Consumers may sometimes find themselves in situations where before buying a home appliance or an electronic good, the retailer offers them the possibility to buy an extended warranty. In such a scenario they must be careful not to pay for a protection they already have.

What is an extended warranty?

Basically, an extended warranty is a prolonged warranty at an extra cost. Usually such a warranty is purchased so that if something goes wrong with the product after the standard guarantee expires, the consumer can still claim a free remedy.

Before deciding to go for an extended warranty, consumers should first inform themselves about the additional benefits such a warranty offers.

Since these type of products usually carry a standard warranty included in the price, consumers should shop around to obtain information of what various sellers offer as standard guarantees and to compare prices.

Furthermore, consumers must be aware of their legal rights. The law entitles them to a free remedy if the product purchased does not conform to the contract of sale. When this happens, the defective or non-conforming goods must be repaired or replaced free of charge.

If these two remedies are either not possible or result inconvenient to consumers, then part or full refund of the money paid may be opted for. Consumers are entitled to these remedies for up to two years from the date of delivery of the product purchased.

Any other guarantee given to consumers by sellers does not replace these statutory rights. On the contrary, the commercial guarantee should provide additional benefits to consumers. This means that the terms and conditions of the commercial guarantee cannot reduce consumers’ rights. Hence if consumers are not entitled to compensation due to a restrictive clause in the warranty, such a clause may be challenged if the product is still covered by the two-year legal protection.

Is it worth buying an extended warranty?

To determine whether or not an extended warranty is worth buying, consumers should take a close look at its terms and conditions and evaluate its benefits. They should be aware that warranties do not usually cover all problems. Most warranties only cover mechanical breakdowns, not wear and tear or accidental damage.

Consumers must be aware of their legal rights

Consumers must also look for the remedies extended warranties offer. Do they offer new for old or just repair? If they only offer repair, consumers should double check that both labour and parts are included.

Buyers should also enquire whether damages caused by accident or misuse are also covered. The more advantages the extended warranty provides, the more consumers would benefit if they decide to invest their money in such a guarantee.

Another factor to consider is the cost of the warranty and the likelihood of using it. Consumers should take into consideration the money they are spending on the product and the cost of repairing or replacing the product if it breaks down.

Consumers must not be pressured to buy an extended warranty as it should be an option not a mandatory requirement. Furthermore, the terms and conditions of commercial and extended guarantees must be provided in writing to consumers and must be honoured by the guarantor.

odette.vella@mccaa.org.mt

Odette Vella is director, Information, Education and Research Directorate, Office for Consumer Affairs, Malta Competition and Consumer Affairs Authority.