Notes On Consumer Affairs
I would like to start this article by saying that I am happy to report that this publication is my 200th article on Consumer Affairs and Protection. I have enjoyed keeping the community informed of the latest consumer issues, scams, and protections through these articles over the past several years and I look forward to writing many more and continuing to serve you and the people of District 23 in the New York State Assembly.
Most of us have been there: we go to sign the final paperwork for that new car or get to the checkout line with a new TV, and we are asked if we would like to purchase an extended service plan or warranty. These plans provide coverage beyond any manufacturer’s warranty should the item being purchased need repairs. Before you decide to purchase one of these plans, you should consider several things.
First, find out exactly what the plan covers, as many contain limitations that can make it difficult to exercise plan benefits. Many plans will cover what they consider “reasonable” parts and labor costs, but they do not offer specifics, leaving the coverage terms open to interpretation later. Extended service plans for automobiles typically do not cover repairs that the industry considers to be the result of normal wear and tear; this often includes repairs involving tires, brake pads, rotors, shock absorbers, belts, hoses, etc. In addition, some auto plans will not pay for repairs if a covered part failed because a non-covered part was defective; for example, if the engine, which is normally covered, overheats and needs repairs because the fan belt, which is not covered, broke, some extended warranties will not cover the repairs to the engine. Many fabric warranties only cover single incidents and give you a limited amount of time to submit a claim, so a claim submitted for multiple stains incurred over a long time could be denied. Be sure to read over the contract carefully and if you have any questions about what is covered, ask.
Second, you need to determine if the extended service plan is worth the cost. The companies that offer these plans know what parts of your item are most likely to break during the coverage period, and many low-cost plans do not cover them. As a result, consumers could spend more for the plan than the actual cost of repairs. In addition, many items come with a manufacturer’s warranty. When you purchase an extended service plan, coverage begins at the point of sale.
If you purchase an eight-year extended warranty at the point of sale for an item that is still covered by a three-year manufacturer’s warranty, both warranties will run concurrently, meaning that you could be unnecessarily duplicating your coverage and only getting five years worth out of your eight-year warranty. In this instance, you may want to consider shopping for an extended service plan a few months before the manufacturer’s warranty expires. As with any consumer product or service, always comparison shop before deciding on a particular plan.
Third, you should be aware of who is guaranteeing an extended warranty. Often-times, the retailer acts as a salesperson and the warranty is actually provided by another company. If the warranty company goes out of business, the retailer is not obligated to honor the warranty agreement. Before purchasing a warranty, you should check the warranty company’s rating with the Better Business Bureau by going to www.bbb.org or calling (212) 533-6200.
You can also contact the state At-torney General’s office at www.oag.state. ny.us or 1-800-771-7755 and the state Consumer Protection Board at www. nysconsumer.gov or 1-800-NYS-1220 to see if they have had any complaints about the company. Finally, if you decide to purchase an extended service plan or warranty, keep a written copy of your contract and the coverage terms.
If the retailer or warranty company states that something is covered, confirm by asking for it in writing.
Keep detailed records of any conversations you have with the warranty company.
In addition, maintain detailed maintenance records, including receipts, for any repair work performed, even if the work was not covered by the plan or warranty, as you may need to refer to them if any questions are raised later.