So, you've selected the gadgets to give your loved ones, and you're at the checkout line. Suddenly you're asked if you want an extended warranty or protection plan for a modest sum, and the line is piling up behind you. Do you opt for the foot-long receipt with terms and conditions that you'll have to keep in a secure place?
Even if such a plan is right for you, just say no.
Many plans can be started within 30 days of buying your phone, TV, camera or other gadget. Some online outfits will cover gadgets starting a year or more after purchase. Waiting will let you shop around to make sure you get the right coverage at a reasonable price. In many cases, you might conclude you don't even need it.
Here's a quick thumbnail of what's at stake:
Most products already come with a warranty covering factory defects and other problems that are not of your own doing. With an extended warranty, you pay a service provider, typically an outside company, to cover problems that arise after the manufacturer's warranty period ends. Such extended warranty plans won't cover accidents and other problems if it's your fault, though. Typically, they cover what manufacturers' warranties cover, but do so for several months or a few years longer.
For accidents, you'll need a protection plan. These plans can extend the warranty, but also cover accidental drops, spills and dunks, which have become more frequent thanks to the rising number of mobile devices these days. They often don't cover loss and theft. For that, you'll need insurance, which is offered by wireless carriers if you are getting a mobile device.
DO YOU REALLY NEED IT?
Retailers will push such plans because it's another revenue stream for them.
Consumer Reports magazine doesn't believe buyers need them.
It says the "vast majority" of repairs that qualify for warranty coverage occur within the standard warranty period. It also says the cost of the extra coverage -- a median $73 for items purchased in-store and $64 for online purchases -- is too high given the very low risk something will happen outside that period. Also, credit card companies will often extend the warranty for free.
Senior Editor Jim Willcox says you should even forego extra warranty coverage on lesser-known TV makers.
"Before you add on the cost of an extended warranty, why not just buy a better TV from a major brand?" he says. (continued...)
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