Reading the new washer thread made me think about warranties.
What do you do - and why?
We had one on our AC and appliances for many years. This year we got a new HVAC system, and our warranty people were really frustrating to deal with, so we no longer have one.
We used it for HVAC multiple times, and for both our washer and dryer. It wouldn’t cover our fridge, because it was too old when we got the warranty.
We got a new fridge during COVID, and they are hounding me to get an extended warranty on it. I’m debating.
We don’t ever get extended warranties on our new cars, but when I purchased a used car for kid we did get one.
Whenever we have needed a warranty (extended or regular) it seems that that warranty has expired already. So NO, we don’t buy extra ones.
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My H is big on extended warranties on certain things - like cars and some appliances. But these are extended warranties that we buy from the get-go - not later down the road. Def not the extended warranties that you get via what I call “junk mail”.
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Apparently, I love to swim with my phone. I win–extended warranty company loses.
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Every time I’ve had an extended warranty (save for once) the waiting time, discovery of “covered” issues and more has been nothing but a time suck. I always felt ripped off.
The one that was a positive experience was a new stove. The repair people came to “discover” sent a report, requested approval, and finally ordered parts (all of that was over a month). By week 8 parts were still not received. Luckily the stove was mostly useable. On week 10 I called again. The warranty company sided with me, paid me out 100% the purchase price of the stove plus the warranty cost. I had to sign a paper swearing I was scraping it (I gave it away).
I hate them!
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Nope. Only once did we get one for a car. Many moons ago. Got it through usaa (factory warranty). Never bought one ever again.
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Chances are, you’ll never need it. But if you do – boy, it’s nice to have.
In cars, you could receive full value of the warranty with one major repair. These days it tends to be electronic stuff that goes out, and that gets expensive quickly.
Worst case, you get the warranty and never use it – but I figure it’s hard to put a price tag on peace of mind.
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We buy nice cars but not high end cars (currently have a Subaru and a Honda) - we like to buy certified pre-owned because of the better warranty that often comes. You are 100% right that one or two repairs and it pays for itself. And we have benefitted many times - sometimes not until near the end of the warranty (as the car is getting older) but BOY were we happy to have it!
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Lately I’ve been purchasing a service plan with my gas/electric provider. It’s harder to find independent repairmen these days, and it doesn’t cost that much (right now just my washer/dryer, my otger appliances are either old or crappy -planning a kitchen renovation).
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With Honda and Subaru, I imagine you very rarely have them in the shop except for routine maintenance, oil changes…
I only purchased extended warranties with current and last car. Got a free extended warranty in car prior to that. Had transmission replaced in last car and 2 cars ago, under warranty. No repairs so far in my 2018 car but warranty runs another 4 years.
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I don’t get them because I find them way too expensive. However many credit cards these days offer a 1-year extension on the manufacturer’s warranty for items purchased with the card. It’s in the benefits brochure they send you every now and then printed on the world’s thinnest paper. Might be something worth keeping in the back of your mind.
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Usually no. I think we did once on a whim on a Kenmore vacuum cleaner.
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We have benefitted from
manufacturer’s extended warranties from credit cards and S benefits from Visa signature extended warranty on phones when he pays bills in t-mobile. He cracks and breaks a lot of phones.
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Does Apple Care count? If so, we have done that and have needed and used it.
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Oh I almost forgot- I was having trouble with my phone (possible motherboard issues)and we were in the AT&T store getting the new ipad. They had us get the $17/mo warranty and while I had to pay a deductible, I got a “new” (refurbed) phone with a new battery (my battery had already degraded to 86%). I might cancel that warranty now.
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In general no, but when I do, only from the manufacturer, not a home warranty type company for complex equipment. Home warranties covering HVAC and be particularly bad as they hire young kids, barely train them, and want them to patch the item best they can in as short as time as possible, vs. a real longer-term repair.
Never on a new car.
The last warranty I purchased was on our new furnace, but that was only bcos it was a brand new design to meet California’s new air standards. I was skeptical that the rush to manufacture a totally new heating element would last. Five years in, still works great. But the fancy t-stat was having an issue, so I used the warranty to get that upgraded instead of having it repaired. But it still was well below the cost the original warranty.
Since warranties make a big profit for the company issuing it, by definition, most will not be used by the buyer. So, if you can self-insure, that is the Boglehead way to go.
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The organization selling extending warranties is offering them to make a profit. On average, the warranty seller is expected to come out ahead. Furthermore, there are often limitations or complications when claiming the warranty. Many are surprised to find that common issues are not covered and/or item is not repaired/replaced in the way the expected.
In my opinion, the 2 main reasons to get are extended warranty in spite of it on average being a losing proposition are:
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You have additional information that the seller does not, which makes you believe you are more likely to file a notable claim with the extended warranty than average. For example, paying extra on car battery warranty, if you know your battery always wears down within the warranty replacement period due to hot climate + car model.
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Buying a replacement and/or paying for fixing is problematic for you due to high cost, high stress, etc.
I usually don’t purchase extended warranties, but in the few cases I have, I’ve usually come out ahead, often by a large margin.
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We very rarely buy warranties. But I’m thanking my lucky stars I decided to get one on the HVAC units after we built our home. I bought 10 year parts and labor warranties for all 3 units from the contractor who installed them. I knew there was a risk, but also knew that Florida air conditioners need a lot of care. I think I had all my money back in the first 2 years. The warranties cost me $3000 total and we’ve already had 5 evaporator coils replaced and still have 18 months left on the warranty. Each of those coils runs about $2000 installed.
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The only one we ever bought was for our older Tesla. Money well spent as two door handles broke the year after the initial warranty expired – at $1000+ each!