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Old September 24th, 2009, 06:00 PM   #1
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Extended Laptop Warranty

Just got $700 laptop with 1yr warranty. I can add 2 yrs SquareDeal for $60 and no fault for an additional $50. I'm aware 3rd party warranties companies can be shady but I read a lot of positive reviews of SquareDeal, so I'm not concerned about that part. I'm ok with the terms, 5 day turn around they pay for shipping, doesn't cover accessories such as the battery.

So value wise is it worth it? I know its a subjective question. I've never bought an extended warranty before, but laptops are more susceptible to hardware failure and damage because of their portability.
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Old September 25th, 2009, 12:36 AM   #2
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I guess the best way to look at it is to think about what percentage of the price of the machine you're paying and what the real value is to you.

For example, most computers (not all, but most) and other reasonably well designed and manufactured stuff like hard drives etc exhibit a so called "bathtub curve" - early life failure due to manufacturing defect is relatively high, late life failure rates due to plain old age are high, and mid life failure rates are pretty low. So statistically if you get past the frst year (usually covered by the manufacturer's warranty) you are statistically at pretty low risk

I think $110 is maybe 20% or 25% of what it would cost you to just replace the machine after a few years.

Looked at another way - the people offering the extended warranty expect to make a nice profit at your expense.

So the key is how big a hit it would be to you if you had to buy another machine in a couple of years and whether it's worth paying such a big percentage for the "insurance" against such an event.

I've almost never had the answer come out in favor of paying for the extended warranty.

Just think of it as insurance and ask yourself if you'd pay such a high premium for it.
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Old September 25th, 2009, 09:41 AM   #3
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I agree when I think of it in those terms its on the pricey side. In addition the value on computer depreciates so much that after a couple of years its value would be half.

I think I'm going use the money to purchase a hard shell case for it, protecting it from damage during transportation. I'm still on the fence about $60 for 2 yrs for non accidental insurance, but like you said most problems happen with in the first year.
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Old September 25th, 2009, 10:29 AM   #4
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A lot would depend on what your comfort level is with doing maintenance and work on your laptop. Personally I have no problem with a complete rebuild of my laptops so it's no big deal for me to make any repairs necessary.

The two biggest issues problems that laptops experience are hard drive or optical drive failures and screens going dead for a number of reasons. Both are issues you could fix fairly easily with the purchase price of the part needing replacement or repair.

For cost of repairs also look to make sure there isn't a deductible. Another thing to think about is the fact that you are paying for 3 years of insurance on the laptop. Will you realistically be using the same machine in 3 years. Probably not. The way technology is going and the way software designers are going most machines will be usable for video editing for only 2 years. After that, the demands of the current software and encoding schemes will most likely demand a much more powerful machine. That's just based on the last 5 years of what has been happening in the video industry.

As Jim said you are really paying for peace of mind. Looking at the raw numbers and statistics I can tell you that many studies have been done and they all come to the same conclusion. Don't buy extended warranties. They are actually the biggest money maker for any retailer. If you want the peace of mind of having the insurance then by all means get it. But, if your really looking at value in subjective measures, then no it isn't worth it.

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Old September 25th, 2009, 10:59 AM   #5
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I can make minor repairs and in fact I'm planning replacing the hard drive with a 500gb, which comes with a 3 yr warranty. The only parts that would be worth covering are motherboard and display. The biggest risk I can foresee is tripping over the power cord, damaging where it plugs in or causing it to hit the floor.

But like you said the extended warranty isn't a great value more for peace of mind. Btw, its not for editing its for onlocation video capture and monitoring, and I can see myself using it for as long as I'm doing this type of work.
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Old September 26th, 2009, 01:48 AM   #6
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Originally Posted by Pete Cofrancesco View Post
IThe biggest risk I can foresee is tripping over the power cord, damaging where it plugs in or causing it to hit the floor.
That would be covered by regular insurance for accidental damage not by an extended warranty.
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Old September 26th, 2009, 10:07 PM   #7
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I have never had a good experience with an extended warranty from a retailer. First of all, I almost never buy them. I look at them as insurance: I buy insurance to protect me from financial *disaster*, not financial *inconvenience*. Having a $700 laptop die would be inconvenient, but it would not be a disaster.

Second, on the rare occasion I've had an extended warranty (typically added on free as a "deal sweetener", or the even rarer circumstance where I willingly paid for it) I have never received satisfactory service from an extended warranty. They always find a way to disallow your claim. I've had that happen three separate times - each time they claimed that my specific problem was not covered by the extended warranty.

Actually, one of the best options for extended warranty coverage may be offered by your credit card company. Many "Platinum" cards offer automatic warranty extensions. I used to purchase all my electronics with American Express. They would automatically double the manufacturers warranty up to one additional year. I once had a television die during that extended warranty period - I called Amex and they immediately credited my account for the full purchase price of the television.
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Old September 27th, 2009, 07:12 AM   #8
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As a rule, I don't buy extended warranties either. However several years back I did get the AppleCare warranty on a Mac laptop. Turns out that it was a good call. A couple years later I had an issue with the laptop not recognizing memory that I installed. The result was 3 different motherboard swaps which didn't cost me anything.

Now this was a rather specific instance (was discussed on DVinfo pretty extensively) with a defect in certain Apple Powerbooks. It was also a warranty from the manufacturer and Apple's support - carry-in at their store - was excellent. I ended up buying the extended warranty on my next Apple laptop after this experience, although I have not needed it yet.

I don't buy those third party warranties myself since it's only as good as the company behind it.
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Old September 29th, 2009, 08:49 AM   #9
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You also need to read the fine print. Often, extended warranties start at the time of purchase, overlapping the manufacturer's warranty. So while you may pay for 2 years, you're only in fact getting one year.

In the 2+ years that I've owned my laptop, I've had to replace the keyboard due to a coffee spill (not covered), the battery (not covered) and the screen. Even had the insurer NOT found a way to weasel out of replacing the screen (which is uncertain), the $100 it cost me to replace it is still lower than an extended warranty. And even had the warranty covered the keyboard and the battery, I'm still ahead with a total of $210.

Of course, as someone else has stated, it helps if you know how to replace things like that. But I think that's how extended warranties prey on people, by exploiting their fears and insecurities.

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Old September 29th, 2009, 07:12 PM   #10
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I purchased an extended warranty on my Alienware when I bought it. Extended to the max 3 years. I have easily used over $1k in repairs on that system. But it was also my primary edit system (heck, I'm using it now in a Hastings!). I couldn't afford to have it go out on me.

I also am extremely warry of the durability of mobile systems. They just aren't as beefy as desktops.

I have had a lot of work done on this lappy: replaced LCD backlight bulb in 1st year; replaced DVD-RW drive in 2nd year; replaced entire Mobo & GFX card for overheating issue near the end of year 3.

THe extended warranty, despite costing some $200, was absolutely worth it for me. But then again, I used that system for 10hrs a day 6 days a week for several years. Easy to wear out a lappy with desktop type usage patterns.

Also, the system cost $3k when I bought it, so that is a significant investment to protect.
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