Part-by-Part Extended Warranty Torture

While many consider it a waste of money to buy an extended warranty, flat panel TVs are the type of expensive and failure-prone product for which you might make an exception. But a pattern is emerging in reports from my readers that suggest you’d best think otherwise. By insisting on trying to fix defective devices with one futile part replacement after another, flat panel TV retailers and service organizations are making extended warranties both a waste of money and time.

“I purchased an Insignia flat panel television from Best Buy less than two years ago, along with an extended warranty,” a reader in Texas recently wrote. “Last month I was watching the TV when it simply stopped working. Best Buy sent a tech out a few days later who said he’d have to order a part to fix it. That didn’t work, and the next tech they sent out requested that Best Buy replace my unit because he couldn’t get it repaired, but twice Best Buy refused his request. I’ve spent hours on the phone with Best Buy’s Lack of Customer Care Department, and hours scheduling more attempts to replace different parts. But apparently once the decision has been made to deny a replacement, it’s easier to get an audience with the Pope than to talk to someone at Best Buy who can change that decision.”

When you pay big bucks for a product, and additional big bucks for an extended warranty, shouldn’t that buy something other than an interminable wait to have it repaired? “The tactics Best Buy and others are using with their extended warranties is an issue that needs to be raised,” wrote another reader with a family member whose HD TV had given up the ghost. “His warranty says that he can get it replaced if he is not satisfied with the product, but Best Buy says they get to take as long as they want to try to repair it. After his set went out, they did finally agree to come pick it up, but it took them six weeks to fix it. What good is a warranty that takes your big flat screen HD set and leaves you with a big hole in your den while you watch whatever old TV you have lying around?”

It’s not just Best Buy though — another name that keeps surfacing in many of these situations is GE, which often winds up with the service contract for the extended warranty. “My story is the same,” wrote one reader in response to a previous story about Good Guys, CompUSA and GE all failing to honor an extended warranty on a Sony plasma TV. “I purchased an LG Plasma TV from a Good Guys store that has since closed, and my $1,000 extended warranty was sold to GE. Two years and four months later, the TV does not work. GE recommended an ‘authorized’ local repair service that took two weeks just to set up an appointment to come verify the TV doesn’t work. The technician said he would have to order a part from LG, because this is the process GE makes him go through. But he was certain the part would not fix the problem. Oh, great. Three weeks later the part is in and an appointment is scheduled another week out. On the day of the appointment the local repair service cannot be reached because their phones are down — my appointment is missed and I have to reschedule another week later.”

Adding to her frustration, the LG customer has since discovered that the local repair service GE sent her to has a very dubious history with the Business Better Bureau and doesn’t appear to have a business license. “Repeated calls to GE Warranty Services are greeted with an I-could-care-less attitude. Here I paid $1,000 dollars for an extended warranty and, seven weeks after my TV fails, I’m still waiting for service. My advice to anyone who has the misfortune to have their very expensive extended warranty plan sold to GE is to be prepared for a long and frustrating journey. I will never again buy anything from GE, backed by GE or serviced by GE. Their only interest is in growing bigger and making more money for the Chief Executives — GE customer service is a thing of the past.”

A big part of the problem is that extended warranties are often serviced by third parties like GE that might have little incentive to keep the customer happy and can also have their own interpretation of what is covered. “I purchased a Samsung HLP-6163-WX DLP TV through my Good Guys’ account a couple of years back and got the extended warranty because the salesman assured me that the lamp was covered,” wrote another reader. “Unfortunately, I’m now being told by GE that the part is not covered under warranty because ‘it’s a user-replaceable part.’ She said it was my fault for not reading the contract I signed. I asked the rep to send me a copy of this contract that says it cannot be replaced and she says they can’t do that either!”

Of course, it’s almost certain that somewhere deep in the fine print of the original warranty agreement there is language that can get the vendor off the hook. “As far as extended warranties, I’ve never seen one that was all inclusive,” wrote another reader. “In fact, there is usually a list of parts covered and/or not covered a mile long. Most people don’t know enough about Plasma TVs, or any other complicated electronic device, to know what parts are expensive or wear out quickly. The warranties seem to be written to take advantage of a person’s lack of knowledge. I always thought that technology was supposed to make our lives easier and more comfortable, but it seems more and more that companies are trying to stick it to their customers.”

The reader in Texas would agree, although I’m happy to report that — after complaining to the Best Buy store, the Best Buy CEO, the Better Business Bureau, and everywhere else she could think of — she was finally given an in-store credit to replace her broken flat panel TV. But she’s still not a happy camper. “I had to miss time from work, time for which I was not paid, to be available for the repairman. I paid an expensive cable bill for cable service I wasn’t able to enjoy. I don’t understand why repairmen can’t carry parts or a diagnostic tool with them rather than make me wait a week for each of the parts that were ordered. And it would seem to me that after three service calls weren’t able to resolve the problem, that another more productive solution would have been found rather than continue to replace parts at random. Yes, I replaced my television, but this issue isn’t over for me. Everyone in the store told me that they hear complaints like mine day after day. It’s sad they are treating customers like this — don’t they understand their business depends on people like me?”

Unfortunately, I think what executives of Best Buy, GE, etc. understand is that a lot of their profits depend on customers not ever collecting on pricey extended warranties. Extended warranties are a lot like rebates that way – in fact, maybe they’re even worse in that the customer has more money at stake. So if over this holiday season you’re going to be shopping for a flat screen TV or other expensive gadgets, you might want to keep that in mind.

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