I would always shop the product first. I shop depending on what I think the offering will be. If I’m buying a small coffee maker…I most likely am going to Wal-mart. If I want the bragging rights to the biggest and best TV,Home Theater,HD,ED,Direct TV, Tivo with DVR etc., etc, etc. on my block, I am not going to Wal-mart. Then once I am in the store and make my product decision….then I will decide if I want an extended warranty.

Posted by: Bruce on November 14, 2005 at 3:48 PM

Actually, I am one who generally avoids extended warranties like I avoid the bird flu, except for one product: laptop computers. I’m not going to burn the time and bandwidth required to defend that statement, although I could, because that isn’t my aim here.

When I recently decided that it was time for me to buy a new laptop, it didn’t take long at all for me to start directing the search for my laptop to shopping for extended warranties. Incidentally, I am about to buy this new laptop with help from an $897.42 check that I just got from N.E.W. (National Electronics Warranties, I believe is the name), the warrantor for Sam’s Club. That was the original purchase price I paid for my last laptop, and the amount that N.E.W. just paid me when that laptop, which I bought two years and three months ago, recently crapped out on me!

Now, I originally started looking for a new laptop the “normal way”, by checking out all the sales circulars, searching for the best current laptop deal from the electronics big boys like Best Buy, Circuit City, CompUSA, Office Depot, and the like. It didn’t take long for me to do a rapid reorganization of my search methodology, though, when I started getting quotes for extended warranties from all these guys! I realized then that I needed to shop the extended warranty first, and THEN shop the machine. That may seem counter productive, but trust me, it’s not that at all when you consider that the “big boys” charge between $300 and $400 for a three year warranty on a $1000 laptop, one that starts on the day you purchase the item (regardless of the fact that by doing so it is running simultaneously with the manufacturer’s warranty), and that Sam’s Club and WalMart charge between $75 to $100 for the same coverage period…except that their warranty period starts when the manufacturer’s warranty stops, not robbing you of that first year of paid coverage!!

When you combine all of this with the fact that walmart.com has a VERY good selection of laptops to pick from, well, it’s a lot easier to see why my next laptop is coming from WalMart, or Sam’s Club.

The fact is, buinesses like Best Buy and Circuit City count on these “service policies” and “extended warranties” for anywhere from half to just about all of their entire earnings profit margin. If they collect oh, say, $350 from you for an extended warranty, they will likely pay out less than $150 to a couple other entities for the actual insurance itself and some of the administrative handling thereof, and they pocket $200… FREE AND CLEAR.

Another reason that makes this the best way to go is that in many instances, if not most, the advertised “sales” at Best Buy, Circuit City, and the like are manufacturer’s rebates, the very same rebates that you can take advantage of at WalMart. The only “advantage” that would leave these big electronics shops then is the presence of an informed sales staff…well, I may be wrong here, but I’ll be glad to do my own research on what machine I want. That will also help insulate me from having to listen to the highly inflated claims of protection that these supposedly informed sales staffers seem infamous for attributing to their particular extended warranty coverage.

Posted by: Bubba Phillips on February 20, 2006 at 2:46 AM

That’s a great point about comparing the prices of the warranties. I, too, believe it’s a good idea to buy the warranty for laptops.

What about servicing though? When something went wrong with your laptop, did you have to send it away to have them determine if it was fixable? Or could you just drop it off at the place you bought it and let them take care of it?

Posted by: Janet on February 20, 2006 at 10:35 AM

Janet:

I called the Sam’s Club warranty number printed on the pamphlet that I got with my warranty purchase and they contacted the contractor who was to do the work on the machine, which was, in my case, a company called Cyber-Test. Cyber-Test then sent me a pre-paid shipping box with foam packing in it specially form fitted for laptops. When the box got to my house, I put my laptop in it, filled in a questionnaire concerning the problem(s) with the machine (that was also enclosed in the box that they sent), sealed it all up along with my restoration software and AC adaptor, and dropped it off at a UPS shipping center.

My case was a bit odd because they could not fix the thing. I sent it in three times for repair, and on the last time I sent it in they sent me a check for the full purchase price, less tax and the original warranty price….not bad at all considering I had the thing for more than two years and that the warranty only cost $54.68 when I originally bought it. Of course, the three times I had to send it in aggravated me, but it wasn’t that big of a deal considering that each and every time they paid the shipping costs both ways, and even supplied me with a box, packing and pre-paid shipping labels each time. It only cost me some time. It was the contract company Cyber-Test who failed to fix it, and they made it all VERY good to me anyway.

Now, let me clarify something here….when I say “Sam’s Club Warranty”, I am not really sure what, if anything, Sam’s Club has to do with the warranty service. The warrantor is actually N.E.W. (National Electronics Warranties, or some similar name). I assume that the number I called was them, or that I called Sam’s Club warranty department, and they referred the info to N.E.W., who contacted Cyber-Test. I am more inclined to think that the number I called was direct to N.E.W….it really doesn’t matter as far as this goes anyway. The pamphlet that I got with my purchase was headed “Your Sam’s Club Service Agreement”, but the check that I got came from N.E.W., so I assume that it was completely handled by N.E.W., and that Sam’s Club had nothing to do with it at all. That would make more sense anyway, and if so it seems that Sam’s Club must almost be doing this for a customer service, because I can’t see how they could take the $54.68 that I spent on the warranty and keep ANY of it at all and still be able to purchase a 3 year service policy!

As far as I can gather, it seems that a 3 year warranty from walmart.com is currently about $103 on a $1000 machine, and the same warranty from samsclub.com is about $79, and at that I see no reason whatsoever to not buy either policy. (I consider the $54.68 I spent in Setember of 2003 well spent, I can assure you, and still would even had my machine not crapped out on me!!) The only reason Best Buy, Circuit City and the like have such high prices for the same coverage (or less coverage, really, considering that the coverage starts on the day of the purchase and NOT after the manufacturer’s warranty expires) is because they are clearing several hundred dollars on the sale. It is not an exaggeration at all that one of them actually relied on the sale of these policies for quite literally 100% of their profits during one recent year. It’s hard to tell exactly how much each of these big electronics retailers count on the sale of these policies for their bottom line because of creative accounting processes, as they don’t want it to be common knowledge exactly how much they rely on these sales for their profits.

One other thing: after I started looking into all this last night, I see where the consumer can actually purchase his own similar coverage from some third party vendors regardless of where he purchases the actual item. I haven’t had a chance to really look into these particular policies yet, but if in fact comparable inexpensive coverage is available directly to the buyer, then that’s just one better…find the best deal for the laptop and the best deal for the policy, and go that route. Obviously, one would really need to do some checking to see exactly what type of coverage that (s)he is buying, but I see no reason that the same coverage that is available through these retailers should not be available straight from the warrantor to the consumer.

Oh, one last thing. I am looking at that pamphlet right now, and I see that the coverage includes:

Power surge damage
Normal wear-and-tear damage
Remote controls
Free annual head cleaning on VCRs and camcorders
$100 food loss on refrigerators/freezers
Home and business use (that’s a big one there!)
“No Lemon” guarantee (the “No Lemon” guarantee is the clause that I got the check under)

Posted by: Bubba Phillips on February 21, 2006 at 5:50 AM

Thanks for all that detail! That’s really helpful to know.

Posted by: Janet on February 21, 2006 at 11:38 AM

Can someone give me a p.o.v. on whether it’s best to go with a third-party warranty on a laptop or that of the manufacturer? The coverage terms get so complex that it’s hard to figure out who offers the best coverage. In this case it’s CompUSA or Toshiba.

Posted by: David on April 4, 2006 at 10:51 AM

The problem with purchasing a service plan thru Best Buy is that when the product is replaced, the plan is scrapped and you are forced to buy a new plan. They will not give you a refund for the unused portion of the service plan! Our laptop failed in the 13th month after purchase - the manufacturer’s warranty expired at the end of the 12th month. Best Buy is making a HUGE profit for scamming the public on these service plans. How can you be assured that they are not fixing product under these plans with crap parts?

Posted by: Sue on September 27, 2006 at 4:01 PM

I haven’t had that problem. I’ve had to replace a couple of products that I bought from Best Buy. A notebook computer that I bought (and had a service contract for) died shortly after I bought it. It was replaced, and the service contract was transferred to the new machine. I believe it ran from the original date of purchase. The hard drive on that notebook died a couple of months before the service contract was up (after being lugged through a lot of airports over a couple of years, and they replaced the hard drive. The contract continued for the rest of the time I had purchased it for.

I just had a flat panel monitor die recently, too. That couldn’t be repaired, so it was replaced. I was told (but haven’t had to prove it yet ) that the replacement would be covered through the end of the original service agreement.

Posted by: Janet on September 27, 2006 at 4:40 PM

I would beware of Walmart’s warranties through Cyber test. I recently had my laptop go out. I was told the problem was caused by moisture damage. I was not told what the problems were caused by the moisture. Well, nothing has ever been spilled on this computer, so where did the moisture come? I luckily had taken it in to local computer shop because I thought my warranty was up. I was told it would cost $600-$700 dollars to fix and they did not recommed spending that much money. They did not try to sell me a new computer either. When Cyber-Test was confronted they said to contact Walmart. After several calls, I spoke with a supervisor. I told him nothing was spilled on this computer and I wanted to know where the moisture
came from. I said it either had to be the mailman or Cyber-Test or perhaps there really was not any.I was told perhaps it looked like moisture damage but really was not. This supervisor said he would make it right. When we receive the moisture damaged computer back, we are suppoed to take it back to the local shop to see what they say. It was ironic,when my daughter contacted the local shop, one of the employees that worked there said he had purchased a computer from Walmart a while back. After having it for 3 days it had problems and he sent it in. He also was told it was caused by moisture. We shall see what will be found inside the laptop when the local company opens it.

Posted by: Donna on November 11, 2006 at 1:18 AM

I purchased a computer and an extended warranty from Wal Mart. What a rip off! The computer has been sent away for repair twice in a year, and still is not working. They dropped the ball on my 3rd request, and 3 months of the extended warranty have waisted away, while I wait for a box to be sent to me, so I can send the computer in YET AGAIN! I see complaints above regarding Walmart’s contracted repair center: CYBERTEST. They returned my computer to me in the same condition it was when I sent it to them: NOT WORKING. There are no managers that take phone calls at Wal Marts customer service center, and the service reps act like a bunch of robots. They lose records, hang up on me, drop the ball, and NEVER APOLOGIZE for shitty service. They are experts at passing the buck, and the whole extended warranty is a rip off, as a result. I had to purchase a second computer now, because I have waited over 6 months for the Toshiba to be repaired. Additionally, they tell me that I will be required to send the computer in ANOTHER time, if I am to be considered for a refund. WHAT A RIP OFF!! They do not care, and are incompetent!!!

Posted by: Sandra on June 27, 2007 at 3:43 AM

Christmas 2005 I was blown away by my parents when they had bought me a nice, top of the line (at the time), Toshiba Satellite laptop with everything short of Bluetooth 1.2. It worked fine, and did show some sign of wear over the year I used it and allowed me to stay in touch with friends while I was sick last year.

On November 3rd, 2006, my laptop died. I figured it was a corrupted video card file, and I fixed it for awhile with a system restoration. Then, before July 4th it died. It wouldn’t power up or do squat. My Mom called Wal-Mart, and had the warranty company Cyber Test process a RMA. It was back there, and back to me in two weeks. They had to wait for parts the first time.

I got the computer back, but it looks like they had DROPPED the system and had tried to cover it up with putting in a new LCD. I could tell the difference immediately as my display had a small defect that I had lived with. Also, the right speaker no longer worked as that is where the damage was.

So, it went back AGAIN and in seven days time they said they fixed it and sent it back. As soon as I got the package with the laptop back, I opened it and inspected it. Looked okay, still same damage visible areas where they had dropped it but they popped things back together. However, the original problem with the computer spontaneously shutting down returned with the computer.

Now, my mother and I have to start the whole process over again. I’m going to push for a refund from them if they can’t get it fixed, and fixed right, this time even if it means a small claims against the idiocy called Cyber Test.

I will adamantly say I’d pay the price difference for a Best Buy warranty as I’ve had several save my ass on PDA and electronics purchases. I’ve seen in more situations then not anymore that you truly get what you pay for.

Posted by: Shane on August 18, 2007 at 3:30 AM

Hello, I purchased a Toshiba Laptop Satellite A-55 from Wal Mart. Not too long afterwards, the DVD drive started malfunctioning. Exchange made, and computer now working OK. Subsequently, a new acquaintance, who is manager of a local computer sales/service company, indicated that several big name companies construct computers to WalMart’s specs which contain some lower- quality components. (His shop is currently repairing several WM-purchased Toshibas.)
I saw a recent WalMart ad indicating a Toshiba laptop with lots of goodies for a cheap price( $560 ) however, they had in stock only two Toshibas costing $800-1000. this computer guy can make up for me a Toshiba with what I want for almost the same prices with an on-site multi-year repair contract. Richard Imboden, Cottonwood, AZ

Posted by: Richard Imboden on September 12, 2007 at 12:09 AM

I bought an HP laptop from Wal-Mart and purchased the extended warranty through N.E.W. I will say this, I would rather pay the extra $150+ for a warranty directly through HP than to have to go through what I have gone through when I had to ship my laptop in to Cybertest, the company N.E.W. contracts out for their warranty repair.

First time was my hard drive crapped out. It was still under HP warranty. Wonderful service! They sent me a new HD within two days and that same day I got the new HD I sent the old HD back to HP via FedEx (prepaid by HP).

A month or so later the HD (or so I thought) crapped out again. By now it had been a year and my HP warranty had just expired, so my two-year extended warranty through N.E.W. kicked in. This was a pain in the arse!

I was informed that they don’t just send parts to people, despite the fact that they had already troubleshooted the issue over the phone. They were going to send me an empty prepaid box via UPS and I would receive it in three days. Then, I was to send my entire laptop in to them.

I get the box from UPS and I call UPS to come pick it up. Sure, for a nice little fee of $10.00. FedEx never charged me to come pick up a prepaid package, but UPS sure wanted to. So I had to go drop it off at an authorized shipping center.

After about a week I called Cybertest to check on the status. I was told that the motherboard in my laptop was on recall from HP and that it had to be sent to HP and they would be getting it back from HP in about a few days. I called almost a week later. I was told that my laptop was still at HP. I asked if they knew the status. They said no. So, I asked if they could find out the status. I was told, “If HP calls us then we will call you with an update.”

I was furious. These lazy people couldn’t take a few minutes to give me an update. I called HP to find out myself. At first I kept being told that my laptop was not there. I called Cybertest back and the guy, in a rude tone, told me that HP was lying to me and I needed to check my information out.

I asked him then if he could give me the tracking number for the UPS package. I had to call UPS. A UPS representative told me the exact date, time, location, and person that received my laptop.

Now I’m back on the phone with HP to let them know about my investigation. They then admit that they have my laptop. I then ask what’s the status of it. I was asked if I was from Cybertest. I said that I wasn’t but I was the owner of the laptop. I had previously confirmed all of this info by giving them my make, model, and serial number. They told me that because I was not from Cybertest that they could not tell me any information.

In other words they couldnn’t give me an update about my own property. This was ridiculous! I demanded to speak to a manager. I was refused and told that a manager would only tell me the same thing they were telling me. They did, though, end up escalating the issue after I threatened to sue for theft of private property.

A representative called me the following Monday. I was told that the hold up on my laptop was that they were waiting on payment from me for them to repair the hard drive. I explained that the hard drive repair was to be done by Cybertest and that the only reason that my laptop was sent to them was because of a factory recall on the motherboard in my laptop. The representative then told me that my laptop would be shipped back to Cybertest.

Cybertest finally got it about 3 days later. They then had to repair the hard drive and reinstall my OS. Then send it back to me. In all, it took close to a month between sending my laptop in and getting it back.

The worst part was that HP was reluctant to give me information about my own property and that Cybertest was very unprofessional in handling the situation.

I do believe my next computer will be a PC that I build myself. My last PC I built lasted five years with no hitches except the original power supply that died.

My DVD drive in the laptop has just died on me, however, I will be waiting until I build my new PC before I send it off to Cybertest. I do know that it will be a cold day in hell before I buy any warranty from a company that uses N.E.W.

Posted by: Nick on February 4, 2009 at 12:47 AM

If you purchase an extended warranty through Walmart and you end up needing to use it youre in for a wild ride. I purchased my laptop in jan of 07 and in jan of 09 my dc jack was loose so I sent it in to be replaced. The company N.E.W. contracts their repairs out to is Nexicore and after getting my laptop back from them the repair checklist mentioned making repairs to the motherboard when I sent it in to have a simple 35 dollar part replaced. Nexicore had damaged my motherboard when making the repair! To make a long story short after going through hell with Nexicore, N.E.W., Walmart and sending my laptop in twice, I finally got a check sent to me to replace the laptop. Lessons learned: If you purchase a laptop from Walmart do get the warranty. However, back up all your files before you send the laptop in because once they open it up it will most likely be damaged during repair. Be prepared to have a 2 month battle ahead of you to get your laptop replaced. Call 1-800-walmart and file a complaint with their corporate mentioning that you will file a suit for breach of contract naming both Walmart and N.E.W. in the claim if your issue is not handled properly. Do not let them replace your laptop unless you are getting the same laptop or better as your warranty states. In most cases being that your laptop will be older than a year when you are under coverage by N.E.W it will be impossible for them to give you every single feature you had on your laptop in a new model. Therefore, they will have no choice but to send you a check.

Posted by: anonymous on April 18, 2009 at 5:11 PM

I too have had a run in with Walmarts extended warranty. I purchased a acer laptop from Walmarts with the extened warranty and had it sent in for a bad screen and the next time a bad touch pad. I received it back from micro medics and not even a week went by and had to send it to cyber Test. and lord and behold they found liquor spilled in the keyboard and oh yes unable to repair my laptop. that was a bunch of crap and now its my problems. well as you can see Walmart is just trying not to repair the problem once again.

Posted by: Darlene Youngman on April 24, 2009 at 1:59 PM