Before you hand over more money, take a closer look at what you're really getting with an extended warranty. Because in many cases, the Australian Consumer Law may already cover you.
Scored a bargain on a new TV, washing machine or fridge lately? But with the purchase often comes the question, "would you like to add an extended warranty?"
It might sound like a smart move for extra peace of mind in case something goes wrong. But before you hand over more money, it's worth taking a closer look at what you're really getting. Because in many cases, the Australian Consumer Law (ACL) may already cover you.
The ACL entitles you to have a faulty product repaired or replaced, or you can even get a refund or compensation (depending on whether the fault is a 'major' or 'minor' failure). You have these ACL entitlements, regardless of any extended warranty, and even if the manufacturer's warranty has expired. Be wary of any retailer that tells you otherwise.
Effectively, an extended warranty could mean you're paying for cover you're already getting.
So, before you sign up and pay up for an extended warranty, understand what you're buying.
Ask the salesperson to explain the actual benefits beyond your automatic, and free, ACL rights to a refund, product replacement, or repair. It is illegal for a retailer to mislead you into buying an extended warranty for rights you already have under the ACL.
Ask if call-out fees are extra under the extended warranty. Are labour and installation costs extra? Are you limited to the repairer you can use if something goes wrong with your item? Compare the cost of the warranty against the cost of your item. Remember that you already have rights under Australia's consumer laws, whether or not you buy an extended warranty.
Always check the rules, as some claims during the manufacturer's warranty could cancel the extended warranty that you paid extra for.
Stay alert to high pressure sales tactics sometimes used to convince to you to pay extra for an extended warranty and take note that retailers may also rebrand them as "product care".
An extended warranty might offer you extra peace of mind but it might not always deliver the coverage and protection you're expecting. And if you feel you're being pressured to purchase an extended warranty, you can contact Consumer Protection on 1300 30 40 54 to report the incident.
