Are Extended Warranties and Service Plans for Computers Necessary - Part 4 of PC Guide

Part 4 of our computer guide covers extended warranties (service plans) and whether it's a good idea to buy it or say "no thanks".

Congratulations...you did it! You've found a great computer at a great price and the stock boy is bringing your computer to the check out. But just as you approach the check out... the salesperson goes into their pitch on the benefits of insurance and why you should buy their extended warranty.

But is the extended warranty (service plan) worth the extra money? It depends on how you look at it and your past experience with them.  Extended warranties are the same as insurance policies, you may need it or you may not.  But why are retailers so insistent you buy them? The truth is simple....They make an enormous profit on them.

There are two main types of extended warranties (service plans) retailers offer; standard repair or replace plans and full coverage repair or replace plans.

A standard warranty commonly extends the manufacturer’s warranty an extra 1 – 3 years and covers the cost of repairing/replacing a computer or laptop if something fails, like the hard drive, motherboard or DVD drive. The down side of this type of warranty is the fine print which usually states that the plan only covers failed components due to “normal wear and tear”. So if you spill soda on your laptops keyboard or drop the desktop tower while moving, you’re not covered. I’ve always had the opinion that these types of warranties are not worth the money because computers today are built to withstand normal everyday use.

Full coverage warranties on the other hand do cover things like soda spills and drops. In the event something fails or you run over your laptop with the car, the retailer will either repair it, or replace your computer with an equivalent model at no additional charge. However, full coverage plans cost significantly more than standard plans and you may end up waiting a loooong time to get your computer back. In my own personal experience, it took the retailer 6 weeks to get me a new computer! Yes... 6 weeks!

So is it worth the money buy and extended warranty on a computer? In my opinion extended warranties and service plans are a waste of money.  It’s far less hassle and in the long term money to use a local computer repair service to fix a problem.  They’ll fix the problem for much less than the cost of an extended warranty and you’ll get it back within a week or less.

The only exception where I’d recommend an extended warranty (a full coverage plan specifically) is when kids or teens will be using it or if you’re buying a laptop for a college student. They’re notoriously hard on computers and you’ll most likely get your money’s worth out of the warranty.