They just don’t make things like they used to. My Goldstar window A/C in the bedroom is working flawlessly after 20 years. But I have had bad luck with dehumidifiers having gone through several of them. They seem to only last 2 or 3 years and they were name brands (one was a GE). So for the latest one I bought at Menard’s I went with their 24 month extended coverage. Naturally it is fine after 3 years.
I had a Midea 5000 BTU window A/C from Walmart for my garage. Despite being used very sparingly it died quite suddenly after 2 years. One day it worked, the next - nada. And I left it mounted all the time, no jostling it in and out each summer. I had purchased the 24 month coverage and I must say it was a pleasure to deal with.
Surprisingly, Allstate provides Walmart’s appliance coverage, not some un-heard-of warranty company. I just went online and filled in the details. They immediately accepted the claim and I had a check in 3 days. I could have gotten a Walmart credit immediately but I did not want to buy another Midea.
I bought a Denaili Aire from Menard’s and the woman at the register only offered a 1 year extended warranty which I passed on. But the unit came with a nice full color brochure for extended coverage and 36 months is only $27. And that is added on to the 90 day factory replacement coverage. The unit I bought is the “value” model with only manual controls which is all I need for occasional use.
I’m more-or-less pleased with buying appliances (small to large) from Costco, where they often/generally double or even triple the manufacturer’s defects warranty.
I haven’t had to use it yet (the dishwasher and TV I’ve bought being the only ones I’ve done in the last few years), but it does factor into deciding what/where to buy.
Speaking from experience, Consumer Reports is wrong, or at least out of date. Even the service call for the tech to come out and tell you your dishwasher is forked can make the contract worthwhile. And I, for one, do not want to junk an otherwise working appliance simply because a $20 replaceable part has gone bad.
As I remember, Consumer Reports suggested just banking the money you’d spend on the extended warranties for all of the various appliances and then use that money to cover any unexpected expense. (Even if your dishwasher breaks down, it’s unlikely to do so at the same time as the clothes dryer and the air conditioner and the refrigerator.)
But- which part? And how much is the labor? Usually , around here about $100-$150/hour. So, you have a $20 part and $150 labor, how much is that thing worth?
Over here, and I suspect in most places, it is normal for sales assistants to sell extended warranties on appliances. I assume that there is a commission. involved.
In some cases the cost of the warranty can exceed the cost of a replacement, which is bonkers.
I do confess that when I bought my current car, some ten years ago, I paid for an extended warranty on the grounds that it has a lot of complicated systems and the deal looked reasonable. In the event, they had to replace some brake parts after a year, which would have been quite expensive.
It depends on the problem, and on the particular “people” involved. Some years ago my dishwasher developed a problem with the door latch due to an internal crack which made it difficult to open. The latch is also electrically linked to the power circuit so that the washer shuts off when the door is opened, so it’s not just a purely mechanical gadget.
Anyway, I found the correct part online and installed it myself (I don’t think it was more than about $20) and the dishwasher has been fine ever since.
Extended warranties make sense only when you have reason to believe that you may have an early failure. One of the only times I took out an extended warranty was when I bought my son the first generation X-Box, because I’d heard that early versions had been subject to a particular type of failure characterized by a specific irrecoverable error message. Sure enough, we got that message a few months later.
Dealing with Best Buy was somewhat unpleasant as they claimed to have sent the unit to their own technicians for repair. After about a week or two I eventually did a male-pup Karen and demanded to speak to the manager. In the end, we got a brand new X-Box. But beware that extended warranties may have exclusions and may not always give you the protection you think you’re getting.
Insurance is something you should expect to lose money on.
If you’re being purely economically rational, the onlyrealthings you should insure, and this includes paid-for houses and cars, are things you can’t afford to replace out of pocket no-notice.
For most folks, that includes their owned residence and any nicer not runout cars. Insuring your TV or washer or whatever will be a money loser. At least across all your years and all your appliances. But if you can’t afford to replace it no-notice, then you ought to do the long term economically inefficient, but cash flow smart, thing and insure it.
The next step of course is that many of the consumer goods “warrantees” or service contracts sold at the time of goods purchase are rip-off priced. Which means either try to shop for 3rd party independent coverage, of move your threshold from “It’d hurt hard if this thing quit on me” to “I’d be utterly screwed if this thing quit on me”.
The length of the extended warranty on offer, tells you exactly how long, with certainty, (because their own research has proven so in tests), this item will function without issue.
It’s a bad bet for you, and close to a sure thing, for them!
Sometimes extended warranties do pay off, but it’s rare.
Our new (-ish) refrigerator quit working the same day the warranty folks called to try and sell us a policy. My wife answered the phone while I was moving food out of the failed fridge. When finished with all the signup info, she asked for the claims number, called it, and they sent someone to replace the compressor.
We normally don’t buy them, but this time is was much less than the repairs we were facing.
Soon after replacing all four tires at Discount Tire, we went on vacation and had a flat (ran over a knife, of all things). Limped off the interstate, swapped with spare, and headed for a nearby Discount Tire to replace the failed one. After presenting ourselves at the counter, they said we were still within the window to buy their “everything” warranty coverage on the original set. It was cheaper to buy the coverage than a new tire, so we paid for it, and they replaced the failed tire under our minutes-old new warranty. So now we have our very first “tire insurance”. It supposedly covers almost most all road damage, and includes lifetime free balancing. (For however they define “lifetime”)
Oddly enough, Sears still has a home appliance warranty program. I used it back when we owned our home in Portland. You’re not locked into any specific length of time (or weren’t back then), so it was easy to sign up and then cancel after the work was done. Financially, it paid off. The cost of repairs to our washer alone far exceeded the cost of the insurance. We just used a laundromat while waiting for the one month wait period to expire until the insurance kicked in. The module that was replaced in the washer would have been over $400. They may have changed their policies to prevent people from doing that sort of thing now.
for modern appliances, that is usually not the case. Common sources of breakdown are electronic control modules, which can be a couple hundred dollars for the part and the same or more for labor. At that point, it probably makes more sense to just get a new appliance. That’s not to say that is always the case though. My advice is to try to gain a basic proficiency at identifying common and easy to fix issues with appliances. My dryer stopped working recently and I diagnosed and replaced a bad thermal fuse, a $5 part. But be prepared for sticker shock if more expensive parts on these ever more complicated appliances go bad.
As someone with a demonstrated ability to break burned out light bulbs when unscrewing them from the socket and a demonstrated inability to drive a screw straight into its hole without stripping threads or creating a larger, oval-shaped hole, my wife and I agreed years ago that it was worth hiring someone who knows how to do with their hands what I only know in my head.
I don’t buy extended warrantioes on electronics like TV’s, because they’re obsolescent in six months. I do buy warranties for appliances like refriegerators, dishwashers, etc., because I expenct to use them for years and I don’t want to replace them simply because a circuit board or a touch panel decides to fail after the manufacturer’s warranty expires.
Financially, most people would come out ahead if they paid for their own repairs/replacement than if they paid for the warranty. However, the peace of mind and ease of repair may be of enough value that the extra cost of the warranty is worth it to them. But from a strictly cost perspective, most everyone would be better off self insuring by putting their warranty payments in the bank and paying out of pocket for repairs/replacement.
From a financial perspective, paying for a warranty is somewhat like playing a slot machine. If you only look at your wins, the slot machine seems like a great deal. Put in $100, get $100+ back. But if you added up the wins/losses of all your slot plays, you’d likely see that you lose money overall in the long run. For every win you have, you have many losses. It’s like that with appliance warranties, for every one you use, there will be several that you don’t.
We pretty much never get extended warrantees - my husband used to sell appliances and got a huge commission on what they called the “cheese”. He would sometimes buy it if he got a super low price so a friend could make the commission. Sure, someone will be better off buying one - but my husband got a large commission because they were almost pure profit.They don’t sell 5 year extended warranties because they expect the appliance to break within 5 years - they expect it to last at least 5 years.
Believe it or not, I just recently had both my washer and dryer stop working within a day or two of each other. I was able to figure out the problem with the dryer, and ordered the $20 part. I was pretty sure I knew what the washer problem was and when we called the repair service, he asked what the problem was. It turned out that I was right, and the repairman told me to just get a new one because the parts alone would be almost $500. An extended warranty wouldn’t have done any good since it was about 10 years old.