Be aware

The Pilot - - Editorial -

There’s surely noth­ing cheery about the liq­ui­da­tion of Sears Canada af­ter 65 years in busi­ness and the thou­sands of jobs axed across the coun­try. But one pos­i­tive piece of fall­out from the death of the re­tail gi­ant is the talk that’s been gen­er­ated about ex­tended war­ranties and whether they’re worth the pa­per they’re writ­ten on.

Since Sears Canada an­nounced it was go­ing out of busi­ness, sto­ries have started com­ing to light about peo­ple who had made ma­jor pur­chases from the store — kitchen ap­pli­ances, fur­ni­ture and the like — and pur­chased ex­tended war­ranties, only to find out they will no longer be hon­oured and they are in­el­i­gi­ble for a re­fund.

Only those who bought so called “pro­tec­tion agree­ments” from Sears within the last 30 days will get their money back.

It’s un­der­stand­able that peo­ple want ex­tended war­ranties. Who hasn’t made a ma­jor pur­chase at some point that turned out to be a lemon?

But the ad­vo­cacy group Con­sumer Re­ports says peo­ple are bet­ter off set­ting money aside for re­pairs that they would oth­er­wise spend on ex­tended war­ranties, since of­ten they don’t offer as much pro­tec­tion as you might think.

“Ex­tended war­ranties can have many gotchas, re­ly­ing on con­tract fine print to deny cov­er­age for al­most any rea­son,” Con­sumer Re­ports warns. “They’ve be­come a ma­jor source of com­plaints to the Bet­ter Busi­ness Bureau and else­where. …

“Ex­tended war­ranties also can ex­clude a va­ri­ety of parts. For ex­am­ple, among the re­frig­er­a­tor parts that aren’t cov­ered un­der one home ser­vice con­tract we re­cently re­viewed are ice­mak­ers, bev­er­age dis­pensers, door seals and gas­kets, hinges, light­ing and han­dles. An auto ser­vice con­tract we ex­am­ined ex­cludes brake drums and ro­tors, air bags, door han­dles, lock cylin­ders, the ex­haust sys­tem, body pan­els, among other parts.”

Those are pretty key parts. Viewed through a cyn­i­cal lens, you might sus­pect some com­pa­nies bank on their cus­tomers not hav­ing the time to wade through all that fine print.

Of course, not all ex­tended war­ranties are bad, but con­sumers should take the time to read them through be­fore they pay for any­thing.

And you might al­ready have all the pro­tec­tion you need.

Many credit cards offer ex­tended war­ranty pro­tec­tion that adds be­tween one and three years of ex­tra cov­er­age to the man­u­fac­turer’s war­ranty.

The blog greedyrates.ca of­fers a com­par­i­son of Cana­dian credit cards with the best ex­tended war­ranties here: http://www.greedyrates.ca/blog/ ex­tended-war­ranties/

Again, you need to read the fine print; some credit cards offer pro­tec­tion in Canada only, so if you’ve made your pur­chase else­where, your card might not cover it. Your card also might not cover some items at all — such as a mo­tor ve­hi­cle, or it may not pay for com­puter parts and re­pairs if the model you bought was re­fur­bished.

With a lit­tle re­search and the right card, though, you could save your­self hun­dreds of dol­lars.

The devil, as they say, is in the de­tails.

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