November 21, 2014

You Probably Don’t Need That Extended Warranty

Straight from PR Newswire: J.D. Power and Associates Reports: High Reliability of Major Home Appliances May Reduce Need for Extended Warranties

According to J.D. Powers and Associates 2007 Major Home Appliance Study, most major appliances these days are quite reliable, yet many consumers continue to purchase extended warranties.

The study measures customer satisfaction in nine segments of major home appliances: dishwashers; free-standing ranges; built-in cook-tops and wall ovens; freezer-on-top style refrigerators; side-by-side and French door-style refrigerators; clothes washers; clothes dryers; over-the-range microwave ovens; and counter-top microwave ovens. The study, now in its third year, examines customer satisfaction with microwave ovens for the first time. Customer satisfaction is measured based on performance in six factors: operational performance (including how well the appliance functions, noise level and energy efficiency); operational features (such as the number of settings available and appliance capacity); ease of use; styling and feel; price; and warranty.

The study finds that during the first two years of ownership, approximately one in 10 consumers report some kind of problem with their major appliance. However, many of these problems can be resolved by following instructions in the owner’s manual or on the manufacturer’s Web site. Relatively few problems actually require a service visit.

Despite this high degree of reliability, many consumers purchase an extended warranty for their appliances. Among owners of refrigerators, stoves, dishwashers and laundry appliances, approximately 25 percent report purchasing an extended warranty, while approximately 15 percent of microwave oven owners do so.

“Extended warranties certainly provide a degree of peace of mind,” said Dale Haines, senior director of the real estate and construction industries practice at J.D. Power and Associates. “With some appliances — particularly those with complex electronics and potentially high repair costs — purchasing an extended warranty may make sense. However, major appliances tend to be very reliable, and consumers should consider very carefully — depending upon their circumstances — whether an extended warranty is worth the additional cost.”

In satisfying customers with major kitchen and laundry appliances, Bosch, GE Appliances, Kenmore, LG, Maytag, Samsung, Whirlpool and Whirlpool Gold rank highest in various segments.

“Particularly strong performers include Bosch, LG and Samsung, which have achieved consistently high satisfaction levels in consecutive years,” said Dale Haines, senior director of the real estate and construction industries practice at J.D. Power and Associates. “For two consecutive years, Bosch has ranked highest in the dishwashers segment and LG has ranked highest among clothes washers, while Samsung has earned an award in a refrigerator segment for three consecutive years. This is especially impressive considering the high levels of quality and reliability that many appliance manufacturers attain.”

The 2007 Major Home Appliance Study is based on 22,637 responses from consumers who purchased one or more new major home appliances through a retail store, their new-home builder, or received one through other means (such as a gift) during the previous 24 months.

Comments

  1. dont believe everything you hear about these extended warranties. Ive been selling these for 20 years and yes odds are you Prob wont use it, but if you do need service after the MFG warrantie good luck. Most service companies will charge you $100 just to come to the house and ck out the appliance. If you need parts or work done, the labor is typically $50-$60 per hour plus parts. And if you think the Manufatureing co will help you out, think again, they wont help after the warranty has expired. And the Store you bought it from also cant help, they didn t make the appliance so any future problems go back to the MFG> co..again they wont help. The cost of most appliance warranties start at $99. One service call after the Mfg warranty will cover that cost, and that extended warranty will last for 4 more years no matter how many times you use it. At $100 for the contract it breaks down to $25 a year.
    I just get tired of hearing from cust complaining that the mfg wont do anything for them when they refused to purchase the extended warranty at the time of the appliance purchase. Dont blame the sales person or the store if service on your 18 month old range costs you $200, and the manufacurere wont do anything for you. sorry you had your chance when you bought the appliance.

  2. Most warranties are undrewritten by a national service contract co. and does not matter where you purchased it, If you move from Maine to New Mexico it is still good., You plan is not with the store. It also cover ALL parts and All labor including the initial call.

  3. So the sales person that makes a commission on the extended warranty thinks they are a good idea? Shocker…

    Look here is how I handle this and Im not saying it will work for you it is just how I have chosen to handle this age old problem.

    If the appliance you are buying is under $300.00 paying an additional $50.00 for a warranty is not cost effective.
    If you are buying a refrigerator or an expensive oven I would recommend you go ahead and cover your self.

    I had continuing education in the electronics field my professor gave us some advise that I still adhere to today some 15 years latter.

    When you buy a piece of electronic equipment take it home and immediately turn it on, then leave it on for 24 hours.
    If there is a problem with your item will arise in that first long use. In most states if you return an item less than 48 hours after you buy it with a problem they HAVE to replace it.

    Good luck all, and remember no one is out to get you sometimes things happen and items break. Its life. Buy American when you can and you will never be disappointed with the results you receive.

  4. thanks so much for this. Now I bought a $600 dryer from LG and it a piece a garbage broke right after the warranty. Of course it’s going to cost $450 to fix it. wish I would have bought the extended warranty from Best Buy. I will never purchase another item from LG ever again!!!!