How Warranties Work: 3. Basic Types – Full, Extended and Limited Warranties

How Warranties Work: 3. Basic Types – Full, Extended and Limited Warranties

Full Warranties

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.

Golden Ticket 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.

Understand your original warranty first!

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't have that, just a more limited warranty which they happen to be lengthening. If the warranties are the same aside from 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!

I wrote in a previous segment that a manufacturer may limit the length of implied warranties to the duration of the written warranty. This renders the warranty a

Limited Warranty

A limited warranty is a warranty with limitations or conditions. In addition to restricting the implied warranty’s duration, these limitations and exclusions can include:

Which parts are covered. Often the warranty covers the main product, but not accessories. A hand held vacuum cleaning device may have a 3 year warranty which excludes the attachments. Sometimes these come with a little tube with bristles on the end. Who can guarantee bristles for 3 years?

How long each part is covered. A 2 year warranty for an office chair may only cover the rollers for the first 90 days, since they are most likely to be damaged based on how they are used.

Warranty this?

Pond Scum This is pond Scum. It voids most warranties.

The kinds of damage covered. Most computers are not covered for water damage, and their warranties usually make this very clear. Many things can get wet, dry off and still function, like plates. Computers remain outside that group, so it is a reasonable exclusion.

Damages up to a certain amount. Your Sea-Turtle-Safe Pong Lighting Kit may say, “Warranty covers up to $400 in labor and product costs.” These dollar limitations will often be in place when service or labor is part of a warranty.

Limited to first-time purchasers.

I've mentioned this one in earlier segments, where the product is only guaranteed for the initial purchaser. Once it is passed on, sold or given away, the warranty is immediately void. This sounds like a gimmicky way to shorten a warranty, but it actually makes some sense if you think about it. Yes, an object should last as long as it should last no matter who owns it, but on the other hand, when the seller or manufacturer makes the guarantee, they have had possession of the thing up to that point. They know how it has been handled and whether it has ever been dropped or overheated or modified. When I give something to my friend Eddie, how can the manufacturer or original seller know that I didn’t drop it into pond scum for a matter of days at some point? They are no longer in any position to ensure that the product is still in good shape, or is as new as I might present it to be, so it's fair to stop holding them accountable after a resale.

The full series:

pt.1: What is a Warranty

pt.2: Basic Types - Express & Implied Warranties

pt.3: Basic Types – Full, Extended and Limited Warranties

pt.4: Warranty Caveats (the “bewares”)

pt.5: Who is Responsible?

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David 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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