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Extended Warranties Probably Not Worth It

May 2, 2011 | Parker Waichman LLP

Are extended warranties on big-ticket purchases like appliances a good buy?  Most consumer advocates say these plans, offered by Sears and other retailers, are not worth the added expense.

Sears extended warranties
, as well as similar programs offered by other retailers, usually promise consumers free repairs, replacement if repairs don't work, no hidden fees, yearly service checks and other benefits.  But Consumer Reports says that most of these aren't worth much to the people buying them. According to a survey it conducted in 2009, one-fifth of major appliance shoppers in succumbed to the extended-warranty sales pitch - which is generally very high pressure.  As a result, they paid more than they anticipated on something they didn't need.

Consumer Reports says programs like Sears extended warranties aren't worth it for several reasons, including:

  • Appliances usually don't break during their warranty period, typically three years.
  • If they do break down, the average cost of repairing the appliance is not much more than the average price paid for the warranty.
  • Extended warranties often contain loopholes, such as not covering problems caused by normal wear and tear.


And if internet forums are any indication, consumers who do buy these warranties are often disappointed in the service they receive.   Internet forums are filled with complaints about these programs, many like this referring to a Sears extended warning:



“We have experienced a nightmare trying to get our dishwasher repaired. We have talked to 41 different individuals from Odessa, to Phoenix, to Austin, trying to get it repaired. After calling on Monday (12th), a technician came by and discovered it needed a part. He ordered it and said it would be in Monday and he would be back on Monday to repair it. The part came in Saturday (17th). Sears called us four times to confirm the appointment…each time giving us a different date that they would be there. The technician didn’t show (found out Monday was his day off.) We were rescheduled for yesterday (19th). Sears called to confirm the appointment for the 26th. My wife told them that was unacceptable and after many transfers, finally got someone in Austin that said they would be out today (20th) between 8 & 10AM. Guess What…NO SHOW. My wife called and found out we had been rescheduled for the 28th.” (Complaints Board, 10, 2009).




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