The Commissioner for Consumer Protection, Lanie Chopping (pictured) has warned people against paying for an extended warranty on a product when they could probably get it for free.
“This is because products are automatically guaranteed in a number of ways under the Australian Consumer Law (ACL), which may apply even after the warranty period has lapsed,” Ms Chopping said.
She said that in the past two years, Consumer Protection had received more than 1,300 enquiries and around 230 complaints about extended warranties, mostly to do with difficulties accessing a repair, refund or replacement when a product develops a fault within the warranty period.
She said that under the ACL, any product or service purchased from a business must be without faults, fit for the intended purpose, match any description or sample, as well as last a reasonable amount of time depending on what it was and how much it cost.
“Businesses sometimes try to convince consumers they need an extended warranty or care package to receive a solution for a fault that occurs after the manufacturer’s warranty expires, but in reality this insurance policy may be for a scenario already covered by the law,” Ms Chopping said.
“Take for instance a $2,000 television that comes with a manufacturer’s warranty of 12 months; should that device become faulty after 18 months, consumer law will already protect the purchase because it is reasonable to expect an expensive TV to last longer than one year.”
She said that where a consumer goes for help with a faulty product might depend on which rights they were exercising.
“For ACL issues you can contact the retailer, while a manufacturer’s warranty issue may need to be taken up with the manufacturer directly,” Ms Chopping said.
“Extended warranties are generally provided by an external company (third party), so these issues may need to be reported to them. Check the paperwork received when buying the product for any contact details.”
She urged a potential buyer being offered an extended warranty to ask the salesperson for a clear explanation of the benefits above the entitlements under the ACL.
“Retailers or suppliers risk breaching the law if they use unfair tactics or put undue pressure on you to buy an extended warranty, or mislead you into paying for the rights you already have under the law,” Ms Chopping said.
