How to decide if an electronics warranty or product protection plan is worth buying?

1 Answer

Answer :

It can be rather difficult to tell at times whether or not a warranty or protection plan that a salesman is offering you is actually worth it. Confounded by various technical details, price points, questions about cloud computing and internal storage, the value of a good warranty versus being taken on a bad deal is often-times too much for a rattled mind. There are a few general considerations to take into account before making the final purchase which can make this decision a great deal easier.What sort of electronic product are you buying?The validity of any warranty relies on the risk / reward judgment of the product itself. Items with a great many different parts and sensitive structures are better candidates for a protection plan with your purchase than items which do not move often or are sturdier by nature. For example, while it is a good idea to protect computers in general with a good warranty, desktop computers are much more reliable and easily repaired than laptop computers, and as such laptop computers should be covered by warranty in more instances than a desktop might.Products that frequently do not require warranty repair or replacement would be printers (partially due to the stationary nature of the printer, partially due to the fact that printers take proprietary cartridges for each model in most cases and are cycled out frequently by manufacturers), paper shredders, external storage solutions such as USB or SD drives (external hard-drives sit on the fence depending on brand and build quality) and routers or network switches.On the other hand, products that do require more frequent coverage include laptop computers, tablet computers, and digital cameras. In all of these cases, if accidental coverage is offered at a reasonable price it is justifiable to purchase it – particularly in the case of tablets and cameras which are frequently handled and often dropped or misplaced in a risky area (car seats, chairs, tabletops).What is the price of the warranty versus the price of the product?This is a big one, and should always be considered during the purchase. In most cases when dealing with electronics, additional warranties above and beyond the built-in manufacturer's warranty are tied to the price point and type of product you are buying. Of course, items with a higher hardware failure rate will likely be a bit more expensive to cover via warranty than those with a relatively low risk, and so laptops or tablets are often more pricey than desktops of the same variety.Regardless of these conditions, a good warranty should never exceed 20% of the purchase price for 3 year coverage, nor 25% for 4 years of coverage. Ideally, you will shoot for 15% or less of the purchase price – otherwise it may not be worth your money to cover the item with insurance. This can be mitigated by aggravating lifestyle factors (particularly children or absentminded friends or partners you plan to loan the item to) for which a warranty may become absolutely necessary.Finally, is the warranty extended beyond the manufacturer's warranty, or counted concurrently (against your best interests)?One way that a lot of electronics retailers manage to make the warranty process a little more confusing is by rolling their own in-store warranties into the typical 1-year manufacturer's warranty – meaning that if you purchase an in-store 2-year warranty, you are only covered for two years total, and the retailer is only offering insurance, really, for the second year. It is important to note that not all retailers engage in this practice and do indeed honour the warranty properly, so be sure to ask the following question to any electronics salesman:“Does your two year (or three year, or four year) warranty begin at the time of sale, or does it begin at the end of the manufacturer's warranty?”Asking this question as a point of clarification can help you make a much more informed decision; some retailers even honour the manufacturer's warranty in-store and take the care to service or replace it themselves!No matter which route you decide to go on warranties, replacements, or product protection plans – be sure to consider these three primary points and to ask the golden question. Afterwards, you'll at least have all of the knowledge you need to make the best decision as a consumer and as the proud new owner of an iPad 2 or stunning SLR camera.

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