Are purchased goods better protected by extended warranties?

While shopping around to buy certain types of products, such as white goods and electronic products, sellers may offer consumers the option to extend the standard commercial guarantee by buying an extended warranty. Under an extended guarantee, the guarantor agrees to remedy any specified problem with a product for a certain amount of time after the standard commercial guarantee has expired.

Buying an extended guarantee may be an investment as long as we gather adequate information on the benefits of such guarantees. One of the factors we must consider is the cost of the extended warranty and the probability of using it. We should also consider how much money we spent on the product and what would be the cost of repairing it if it breaks down.

It is also strongly recommended to have a look at the extended warranty’s terms and conditions to see what the warranty exactly covers. A beneficial extended guarantee should at least cover the product purchased for more than two years and should also cover damages caused by wear and tear and accidental damage. We should also check if the guarantee covers both parts and labour.

If it only covers the replacement of parts we should then check the standard rates for repair including call-out charges. Something else to take into consideration are the kind of remedies the extended warranty provides. Does the extended warranty allow for replacement with a new product? Can consumers claim a full refund if the damaged product cannot be repaired or replaced? The more advantages the extended warranty offers, the better for us consumers, as it would be more worthwhile to buy such guarantees.

Before opting to buy an extended warranty, we should shop around and compare different brands and sellers. We should look out and see what other sellers offer as standard commercial guarantees. We may find products that carry standard commercial guarantees that are as beneficial as the extended guarantee we are considering to buy.

Furthermore, we must also be aware that besides the commercial guarantee provided by sellers, the Consumer Affairs Act gives consumers the right to claim a free remedy when the product purchased turns out to be defective within two years from the date of delivery. Any commercial guarantee given to us must provide us with additional benefits. This means that the terms and conditions of commercial guarantees cannot restrict legal rights. Hence, in situations where we may not be entitled to a free remedy due to a restrictive clause in the warranty, such clause may be challenged if the product is still covered by the two-year legal protection.

As consumers, we should remember that buying an extended warranty should always be an option and we should not be pressured by the seller to purchase such protection. We must also make sure that any terms and conditions promised to us should be given to us in writing and must be honoured by the guarantor.

In situations where the guarantor breaches such guarantees we may lodge a complaint with the Office for Consumer Affairs for assistance in dealing with the trader.

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

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