Wednesday, February 07, 2007

Buyer Beware the Extended Camera Warranty – Deal or No Deal

Experience is always life's best teacher. But ideally it is through somebody else's experience that you could learn a valuable lesson about extended warranties.

What is the deal with extended warranties? Are they really an insurance against damage or malfunction?

A seasoned salesperson knows just when to propose the extended warranty; especially, those electronic store sales representatives. When you are high on the purchase the salesperson poses the question, “ Would you like the extended warranty added to this purchase?”. Now they Do NOT review the extended warranty Terms and Conditions (T's & C's) outlining the things that ARE NOT covered by the extended warranty. In fact, some of them purport (Like Future Shop which is part of the Best Buy chain of stores) it is a 'no hassle' insurance. BUNK!

Truth be told, the extended warranty merely extends the manufacturer's warranty and is confined to the same coverage restrictions. It is interesting that the major area where you would want coverage – damage or breakage from impact – IS NOT covered under an extended or a manufacturer's warranty. Review, up front, the details of the extended warranty contract. You will discover lots of exclusions with respect to damage.

Consumer Reports Magazine surveyed tens of thousands of its readers about their repair experience with an extended warranty. The repair cost usually was less than the extended warranty cost. Consumer Reports Magazine concluded from this 2002 research that extended warranties are NOT A GOOD INVESTMENT.

Studies have shown that electronic stores use extended warranties to bolster their profit margins on low margin electronic items. The extended warranty could add 30% to the cost of your purchase. Smooth-talking efforts to sell customers extended warranties is usually part of a sales employee's compensation and job security.

An Extended Warranty seems to be a case of 'buyer beware'. Remember electronic equipment and camera prices drop very quickly. Newer products are introduced every 6 to 12 months forcing that once 'state-of-the-art' item you have to be flushed from manufacturer's inventory at rock bottom prices to retailers and consumers. This short product life-cycle creates a cut-throat competitive retail pricing environment among manufacturers and retail stores. Extended warranty sales improve a retail store's bottom line.

Instead of repairing your damaged camera, consider replacing it via one of the on-line auctions. This bid-price for the exact used [undamaged] product you have could prove less cost than the extended warranty cost. You will have just saved yourself some money and the frustration of arguing with a customer service representative to have an extended warranty claim honored by the retail store.

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14 Comments:

Blogger GoWIN said...

For amateur and professional photographers, the cost of equipment and managing them through warranty has become quite expensive.
This is a very interesting post on warranty and how to be careful while chosing the plan. Invariably we end up losing a lot of money on warranty and insurance, when sometimes a replacement would be more cost effective.
To keep up with the mounting costs of photographic equipment and warranties it's important that amateur and professional photographers should constantly search for new ways to earn a living by earning constant additional income through the photography profession.
There are a number of websites which are willing to payfor submission of good quality amateur photography pictures, this way the cost of warranties and insurance can be offset for any amateur or professional photographer.

Sunday, September 07, 2008 12:32:00 AM  
Anonymous internet marketing services said...

Our cameras are probably one of the biggest investment a photographer has and the warranty is really important. thats why we should be really carefull in getting these extended warrantys if this is legit or waht.

just make sure that these guys are certified and dont trust people or stores that offers worthless promises.

great post.

mc

Friday, March 06, 2009 1:55:00 AM  
Anonymous AutoSpector Inspections said...

Extended warranties are usually never worth the paper they are written on.
I know with bestbuy, you have to take the item in and then they send it to their repair center. The waiting is measured in weeks and they always have a reason not to cover the repairs.

Save your money.

Wednesday, September 30, 2009 6:56:00 AM  
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Friday, December 30, 2011 11:37:00 PM  
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