Many shops try to scare customers into buying costly warranties for all electrical and white goods - most are a complete waste of money.
Yet if you want peace of mind, there are tricks to get free cover or multiple-item policies for as little as £10 per month. This step-by-step guide will help you decide whether to get a warranty (or an extended one if you've already got one covering an initial period), the cheapest deals if you do, and how to maximise protection without one.
Best buy warranties
The five need-to-knows
Before you jump in at the deep end and sign up for a warranty (or an extended), consider these need-to-knows.
Warranties sold in shops are often massively over-priced
Many shops will try to flog a warranty on virtually everything - even if the goods only cost a few quid.
Sometimes the warranties cost almost as much as buying a new product. In which case, it's better to take the risk, save the money, and buy a new one if your product breaks.
But if you do want an extended warranty, you can buy an insurance product which covers multiple products, or use a handy comparison tool which searches for the cheapest option. With the comparison site the warranty and the item don't necessarily have to be purchased from the same shop, giving you time to find the best deal.
Free extra year's warranty available with packaged account
An extended warranty is provided as standard if you have the Nationwide FlexPlus account as part of its £10/mth package of extras. It gives an extra year's cover after the manufacturer's guarantee expires.
As most manufacturers automatically include a year's guarantee, that means you can get two years for no cost.
The account also includes worldwide travel insurance, mobile phone insurance and breakdown cover all included within the £10/mth package. See the top free warranty packaged account section.
You have consumer rights without warranties
Under UK consumer law, goods are faulty if they're not of satisfactory quality or fit to do the job intended.
If you've faulty goods, take them back within six months and the onus is on the shop to prove they WEREN'T faulty when you bought them - only after that must you prove they were. Yet all goods must also last a 'reasonable time' - and this can be a long time for some expensive puchases. Full info below on consumer rights.
Your home insurance might cover you
Some home insurance policies will cover electrical items and white goods from theft and damage, though breakdown is less likely.
'All-risks' cover usually includes items taken outside the home too. See full details below of what you should check on your home insurance policy.
You can use warranties as a haggling chip
Sales staff often have targets on the number of warranties they must sell on a weekly, monthly or quarterly basis.
Reaching the target is often crucial to them; therefore it gives consumers a real bargaining tool to haggle down the cost of products.
The best bit is you're free to change your mind within 45 days under The Supply of Extended Warranties on Domestic Electrical Goods Order 2005 regulations. So buy the item at the knocked-down price - then cancel the policy for a full refund.
What are warranties?
A warranty is an insurance policy that lasts one to five years after you've bought an appliance, which covers you against the cost of repairs and replacements.
While the concept is good, the problem is they can cost as much as the product itself and account for a large proportion of retailers' profits and salespeoples' commission.
Worse still, some warranties used to advertise rights that were already yours by law; though the Consumer Protection from Unfair Trading Regulations 2008 now prohibit this.
What do they cover?
Warranties usually cover your appliance for mechanical or electrical failure, not accidental damage. You should get a repair including parts and labour or, if it can't be repaired, a replacement (though you may have to pay towards this).
It won't pay out for theft, or damage caused by sun, sea water or other natural elements. Stand-alone warranties won't pay out if you're still covered by a manfacturer's guarantee so there's little point in having both.
Different warranty types
Retailers pushing expensive warranties have dragged the product's name through the mud.
Worse, in recent years some have changed from being insurance policies to service agreements and the Financial Conduct Authority doesn't regulate these providers in the same way. More on protection below.
Yet they're not the only ones offering warranties, there are others out there that may be far cheaper. There are three main different ways you can cover products:
Most manufacturers include a one-year guarantee with their product, yet it's always worth checking in the box to see if they offer an extended warranty service.
This simply extends the one-year manufacturer's guarantee for less than the cost of a standalone policy, though it often only covers manufacturing defects. Also be aware you don't have to buy an extended warranty at the time of purchasing the goods.
Direct insurance for products
Effectively you buy an insurance policy from the manufacturer that is often cheper than retailer versions and tend to be more tailored to the product.
So if your washing machine manufacturer includes a free five-year, parts-only warranty, ask the insurance company for a warranty excluding parts, cutting your premium. You can usually buy these at any time.
These specialist insurance policies cover a number of appliances in one. They're often based on monthly premiums and can be better value than single policies. Prices depend on the appliances you want covered and their age, though be aware of maximum claim caps.
Do you need a warranty?
Is there a manufacturer's guarantee?
Most appliances come with a 12-month manufacturer's guarantee. Problems within that time will get you a repair or replacement but it's unlikely to cover you for accidental damage. Make sure you register your appliance or you risk invalidating the guarantee.
If you're wondering about the difference between a guarantee and warranty...
- A guarantee... is usually a free promise by the manufacturer or retailer to fix or replace the problem.
- A warranty... is a similar promise, but in this case it's paid-for by an insurance policy.
You have strong statutory rights anyway
When you buy anything, you will be protected by the Sale of Goods Act 1979. It says goods should be of satisfactory quality, fit to do the job intended and last a reasonable length of time.
Where goods are faulty, take them back within six months and this law means the shop has to prove they WERE NOT faulty when you bought them.
Even after that you still have strong rights for six years, but from then on you must prove the goods WERE faulty when you bought them. So at the very worst, if you buy, take it home and it doesn't work, take it back and you are entitled to a full repair, replacement or at least a percentage towards the cost of a replacement..
What is a 'reasonable' length of time?
The law also states things should last a reasonable length of time. This is a deliberately vague description, where the answer depends on common sense judgement...
Most would say it's reasonable for a £1,000 plasma TV to last 18 months, but not for a 50p plastic torch.
In a way this means if legitimate wear and tear breaks the product, the likelihood is you have no claim. Yet if it was an unreasonable fault, you do; however the burden of proof here is on the consumer...
The problem with your rights, especially with goods you believe should last longer, is stores often won't agree. If that happens your only recourse is to take them to court - see the full Consumer Rights guide for more on this, and the Sale of Goods Act.
Does your home insurance cover it?
Some home insurance policies will cover electrical items and white goods from theft and damage, though breakdown is less likely. Plus if you have 'all-risks' cover it may cover portable items taken outside the home too. So it's worth quickly checking:
If it provides a replacement. If so, how long will it take?
If you'll get current or new value. If you get cash for the item, check whether it'll pay to buy a new one, or just enough for its current value
If you'll need to pay an excess on the reclaim. You may have opted for a hefty home insurance excess to make the policy cheaper (excesses on warranties are usually small). If the excess is more than the item is worth, it will be pointless to claim.
If you'll have to pay call-out fees. If you need a repair, it's possible you may have to cover call-out or delivery/collection fees yourself.
If it includes portable items? Some home insurers will exclude items that can be taken out of the home, check first.
Home insurance can be an extremely cheap solution. In fact, using the Cheap Home Insurance system, some MoneySavers have actually been paid to take policies out.
Does the shop give a free warranty?
A number of retailers offer their own warranties for free. For example, John Lewis offers a five year guarantee on all TVs. It now also offers a minimum two-year guarantee on all electrical products at no extra cost.
Yet these retailers can be more expensive for the products, so you have to balance the two out. In the case of John Lewis, as it has a price match promise, if you find it elsewhere cheaper, use the price match and get the warranty added free.
Free Section 75 protection on credit cards
Credit cards can help protect your goods. Buy something costing over £100 on a credit card and you get Section 75 legal protection; this doesn't happen with cash, cheque or debit card transactions.
So buy anything costing over £100, and providing some of it's paid on the card, the card company's equally liable with the retailer if things go wrong.
Always set up a direct debit to repay the balance in full each month, else you'll have to pay interest on your purchases.
Could you repair it yourself?
If the problem is a simple one, getting it repaired yourself may be a cheaper option if you're nifty with a tool set or it's a low tech appliance.
Get parts or spares which you can then use to fix the item yourself. Even calling a repairman might be cheaper than the cost of a warranty over a few years.
The stats: Is it worth getting a warranty?
|Appliance||Average cost (1)||% that haven't required repair after six years (2)||Average cost of common repair (3)||Cost of the cheapest 12 mth warranty (4)|
|Upright vacuum||£239||79%||£3-£10 (new belt)||(only up to £200) £19.02|
|Cylinder vacuum||£180||91%||£5-£20 (new filter/dustbag)||(only up to £200) £19.02|
|Dishwasher||£412||86%||£20-£50 (Internal blockage)||£45.83|
|Washing machine||£659||81%||£25- £65 (New hose and valve)||£88.05|
|Washer dryer||£727||71%||£73 (element failure)||£88.05|
|Tumble dryer||£493||89%||£40-£100 (New heater)||£45.83|
|(1) Based on the average of Which?'s best buys. (2) From Which?'s reliability survey. (3) From Which?'s repair or replace report. (4) Based on appliance four years old. June 2006-January 2010.|
Can you 'self-insure' it?
Self insuring means instead of paying for an insurance policy, you put the money aside each month into a savings account.
This way if you lose or damage the item you've got cash to pay towards a replacement, and if you don't, the cash and the interest are yours rather than the warranty company's.
The risk is you'll need the cash before you've saved up enough.
Best buys: The cheapest warranties
If you want a warranty, free ones via credit card perks are the cheapest way to get them.
A poor second is via specialist standalone providers. Here, the cheapest depends on what the appliance is, how much it's worth and how old it is. Usually, standalone warranties won't cover goods over eight years old.
It's always important to check the cover is appropriate for you first. And remember most policies won't pay out within the first 30 days.
Best for: Multiple products
One of the biggest providers of extended warranties
Warranty Direct is one of the biggest providers of this type, and is often cheapest for multiple appliance warranties, especially if you've fairly high-value products to cover.
The Warranty Direct plan costs from £12.75/month for three appliances, such as your cooker, washing machine and TV and offers cover against mechanical, electrical or electronic breakdown. Accidental damage is not included.
The plan covers all items up to £2,000, but there's also an annual claim cap of £2,000. So if you claim once for a TV worth £2,000, you won't be able to claim again that year.
Offers three different levels of cover
Surewise.com* offers three levels of cover. Bronze is the lowest and costs £9.99/month. It covers up to £1,000 worth of products. Silver is £15.99/month for up to £3,000 of items, and Gold is £19.99/month for up to £5,000.
There's no limit on the number of items you can cover under one policy, so you can cover anything from your cooker, washing machine to your TV all at the same time, though you're limited by an annual claim cap (how much that is depends on your level of cover).
Best for: Single products
No single warranties are that cheap. If you do want one, check out the following...
Offers single policy cover
Surewise.com* also offers cover for single products for £5.99/month, with a maximum item value of £3,000. It has an excess of £30 (or £50 if the product is more than five years old), but could still come out on top for more expensive items.
Compare Extended Warranties
Comparison tool compares high street warranties
Compare Extended Warranties is simple price comparison site where you can compare the price of warranties across a range of household items. It's run by four providers - Currys PC World, Argos, Domestic & General, Tesco - under an agreement with the Office of Fair Trading.
You don't need to buy the product and the warranty from the same place, though some won't cover products bought elsewhere. Currys PC World don't allow you to buy the warranty separately, but Domestic & General does.
This comparison site often comes out best for single products, and for multiple products with low values, so check for the items you want to cover and see whether you can beat the multiple item policies above.
Be very careful when using this site as it can be confusing in the way it lists policies. For some policies listed you pay monthly, but others are priced for three or five years. Check that the price - and the cover - are suitable for your needs.
You can't click through from the comparison site to the provider, so you'll have to visit the warranty provider separately. Usually, you'll then need to call or visit a store as only a couple of providers allow you to buy online.
Includes a warranty in the price
John Lewis has been left off the comparison site, but offers a good alternative. It typically offers a five-year guarantee on TVs, three years on its own-brand appliances, and now a minimum of two years on all other electrical goods at no extra cost. It also price matches, so if you find the product cheaper elsewhere, it'll match it.
Best for: Cover via a packaged bank account
Free 12 month extended warranty
The Nationwide FlexPlus* account offers extended warranty as part of its £10/month package of extras. It gives an extra year's cover after the manufacturer's guarantee expires.
There's no limit on the number of appliances and it covers up to £2,000 per claim with a maximum claim of up to £10,000 per 12-month period. However, it doesn't cover items purchased outside the UK, or 12 months before opening the account.
The account also includes worldwide travel insurance, mobile phone insurance and breakdown cover.
The account's probably not worth it for the warranties alone, but if you'll use all or most of the other benefits, it's worth a look. See Packaged Bank Accounts for full details.
Always check the insurance policy for exclusions before relying on it.
- What does it cover? No limit on the number of appliances for one year's extended warranty
- Limts: maximum of £2,000 per claim/total of £10,000 over a 12-month period. Appliances must cost between £50 and £2,000
- Accidental damage? Yes
- Theft? Yes
- What does it NOT cover? Appliances not purchased by you on a credit or debit card in your name. Purchases from internet auction sites. Second hand or reconditioned appliances
The warranties warning checklist
The small print varies between policies, so make sure you check the following before parting with any cash.
Is your policy protected if the provider goes bust?
When it comes to protection there are two types of policy; service agreements and insurance policies.
Insurance policies are fairly well protected, service agreements have almost no protection if something goes wrong.
Service agreements offer less protection
Service agreements - usually the ones sold at the point of sale, such as Argos's Replacement Product Care - aren't regulated by the FCA. If the company goes under, you have almost no protection.
Insurance policies are Government-backed
Insurance policies from providers which are regulated by the FCA are covered by the Government-backed FSCS scheme.
There are two main ways in which it protects you:
If you need to claim from a bust insurer
The FSCS's main objective is to 'maintain continuity'. This means if your insurer goes bust, it will try to find another provider to take over your policy, or issue a substitute policy. However, if you have any ongoing claims, or need to make a claim before a new insurer is found, the FSCS should ensure these are covered.
If it goes bust and you paid upfront
If you've paid for cover for a year, but the company goes bust after a month or two, then you would lose out.
To protect against that, if the FSCS can't transfer your policy to another provider, you'll be given a period of time to take out alternative insurance, and any money you've already paid will be refunded as compensation via the FSCS. To help explain, here's a quick example...
You paid for a year-long policy in January and the insurer went bust in September. If the FSCS can't get the policy transferred elsewhere, then you will receive four months' compensation of the original cost.
The limits of the compensation depend on whether the policy is compulsory or not. Compensation for policies you are required by law to have, such as third party car insurance, is unlimited, so you get 100% of the premium back. Non-compulsory policies (including warranties, home, travel, life and PPI) cover 90% of the money paid.
Is accidental damage or theft included?
Accidental damage is sometimes covered, a big benefit over manufacturers' guarantees. However while theft usually isn't, your house insurance might cover it, so check you're not paying twice for the same cover.
When does the policy start?
Some extended warranties start after your manufacturer's policy ends but most will run from when you buy it (which often needs to be within 30 days of purchase) so a five year policy is only really covering you for an extra four years after the manufacturer's guarantee ends.
Do you have to pay for extras?
While the policy may cover the cost of parts it might not pay for delivery of these parts. Some providers may not cough up for call-out fees, particularly if it needs to be done outside normal working hours.
You may also have to pay for the repair upfront, then claim back the cash. These types of policy can be cheap but if you're likely to forget, don't bother.
Is it 'new for old' replacement for unrepairable goods?
Most policies try to repair the appliance up to three times before a replacement is even considered. When that happens, check whether you'll get the cost of buying a new appliance or the price you paid for it initially.
Can you extend the warranty beyond its original life?
Some providers may offer you a renewal at the same price you paid originally, however others will offer a new quote, take into account how old the appliance is.
Do you get full cover for the entire duration of the policy?
Sneakily, some policies will only cover the full replacement costs in the first year of purchase when you're still covered by the manufacturer's guarantee. After this, you may only get a proportion of the replacement costs in a descending ratio. For example, in the third year of purchase, you may only get 30% towards replacement costs.
Is there an annual claim limit on multiple warranties?
Many of the specialist extended warranty providers offer one warranty for multiple items. This is usually cheaper but beware of annual claim limits. Often you can only claim £2,000 in a year, so if you're insuring an expensive item, this allowance can be wiped out in in one hit.
Is it a cashback policy? If so, avoid like the plague
Cashback warranties give a full refund if you don't use the policy after a certain number of years. However they'll make you jump through hoops and it's notoriously difficult to actually get your money.
There's usually a very tight timescale within which you claim the cash. If you have one, use our Free Tart Alert to send yourself an automatic reminder six weeks before you need to send in the forms.
What's the cancellation policy?
With shop-bought policies, by law you can get a refund, provided you haven't claimed, up to 45 days after you purchased it. With standalone policies cancellation terms differ, though you can usually cancel with one month's notice provided you haven't claimed - otherwise you're entitled to a refund within 14 days under the Consumer Contracts Regulations.
Can you extend the warranty beyond its original life?
Some providers may offer you a renewal at the same price you paid originally, however others will requote and take into account how old the appliance is.
What if the warranty doesn't pay up?
Warranties are legally binding - so if the retailer or provider doesn't do what it should, you have legal recourse. Hopefully it will never get to this, but it's worth being aware of your rights if there's a problem.
Step 1: Complain to the policy provider
Escalate the complaint as far as you can with the policy provider. Include all the details of previous communications. Quote the clause in your warranty that you want to claim under to help your case.
Step 2: FCA-regulated? Complain to the free Ombudsman
Specialist providers of warranties are usually regulated by the Financial Conduct Authority. So if you encounter any problems claiming, you can go to the Financial Ombudsman, the independent arbiter of financial disputes.
The most important thing to remember is that with any FCA-regulated company you have a right to be "treated fairly" - which of course is a very wide statement. So if you think your complaint hasn't been treated fairly, you can refer it to the free Financial Ombudsman.
Hopefully, just threatening the policy provider with this should be enough in the first place. If not, then fill in the Ombudsman's form and submit your complaint. Read the Your Financial Rights guide for full details of how to do it.
Policies you get direct from manufacturers or retailers (these tend to be free) are usually service agreements meaning they're not regulated by the Financial Conduct Authority. In which case you'll have to skip to step 3.
Step 3: Consider the small claims court
As a very last resort, you could consider going to the small claims court. There's a fee from £25 depending on how much you're claiming, but it's refunded with successful claims. For full info, see the Small Claims Court guide.
How to complain about your insurance provider
The insurance industry doesn't have the best customer service reputation and while a provider may be good for some, it can be hell for others. Common problems include claims either not being paid out on time or at all, unfair charges, or exclusions being hidden in the small print. Itís always worth trying to call your provider first, but if not thenÖ