When shopping for certain products, such as an electronic product or a home appliance, consumers may be offered the possibility to pay an additional amount of money in exchange for an extended warranty. These guarantees provide an extended protection once the standard guarantee expires.
Before paying more money to better protect their purchase, consumers need to evaluate the real benefits these type of guarantees provide. Consumers should take a close look at the guarantee’s terms and conditions. They should ask to see a copy of the conditions before making up their mind and for instance check what defects are covered.
Most warranties only cover mechanical breakdowns, not wear and tear or accidental damage. Special attention should also be given to the benefits the guarantee offers. Does it offer new for old or just repair? If it only offers repair, consumers must check that both labour cost and replacement of parts are included in the guarantee. What about transport of the defective good? Is it included in the guarantee or not? The more advantages the extended warranty offers, the more consumers would benefit if they decide to purchase such a guarantee.
Another factor to consider before buying an extended warranty is its cost and the likelihood of having to use it. An extended warranty is usually worth its price if the product is covered is very expensive.
Consumers should also weigh the cost of the extra guarantee against the cost of replacing the item or repairing it outside the guarantee period. Furthermore, before consumers decide to pay more money for an extended warranty they should shop around and see what other retailers have to offer with standard commercial guarantees. There may be different brands that offer a better free commercial warranty.
Consumers need also to be aware that, over and above the guarantee given by sellers, the Consumer Affairs Act provides a legal protection that is valid for two years from the date the product purchased is delivered to consumers. This protection entitles consumers to claim a free remedy if: the product purchased does not match the description and specifications in the contract of sale; is not fit for its intended purpose; is not fit for the particular purpose for which the consumer requires it and made this known to the trader at the time of sale; or if it does not show the quality and performance which is normal in goods of the same type.
When such situations arise consumers may firstly request that the goods are repaired or replaced free of charge. Reduction in price or termination of the contract can be claimed when neither repair nor replacement are possible solutions, or if opted for may cause a significant inconvenience to consumers. Hence, before buying an extended warranty, consumers should make sure that it offers more protection than the law.
Consumers should not be pressured into buying an optional extended warranty. If they decide to purchase such a guarantee, they should ensure that its terms and conditions are given to them in writing and must be fully honoured by the guarantor.
Odette Vella is director, Information, Education and Research Directorate, Office for Consumer Affairs, Malta Competition and Consumer Affairs Authority.
odette.vella@mccaa.org.mt