money and time.

Choosing The Best Hardwood Floors For Your Home

The rich patina of wood floors adds beauty and elegance to any home.

How To Create A Great Accent Wall

Bringing color into your space doesn't require you to splash paint up everywhere. Sometimes, focusing on just one wall can have even greater impact, or at least allow you to slowly get used to the idea of color before you take the four-wall plunge.

The Best Paint Colors For An Enduring Look In Your Home

Trends come and go. If you paint your walls the "provocative and thoughtful purple shade" of Ultra Violet, as Pantone, itself, calls it, you're probably gearing up to repaint them in whatever the color authority deems the "it" shade next year. If you'd rather pick a paint chip or two and keep your space the same for the long haul, you'll love these colors that endure.

10 DIY Peel-And-Stick Tiles To Quickly Take Your Backsplash From Meh To Magnificent

Adding a flashy backsplash is one of the best ways to help transform your kitchen, and, especially, to take the emphasis off of countertops that might need updating or cabinets in need of an overhaul. It could also inspire you to make those other needed changes. But the hassle of working with tile and stone and dealing with messy thinset and grout - or paying someone to do it for you - often wins out over going for it.

Tips For Decorating Rooms That Are Long And Narrow

Distract attention away from an awkward room shape and create a pleasing design using these pro tips.

7 Simple & Smart Basement Repairs to Consider

No space in your home is more accommodating and homey, or conversely scary, than your basement. A nicely finished basement can be the entertainment centerpiece of your entire home, housing your big-screen TV, the most comfortable couches in the place and a warm, inviting atmosphere that wraps each guest in comfort.

See More Articles