Money
Getting the best deal
Christmas shopping: beware warranties
Consumers are being warned to think twice about buying expensive and unnecessary extended warranties alongside electrical goods during their Christmas shopping sprees
Warranties, usually sold by retailers, offer extended cover to insure against faults and breakdowns, beyond the usual 12-month guarantee from manufacturers.
You can buy extended warranties to cover everything from toasters to televisions.
However policies are expensive - sometimes exceeding the price of the original purchase - and often worthless.
The Office of Fair Trading and consumer group Which? both say that in many cases a warranty is simply not necessary, because modern electrical and white goods are pretty reliable.
And according to the OFT, if a purchase does break down, it is usually still cheaper to pay for repairs rather than buy a warranty.
As technology improves, a model can quickly become obsolete so prices drop. This means replacing a faulty item might work out cheaper anyway, or perhaps the latest model with better features is worth splashing out on.
The shop where you bought the item should, of course, be your first port of call if it breaks or stops working.
Under the Sale of Goods Act, goods have to be "reasonably durable" so whether you have an extended warranty or not, a washing machine that is just over 12 months old should not be expected to clap out.
For expensive items, there is an argument for buying an extended warranty if you are nervous about large repair bills. But don't be swayed by policies that include theft and accidental damage cover, because this is often covered by your home contents insurance.
Don't settle for those offered by stores without checking for cheaper policies with independent insurers.
Hard-sell techniques used by big high street electrical retailers to sell expensive additional warranties at the point of sale have been a concern for some time.
There have been repeated investigations into extended warranties, including requirements to make the pricing more transparent and to give consumers a 45-day "cooling-off period" to change their mind. So if you do buy from a retailer and find a better deal elsewhere, you have a few weeks to get a refund.
Independent firms, such as Warranty Direct or The Warranty Club, can offer stand-alone cover which can be better value.
It can save you a decent amount to do your homework rather than just signing up at the till.
Before buying any policy, read the small print for the exclusions as these will determine what repairs you can and cannot claim for.
* Holly Thomas is an award-winning financial journalist and Deputy Personal Finance Editor at the Daily Express and Sunday Express. Holly's views represent her own opinions and are for general information only. Always seek independent financial advice.
