How Warranties Work: Basic Types of Warranties – Full and Extended Warranties
Posted on Oct 17th 2012 Posted by David — Comments ↓
A full warranty is the golden ticket in warranty land, and probably as rare of a thing to find too. I’ve found it on things like some Craftsman tools and Wüsthof knives. When you spend $70 or more on a single knife, you're buying not just a good blade, but the security of knowing that you have the Good Blade question pretty much settled for life. Wüsthof knows this, so they build in that guarantee and justify the price they charge with a full warranty.With a full warranty there is no limit on:
- The duration of the warranty: You may return the product for repair or replacement at any time.
- Service covered: All service is free to the customer, including costs associated with shipping it, or having it removed where installed.
- Remedies offered: After a reasonable number of attempts
to repair to full functionality, the customer may choose whether to get a new one in replacement, or to have a full refund. Note - the CUSTOMER chooses that. See how good these are?
- Ownership: The warranty goes with the product if it is sold or given away.
- Maintenance: Customers have no direct maintenance duties to keep the warranty in force. If the item is serviceable, service is provided free on the sole condition that the owner arranges that when it is needed.
Extended Warranties (aka Service Contracts)
For sale when most home electronics are purchased, usually at around 10% of the cost of the item, these additional warranties should be approached with caution. The pitch is usually that they either extend the duration of the manufacturer’s warranty, or render a limited warranty less limited, or both. Sometimes they actually do these things, and sometimes they merely duplicate the existing warranty. Either way, they are huge profit generators for the businesses that sell them.
[caption id="attachment_2833" align="alignright" width="300" caption="Understand your original warranty first!"][/caption]
The best thing you can do is make sure that you understand the original warranty first, then look at what they have to offer and consider whether the benefit is worth what they are asking. Remember that you are always legally entitled to examine any warranty documentation before purchasing any item (even if they have to open the box!), but in this case you can even take your purchase home and take your time looking over the warranties. That's because any extended warranty offer is available, by law, for 30 days after the original purchase. If the sales person says that you have to buy it at the time of purchase, they are wrong or are lying.
If the extension is of the duration of the original warranty, then essentially you have two warranties. One is with the manufacturer, and one is with the store which begins when the manufacturer's one ends. If that’s all the warranty does, then there should be no “no problem return” claims made when selling you the extension. You either already have a no problem return and they're merely lengthening the valid time period, or you don' have that, just a more limited warranty which they happen to be lengthening. If the warranties are the same aside form length, then you should get the exact same service on any return within the covered time period.
Now if the original warranty is “full” as described above, then it is hard to imagine what they have to offer. Full really is about as good as it can get!
Next up: Limited Warranties
The full series:
pt.1: What is a Warranty?
pt.2: Which Law Governs Warranties?
pt.3: The Express Warranty
pt.4: Implied Warranty #1
pt.5: Implied Warranty #2
pt.6: Full and Extended Warranties
pt.7: The Limited Warranty
pt.8: The Caveats (the “bewares”)
pt.9: Used and “As Is” Sales
pt.10: Who is Responsible?
pt.11: How Warranties Work: Who is Responsible? The Installer? The Shipper?
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David is has written and made videos about flooring products and installation since 2011 at Floors To Your Home (.com), where he is also the PPC Manager, a Researcher, a Website & Marketing Strategy Team member, Videographer, Social Strategist, Photographer and all around Resource Jito. In my spare time I shoot and edit video, put together a podcast, explore film history, and mix music (as in ‘play with Beatles multi-tracks’). Connect with W. David Lichty
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