Just say no to an extended warranty

You’ve spent a morning browsing the washing machines in a major electrical store. After an hour of making comparisons and interrogating the young salesman, you’re finally at the till.

Then comes the killer question: “Do you want an extended warranty with that?” In a moment of insecurity, you think you better had, and succumb.

The scene is played out thousands of times a week across the UK, making the extended warranty business worth £750  million a year.

But are these guarantees worth it? Probably not. In fact, the industry is under investigation by the Office of Fair Trading which is looking into its value-for-money claims.

Extended warranties are policies that insure against the cost of repairs or replacement for a set period of time beyond the manufacturer’s own guarantee. Current rules on their sale state that retailers have to tell customers that an extended warranty is optional, that they can buy the cover up to 30 days after purchase, and there’s a 45-day cooling-off period to change your mind.

Remember, too, that thanks to the EU Directive 1999/44/EU and Sales of Goods Act, a minimum two-year guarantee should apply to the sale of all consumer goods bought. Any faulty goods can be returned within six months to put the onus on the shop to prove they were not of satisfactory quality. Beyond that, they need to last a ‘reasonable’ amount of time, which will depend on their value and whether they were used for the job intended. It’s worth taking this up with shops.

You can also get cover elsewhere. Some credit cards include a year or more of extra warranty when white goods are bought on the plastic; electrical items may also be covered by your home insurance, so check whether you can make a claim that way before agreeing to the grinning salesman.