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Often the butt of retailers, Choice, the consumer watchdog, is now having a go at extended warranties and the “poor training” of retailers selling what is a very lucrative segment of consumer technology retailing.In a recent survey carried out by the website/magazine, more than 95 percent of the 570 respondents said they had been offered an extended warranty, however a large number of those people were unsure what they were getting themselves into. For a start, most extended warranties are not being offered by the retailer, but by a third-party who don’t even enter the picture.
Choice’s main criticism though is the necessity of the warranties and why they are needed in the first place.
“[Conumers] already have protection under statutory warranty so why do they need extra cover for?” says Choice spokesman Christopher Zinn. “Also [the warranties] have too many exclusions and people don’t get the chance to sit down and talk them through.”
Zinn said it would be best if the CE retailing industry worked with government to address the issue. There needs to be certain things put in place to safeguard the consumer, he says.
“When asking people to take the warranty they shouldn’t have a take-it-or-leave-it agreement at the sales desk when they buy the product,” Zinn says. “Consumers should have 30 days to come back – there needs to be an adequate termination agreement (cooling off period) where consumers can change their mind.”
Also, consumers need to be aware that not all sales staff are adequately trained in the idiosyncrasies of the warranty agreements, and there are probably financial incentives for the sales people to seal the deal.
Zinn says just be aware of what you are getting when you sign up for your warranty. Especially take into account that it is not an extension of the manufacturer’s agreement, but something altogether different.
