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


8 Paint Colors for a Standout Front Door?

Extend a standout greeting with a memorable hue at your home's entry

Replacing Your Water Heater

Hot water is a luxury we all take for granted until it goes cold.

Is Your Home A Burglar Magnet?

The thought of a home break-in is terrifying, but are you doing everything you can to prevent one? You might be making critical mistakes that make your home a burglar magnet, or, at least failing to take advantage of easy fixes to make your home less attractive to thieves.

Replacing Your Washing Machine

With moving parts, water and dirt, washing machines perform some tough work.

How To Create A Statement Ceiling

Are things looking up in your home? How about people? If there's nothing to draw their eye up, you may be missing out on a great decorating opportunity. Today, the ceiling is being called the "fifth wall," and it's a great place to add color, texture, and interest to a space that is often ignored.

Choosing Window Treatments: Pros and Cons

Deciding on the right size, color, fabric and pillow configuration for your couch took three weeks. You still haven't decided on the paint color for the bedroom, despite having seven different shades of blue in swatches up on the wall. It seems like every design decision you've made in your home was critical, but the one that will help pull it all together hasn't garnered a moment of thought.

Essential Garage Equipment for Car Enthusiasts

What makes a car enthusiast? The vehicle you own says a lot about your passion for cars. About 12 percent of Americans are loyal to a particular vehicle brand, and vehicle brand loyal customers are four times more likely than other consumers to describe themselves as car enthusiasts, according to Scarborough. What you have in your garage also makes a statement about your love of cars. Here are some essential items every car enthusiast should have.

Tips For Selecting An Interior Door

Take a minute to count the number of doors in your house. Surprising, right? Consider then, the impact that a little attention to the doors can have on the overall style and design of your home. Whether you're just moving in or staging for a sale, new doors are a simple way to dramatically update the space. The good news is that there are as many styles of doors as there are doors in your home. Making the decision is the toughest part.

Find The Right Interior Doors For Your Home

Take a minute to count the number of doors in your house. Surprising, right? Consider then, the impact that a little attention to the doors can have on the overall style and design of your home. Whether you're just moving in or staging for a sale, new doors are a simple way to dramatically update the space. The good news is that there are as many styles of doors as there are doors in your home. Making the decision is the toughest part.

Making Your Home More Energy-Efficient

Your home is your place to rest, play, and spend time with your family. It should be a place of comfort, and this comfort need not come at a high cost. Many homes, however, waste a lot of energy in ways that can be prevented. Here are five ways to make your home more energy-efficient.

See More Articles