As soon as we hear the words, ‘Extended warranty’, we usually start running in the opposite direction impulsively. Such is our mental conditioning that we immediately start thinking about that extra bucks we have to pay without getting any real benefits. However, the truth is that most of us do not even understand what extended warranty actually is and what benefits we are entitled to avail under it.
Rahul had this kind of mental block a few years ago. When he purchased a fully automatic washing machine from a nearby dealer, he was offered to get an extended warranty on his new appliance by paying a nominal amount. However, he refused immediately! On insisting further, he got furious and was on the verge of shouting at the salesperson as if he was trying to pitch the product to him.
Next week, when his best friend Kartik came to visit him, Rahul showcased his new washing machine to his friend. After seeing it, Kartik told Rahul that even he had purchased a washing machine last month only. He also mentioned that he also got the extended warranty from the store.
Rahul laughed at Kartik and proudly bragged about how he fought with the salesperson and prevented them from making a fool out of him. Kartik looked confused and asked Rahul why he didn’t opt for the extended warranty on his washing machine? Rahul said that this is only the way of extracting more money from the customers, but he was clever enough to deny it.
Kartik laughed at this and asked Rahul if he actually knows what extended warranty means. As suspected, Rahul didn’t have the slightest idea! Kartik then went on to explain that his washing machine had a warranty of 12 months. It meant that if his machine malfunctioned within 12 months of purchase, the company is bound to repair it for free.
However, with an extended warranty of 1 year that Kartik opted for, if the machine broke down within 2 years of purchase, the company would be liable to repair it free of cost.
Rahul exclaimed that the charge they would take for this would be ridiculous!
Kartik then asked him the price of his washing machine to which he said, “Rs.10,000”. Then, Kartik asked him the cost for the extended warranty, to which Rahul replied ‘Rs.599 for 1 more year and Rs.999 for 2 years after the expiry of the original warranty period.
Kartik then continued that there are several other parts in a washing machine that can get damaged and replacing them can cost him a fortune.
Rahul looked stunned! Kartik told him that if his washing machine needed replacement of parts, the company would do it for free as long as the machine is covered under the warranty. However, in case a buyer did not opt for an extended warranty and if the machine malfunctions after 12 months, then he will have to shell out thousands of rupees from his pocket.
Kartik added that this is the reason why he decided to get an extended warranty on his washing machine. After hearing all this, Rahul sheepishly confessed to Kartik that he had actually been a fool to refuse the extended warranty.
Kartik then informed him that he could still get an extended warranty on his washing machine. As Rahul took his motorbike keys, Kartik asked him where was he planning to go? Upon learning that he intended to visit the store for getting an extended warranty, Kartik told him that it could be done online as most insurance companies offered this facility.
Hearing this Rahul heaved a sigh of relief, shook hands with Kartik and thanked him for all the information.1