The Original IT Company

Are Extended Warranties Worth The Money?

July 26, 2010

Seems like you can’t purchase any electronic device without being offered an extended warranty—but is it a good investment? According to a recent poll of over 2,000 readers of PC World magazine, 63% said they always go for the extended warranty plan; and of those who had to use it, 80% were satisfied with the service. Does that mean they are a good investment?

In our opinion, unless the device you are buying is a critical, single point of failure (like a server) extended warranties are not necessary. Most bugs will reveal themselves within the first 90 days of purchasing a technical gadget, which is well within the normal warranty of the product. But if you feel better buying an extended warranty, here are 5 tips to follow:

  1. Read the terms before you buy: You don't have to read the warranty in the checkout line—take it home. You can usually buy it later.
  2. Beware shipping charges: If the product needs to be sent in for service, you could get stuck with the tab.
  3. Look for accidental damage coverage: Most policies do not cover products that are damaged from falls or spilled coffee. If that option is available, you  might have to pay more for it (a good idea, particularly for mobile devices  that get abused). 
  4. Look for extras: Many extended warranties cover replaceable items, such as bulbs in projectors which are expensive and can wear out.
  5. Check for the product’s reliability online first. If you are buying a quality product, an extended warranty might not be necessary. Obviously doing a little research and spending a bit more on a better built product will save you a lot of time and aggravation in the long run anyway. You can find some good information in PC World's annual Reliability and Service survey and Consumer Reports' reliability ratings.

As noted before, if you are purchasing a critical device such as a file server which will have a significant negative impact if it fails, it pays to maintain a manufacture warranty. All quality business servers come with a manufacture three year warranty. In fact, when you see those inexpensive servers offered by the big names, with only a one year warranty, you know these servers are NOT business grade, rather a consumer grade PC dressed up as a server. Avoid them at all costs!

Of course, you can always call us for our opinion since we have to fix the PCs, servers, and other gadgets for multiple clients!

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