Extended warrantys - do you need them?

[finfan1966]

I just bought a new receiver from Vanns that I am pretty excited about. It was the Onkyo TXNR3008. They had it for $1230.00 with no tax and free shipping. The receiver comes with a Onkyo manufactures warranty for 2 years. On Onkyo's website you can even purchase a 2 year extension warranty for $85.00. So that's 4 years of coverage for $85.00. The only draw back is if something happens I have to drive it to the nearest authorized service center which is about an hour and a half drive.

The other choice is buy Vann's extended warranty for $125.00 for 3 years. So really you are only getting one year extra after the manufactures warranty runs out. However Vann's will pay for shipping each way and if they can't fix it - they will give you the total cost of what you paid for your receiver.

If you had a choice what would you do? Just curious because sometimes I will buy an extended warranty and sometimes I won't.

 

[BoredSysAdmin]

I just bought a new receiver from Vanns that I am pretty excited about. It was the Onkyo TXNR3008. They had it for $1230.00 with no tax and free shipping. The receiver comes with a Onkyo manufactures warranty for 2 years. On Onkyo's website you can even purchase a 2 year extension warranty for $85.00. So that's 4 years of coverage for $85.00. The only draw back is if something happens I have to drive it to the nearest authorized service center which is about an hour and a half drive.

The other choice is buy Vann's extended warranty for $125.00 for 3 years. So really you are only getting one year extra after the manufactures warranty runs out. However Vann's will pay for shipping each way and if they can't fix it - they will give you the total cost of what you paid for your receiver.

If you had a choice what would you do? Just curious because sometimes I will buy an extended warranty and sometimes I won't.

The only use for extended warranty for me would be in big box h&m store as a leverage to negotiate a better deal on the product bundled with extended warranty and then return the warranty - yes, it's possible (tested with Best Buy)

 

[its phillip]

I hardly ever buy warranties and when I do they're usually from squaretrade...but that 2 year extension for $85 sounds good, even with the long drive.

 

[sholling]

I hardly ever buy warranties and when I do they're usually from squaretrade...but that 2 year extension for $85 sounds good, even with the long drive.

+1. I generally don't buy extended warranties unless it's something likely to die and expensive to fix (laptop computers etc) but $85 for a factory warranty is cheap enough that I'd be tempted.

 

[mperfct]

I hardly ever buy warranties and when I do they're usually from squaretrade...but that 2 year extension for $85 sounds good, even with the long drive.

I agree, check with squaretrade to see what their offer would be. I rarely buy extended warranties. It's kind of giving your money away, imho.

 

[finfan1966]

I agree, check with squaretrade to see what their offer would be. I rarely buy extended warranties. It's kind of giving your money away, imho.

Square trades wanted $144.00 for a 3 year warranty.

 

[its phillip]

I'd definitely go with the $85 factory warranty then

 

[MDS]

I wouldn't buy ANY extended warranty, it's just a waste of money.

Electronics either die fairly quickly (known as 'infant mortality', which is a rather gruesome term for the phenomenon) or work fine for years and years. Now some people will say 'yeah well I bought this thingamajob and it died one day after the warrany expired so you should buy an extended warranty to protect yourself'. It's an illogical argument and here's why:

- The insurance company has far more statistics on failure rates for particular classes of devices than you, the consumer, does.

- Any device/brand that is known to have a high failure rate, will NOT be offered an extended warranty. Insurance companies are in the business of collecting premiums, not paying out claims.

- Add in the cost of packing and shipping or transporting it yourself to the warranty center and the time lost while you wait for it to be 'fixed' and your true cost is much more than the seemingly 'low' price for the insurance.

It's just not worth it...

 

[BoredSysAdmin]

I wouldn't buy ANY extended warranty, it's just a waste of money.

Electronics either die fairly quickly (known as 'infant mortality', which is a rather gruesome term for the phenomenon) or work fine for years and years. Now some people will say 'yeah well I bought this thingamajob and it died one day after the warrany expired so you should buy an extended warranty to protect yourself'. It's an illogical argument and here's why:

- The insurance company has far more statistics on failure rates for particular classes of devices than you, the consumer, does.

- Any device/brand that is known to have a high failure rate, will NOT be offered an extended warranty. Insurance companies are in the business of collecting premiums, not paying out claims.

- Add in the cost of packing and shipping or transporting it yourself to the warranty center and the time lost while you wait for it to be 'fixed' and your true cost is much more than the seemingly 'low' price for the insurance.

It's just not worth it...

+1 but you still have at-least one reason to buy them as I stated above. DO Check your store return policy prior to trying this.

 

[rgriffin25]

I wouldn't buy the warranty either. In the 10 years I've been working in Sales/Service I have only seen a couple of receivers fail. Both of them were defective out of the box.

 

[aberkowitz]

I wouldn't buy ANY extended warranty, it's just a waste of money.

Electronics either die fairly quickly (known as 'infant mortality', which is a rather gruesome term for the phenomenon) or work fine for years and years. Now some people will say 'yeah well I bought this thingamajob and it died one day after the warrany expired so you should buy an extended warranty to protect yourself'. It's an illogical argument and here's why:

- The insurance company has far more statistics on failure rates for particular classes of devices than you, the consumer, does.

- Any device/brand that is known to have a high failure rate, will NOT be offered an extended warranty. Insurance companies are in the business of collecting premiums, not paying out claims.

- Add in the cost of packing and shipping or transporting it yourself to the warranty center and the time lost while you wait for it to be 'fixed' and your true cost is much more than the seemingly 'low' price for the insurance.

It's just not worth it...

Extended warranties are never worth it from a mathematical perspective- this is why companies love to offer them... nice source of free money.

 

[highfigh]

I just bought a new receiver from Vanns that I am pretty excited about. It was the Onkyo TXNR3008. They had it for $1230.00 with no tax and free shipping. The receiver comes with a Onkyo manufactures warranty for 2 years. On Onkyo's website you can even purchase a 2 year extension warranty for $85.00. So that's 4 years of coverage for $85.00. The only draw back is if something happens I have to drive it to the nearest authorized service center which is about an hour and a half drive.

The other choice is buy Vann's extended warranty for $125.00 for 3 years. So really you are only getting one year extra after the manufactures warranty runs out. However Vann's will pay for shipping each way and if they can't fix it - they will give you the total cost of what you paid for your receiver.

If you had a choice what would you do? Just curious because sometimes I will buy an extended warranty and sometimes I won't.

Why do you have to drive it there? If you have the original box, ship it if it's more convenient and cheaper. If the price paid is reasonable enough and $125 isn't a deal-breaker, I'd consider it. $1300 for something that could die in two years or less isn't acceptable, IMO. Obviously, if the piece is cheap, the warranty isn't a good idea but when I did car audio, I sold a lot of extended warranties because A) it was in a hostile environment, B) it wasn't very expensive and C) It paid for removal and re-installation. If it pays for shipping, I would say it's not a bad price- a receiver would cost at least $35 to ship one way, so the $70 saved almost pays for the warranty, without even considering any service performed.

 

[highfigh]

Extended warranties are never worth it from a mathematical perspective- this is why companies love to offer them... nice source of free money.

I wouldn't say 'never'. We have a dealer in MKE who is an authorized service shop for Sony, Samsung, Hitachi, LG, Panasonic, Sharp and many others. Last year, they were doing almost $70K/month in Sony LCD panel replacements. Samsung had a problem with power supply caps and it costs about $175 just to replace the board in a 32" LCD TV, without the time and gas needed to get it to the shop as an out of warranty job. I know someone with a 2 year-old Sammy who needs this and it would have cost far less to have the extended warranty.

 

[Pyrrho]

I just bought a new receiver from Vanns that I am pretty excited about. It was the Onkyo TXNR3008. They had it for $1230.00 with no tax and free shipping. The receiver comes with a Onkyo manufactures warranty for 2 years. On Onkyo's website you can even purchase a 2 year extension warranty for $85.00. So that's 4 years of coverage for $85.00. The only draw back is if something happens I have to drive it to the nearest authorized service center which is about an hour and a half drive.

The other choice is buy Vann's extended warranty for $125.00 for 3 years. So really you are only getting one year extra after the manufactures warranty runs out. However Vann's will pay for shipping each way and if they can't fix it - they will give you the total cost of what you paid for your receiver.

If you had a choice what would you do? Just curious because sometimes I will buy an extended warranty and sometimes I won't.

The question for you is a two parter:

First, do you expect the device to fail after 2 years, but before 4 years? Basically, if you buy 2 years of extension on your two year warranty, you are betting that the item will fail after 2 years but before 4 years, and fail in a manner covered by the warranty. If it does not fail between 2 and 4 years, you are out your money for nothing in return.

Second, if it does fail, can you afford the loss? This second question is important because, unless the insurance company has made a mistake, you are likely paying for nothing with your extended warranty. Insurance only makes sense if the loss will be a significant hardship for you; otherwise, you are wasting money.

Basically, with anything that tends to be reliable, extended warranties are a waste of money, and things themselves that are unreliable are a waste of money, so even if you win your bet, you lose because you bought a piece of garbage.

 

[highfigh]

I wouldn't buy the warranty either. In the 10 years I've been working in Sales/Service I have only seen a couple of receivers fail. Both of them were defective out of the box.

Do you see every piece that comes in? I work for myself and I have seen one receiver with a dead network card out of the box, one that went t#ts up after a couple of weeks (my demo) and my replacement did a hard reset on its own this week. I have no power issues, either. Clear sky, calm night- Monday, it was fine and Tuesday AM, it was a blank slate. This is since last Summer. Electronic devices fail and there's not much we can do about it when they aim for 1-1/2% to 2% failure rate.

 

[psbfan9]

I'm coming to the end of my manufacturer's warranty on my LG (model:LG 47LD650) tv. Of course I'm getting emails from LG 'premium care' extended warranty service. In home service for $170.00 for 3 years. This kicks in after the manufacturer's warranty ends, so it is a full 3 years.
I started to do some checking and found that there are a few other companies that offer 'extended' warranties. Square Trade, all ready mentioned, but there is also a company called DTV Express

http://www.dtvexpress.com/

You have to purchase their (DTV) warranty within 6 months of purchase date.

I'm considering the LG premium care warranty. That $170.00 may be well spent.
Any thoughts?

I apologize to the OP for changing this from a receiver to a tv, but I didn't think it was necessary to start a new thread.

 

[Midwesthonky]

Extended warranties were awesome for cash flow when I worked in the appliance industry. Even though there were branded with our company name (the manufacturer) it was really a third party extended warranty. People sell them because they are a profitable sell.

As someone already stated, it is simply insurance against a problem within that period of time between the manufacturer's warranty and the time on the extended warranty. So as already stated, if it fails between 2 & 4 years, will it be a hardship for you to replace it? If so, seriously consider the extended warranty. If not, then I would not. It is insurance, pure and simple.

I have bought extended warranties before I really understood the business end of it. Never was able to file a claim. I had one years ago on a pickup but the repairs never exceeded the deductable on the extended warranty so I could never file a claim. Haven't bought one since.

Or another angle, if it did fail in say 3 years, would you want to repair it or would you rather go get something new that has 3 years newer technology?

 

[timoteo]

Normally i would say not to buy the warrany. However we are talking about an Onkyo here!!

With their recent history i would highly recommend getting some extra coverage.

 

[highfigh]

I'd think about it if I was buying an expensive display- the cost of a replacement screen is insane. Another reason for an extended warranty is for things that are in hostile environments, like a car or boat stereo. Where I worked, the extended warranty covered removal and re-installation if it had a problem during that period. Removing and re-installation was free during the first month but after that, we charged for it but the cost of the removal/re-installation would cover the three year extension. The factory warranty doesn't cover removal/re-installation, so....

 

[skizzerflake]

Extended warranties are a gambler's proposition. True, most receivers are quite reliable and, not abused, will last much longer than a couple years, but, here and there, there are a few bad ones. It's safe to assume that the cost of one repair is greater than the cost of the warranty. So, you are gambling that the receiver will blow up before you are finished with it and so you buy the warranty. The company, on the other hand, is gambling that the receiver will outlive the warranty.

The problem is, that the company is playing with a stacked deck. They know what percentage of units will fail and how much they cost to fix and they price the warranty so they don't lose on it. I've had a lot of components over the years, never bought a warranty and the only ones I have lost were due to an "act of God" (a lightning strike, covered by insurance), so, if at this point, my new HT receiver burns up prematurely, over the long haul, I am still ahead, having not paid for extra warranties.