Should You Buy An Extended Warranty For Computer?

by on August 7, 2008 · 18 comments· LAST UPDATED August 7, 2008

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Most computer manufacturer try to sell you extended warranty or a service contract. These warranty covers two years past the manufacturer's one year warranty. Most sales employees or OEM (manufacturers) make so much commission from selling extended warranties. This is nothing but rip-offs, IMHO.

If I build a computer for myself by purchasing parts I get following warranties:
=> Intel CPU and motherboard - 3 years warranty
=> Seagate hard disk - 5 years warranty
=> Nvidia chipset display card - 3 years warranty
=> Dell / Samsung 27" TFT Monitor - 3 years warranty
=> DVD / CD Write combo / keyboard / mouse - 90 days warrant (but works for years w/o a problem).

Most OEMs will not pass these warranties to end user. I never buy an extended warranty. I own 2 desktops, 2 laptops (Dell and Sony) and total 5 enterprise grade rack mount servers for my personal use. All are build using parts except laptops. Let me tell you simple truth:

It is cheaper to pay for repairs as and when they happen rather than buy a warranty. Extended warranties are not a good investment, period.

Today you don't require tools to build PC. All you need is screwdriver to fix a computer. I only open my computer when I need upgrade or replacement of hard disk etc. If you use Windows, you simply need to use updated version of anti-virus / anti-spyware cleanups program.

Finally, if you need an extended warranty make sure you get answers to the following questions:

  1. Is the warranty transferable?
  2. Can repairs be performed at any repair shop located anywhere in the world?
  3. Find out what's covered and what's not covered.
  4. Make sure it is not reimbursement based warranty. For example, some computer repair shop require that you pay the bill and then send receipt to OEM and wait for reimbursement.
  5. Always read the fine print. For example, If you drop or broke something there is no warranty.
  6. Use the Internet to dig out information about product and services. Search mailing lists and forum for product. See the current user satisfaction level.

Please add your opinion about extended warranties in the comments.

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{ 18 comments… read them below or add one }

1 Davide August 7, 2008 at 7:34 pm

I think that it’s, for end-user-hardware, useful only for laptop.
On a laptop i cannot open it or i cannot bring it to a local computer store, i must send it to the original manufacture (hp,dell ecc..) and spend a lot of money.

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2 dj August 7, 2008 at 7:47 pm

Absolutely agree. (1) If the store is reputable, they will assist. Otherwise do business elsewhere. (2) If the equipment is that poorly made, don’t want it in the first place. Get something else and cut your losses. (3) We bought very expensive Sony Vaio’s (we had hoped expensive equated to quality), and had really bad experiences with service and ext warranty. Nothing local. Only option for almost ALL problems was to send the device halfway around the world. Anyone see a security problem with this? We brought it up, and we got the run around. If you take the drive out, for obvious security reasons, you void the warranty. We tried to work something out w/Sony, even paying for a new drive they could install. (4) In the end, today’s warranty’s are more of a way to extract more money up front. Unfortunately a lot of technology is commodified with planned obsolescence. We’ve changed our whole way of buying technology within the last 10 years.

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3 Sweta August 7, 2008 at 8:06 pm

Greedy companies; but for laptop you need to get an extended warranty. I got my dell monitor replaced in UK, it was purchased in India. Sure I had to go though a little trouble but finally they did replaced my puter screen.

Oh what an irony I see lenovo laptop ad with free 3 year warranty updated ;)

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4 Sweta August 7, 2008 at 8:07 pm

it was dell xps laptop,

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5 Serge van Ginderachter August 7, 2008 at 10:06 pm

For end-user purposes, you’re probaly right.

For the sake of supporting companies, and to be able to have a short Time-To-Recover when disaster happens, you need a good support contract, to be sure to get spare parts quickly.

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6 phreakincool August 8, 2008 at 5:10 am

I’m one of those people just lucky enough to never have had a problem with any computer I’ve purchased or built. :-) Therefore, I’ve never purchased the extended warranty on such items. Now on other consumer products, like a large screen TV, I wouldn’t hesitate. And make sure put your paperwork in a safe place, like a file cabinet or safe. Because without them, most manufacturers or stores don’t know you. *cough*BestBuy*cough*Sony*cough*

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7 Aaron Conaway August 8, 2008 at 12:14 pm

I totally agree from desktops, but, as has been said, you need it for laptops. I bought a really expensive (but rocking) Dell laptop that slowly died after the warranty went out. A quick call and a brand-new one (upgraded since they didn’t have an equivalent) was on my doorstep in 2 days. Saved me from spending another $2500.

phreakincool: I agree with keeping paperwork safe. Note, though, that a fireproof safe is not waterproof. I learned that several years ago when our apartment flooded out. :(

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8 Ken August 8, 2008 at 6:23 pm

Let me ask you, do you cache every part for every mission-critical system you have, within 4 hours reach? I do, at least, I do through Sun, Dell, IBM and HP 4 hour tech support contracts.

You have only 5 servers, so maybe you can cache enough essential parts. I have also have less-than mission-critical commodity servers bought in bulk, where the extra servers serve as my parts cache. Even there, they came with a vendor basic 3 year warranty, through which I have gotten replacement parts. I just let a few parts pile up and after a few months RMA them together.

Do you have a half-dozen users waiting by your door while you sort out a finger-pointing exercise between your M/B manufacturer and your O/S vendor?

Question 2 is baffling. All repairs happen in my own lab, either by myself for the non-critical stuff, or by the Dell/IBM/Sun/HP technician (yes I use them all) 4 hours or less after I make the call.

Your advice gets down to the old debate, if you build it yourself, you have ultimate control over your system. You are also responsible for all downtime and sorting out all inter-vendor snafu’s, not to mention a different RMA process for each vendor you are dealing with. I have 6 to deal with – IBM, Sun, HP, Dell, Seagate, and WD. How many do you? Let’s see, add in video card vendors M/B vendors, yada yada yada, I bet it’s 20 or more.

-Ken.

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9 Ken August 8, 2008 at 6:30 pm

I have one comment about your quote:

It is cheaper to pay for repairs as and when they happen rather than buy a warranty. Extended warranties are not a good investment, period.

If your time, and the time of everyone who uses your servers, is free, that might be true.

When 20 engineers sit and wait while you fix a vexing problem, and there is no 4 hour warranty to open a priority ticket on, how much does that cost? It can easily cost more than the cost of the entire server cluster.

And yes, I have had several server motherboards replaced on a four hour basis, a RAID backplane, several RAID disk drives (did it myself but special courier delivered FibreChannel drives in 2.9 hours), other stuff… while managers fiddled and festered and engineers said they wouldn’t make deadlines. In only one case did a system require a second set of parts, made the first call in the morning, first try in the afternoon, second set of parts the following morning, system up and running with less than 24 hours of downtime. In the meantime, I got other work done instead of working the phones trying to track down who had the part and who could FedEx the fastest.

-Ken

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10 nixCraft August 8, 2008 at 6:57 pm

Ken,

This post is about personal gear and as end user consumer. Most Government and corporate decisions are made by higher authorities, so I’ve no control over them. Yes, at work place we do have 4 hrs replacement warranty with all major suppliers such as Sun, Cisco etc.

I should have mentioned this in my post itself.. heh

Appreciate your post.

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11 Anjanesh August 9, 2008 at 1:32 pm

For branded PCs I would recommend extended warranty. I paid for 2 yrs extended warranty and today I had to get my SMPS & onboard speaker replaced. All this was done in 3 days via HP support and I am glad I paid for it otherwise I would have had to spend more time over the phone getting the local engineers over here.

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12 adrian oh August 9, 2008 at 2:38 pm

As far as laptops are concerned, i disagree with you on not buying additional warranty.

1) Murphy laws, if something will go wrong, it will. esp true applying to Electronics Components like computer parts, they are just too freaking fragile.

2) Most ppl buy a laptop and expect a lifespan for 2 to 3 years. But most manufacturers comes with only 1 year warranty. Extend it if possible, it’s justifiable when the warranty cost 20% or less than the total unit cost. (aka buying a $2000 laptops and paying less than $400 for 3 years warranty). Your investment will be worth while esp we want piece of mind, and we want assurance our parts will be there when our machines go haywire (which it will, just a matter of time). Bear in mind, for laptops, you cannot easily find replacement or compatible parts, most of the time only the brand manufacturers carried it. So if they stop producing the parts and running out of stocks while you are in your warranty period. voila! time for a new laptop. :)

3) Certain extended warranty services like Dell (in Malaysia, my country) offer on-site services. They come to your door steps via their appointed technician to fix your problems. And if they cannot fix it for you, they replace the whole damn thing for you. Trust me, they replace the whole unit of projector for me and they have replace the whole LCD screen for my fren laptop. (of coz, they eventually pass the cost back to their taiwanese supplier)

See the benefits? we don’t need to waste extra fuel and TIME driving to the service centre, find a parking, dump the broken machine and expect 5 working days to repair (if you are lucky).

I once bought an acer laptop, guess what, the motherboard crashed just one week after the 1 year warranty period, it cost me RM900 (~USD 280) to just replace the damn board. If i opt for extended warranty, it would save me an additional RM600 (~USD 190)while giving me additional 2 years extension on the warranty.

So buy extended warranty (when you buy laptop) and trust me, from my experience thus far, i never regret it.

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13 Imran September 11, 2008 at 10:42 pm

This is specifically relating to New Zealand, however it may also apply in other countries

=====

In New Zealand, there is a law called ” Consumer Gurantees Act “. All electronics sold in New Zealand at shops , are subject to 1 year warranty. If it doesn’t have it, you can’t sell it. On top of this, the Consumer Gurantees Act has a mention that all items sold has to last a reasonable amount of time. When people fork over $2000 on a plasma tv, they expect it to last them 5 – 10 years without issues. Even if you are only given 1 year warranty, if they stop working after 1 year, what you need to do is to take the company who sold you the item to small claims court. The fee is $25 in most places. The adjudicator will ask the manufacturer what the reasonable life expectancy of the item. No company in the world will say that the item that they have manufactured is only supposed to last 1 year.

I’ve gotten my washing machine fixed twice, and a tv replaced with this. I love New Zealand.

Imran

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14 Ash June 23, 2009 at 5:07 am

Imran: I didn’t know New Zealand is a socialist country.

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15 leila December 24, 2009 at 8:34 pm

This was very helpful thank you for taking the time to post it.

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16 ANGEL GUASCH May 25, 2010 at 2:19 am

i haved purchased warrantees all my life,,,i feel it is a good investment….of course not all things are worth and extended warrantee….it all depends how you look at things…..for example,,,i pay $140.00 per year to sears for my old refrigerator…the way i see it, is that i am actually paying $12. per month as rental for a refrigerator that will always be repaired and working with my ice-maker… if i look at the $140.,,,as an expense you will see it as an expence but if you look at it as a investment,, then that what it really means to you…..in 5 years i would have given sears $700.000, for which i could haved bought a new refrigerator,,,but remember that changing a compressor could cost $400. plus service call.. i always look at it, that i am renting for applicances that will always be fixed when they break down,,,if they dont break down,,,well, good for sears,,,if they break down i wont have to worry…..but on the long run,,, i might not make a profit or loss,,,but sure will save a lot of time,,,and time is life,,,,,like looking for another refrigerator might take you a few days to chose,,,as for me i just pick the phone and keep my refrigerator…

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17 Cameron February 4, 2011 at 2:11 am

I used to never buy warranties. But, once I became a tech at a major pc retailer, I really saw the value in them. Lets face it, computers are not made the way used to be. I probably get 2 or 3 hard drive failures a month on systems that are less than 2 or 3 years old. Not to mention motherboards and memory. These things are cheaply made now. If you buy a warranty there is a 75% chance you are going to use it. Many people do not know how to do that stuff and cost them a lot of coin. If I can insure a $600.00 dollar desktop for 3 years for $99.00. Thats not a bad deal. I see remorse all the time from customers who did not buy a warranty. Now I will admit, a $149.00 warranty on a $399.00 laptop does not make much sense, but on a $700.00 laptop…not a bad idea.

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18 Laptop Repairs London June 18, 2013 at 2:55 pm

Warranty is crucial when you have bought a brand new laptop as the technology nowadays is more expensive and therefore will cost a lot of money to replace or fix.

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