Consumers facing cost of living squeeze should ditch worthless warranties to save cash, Which? finds

Extended warranties from some of the biggest online tech stores are not worth the extra cost – especially as consumers face a cost of living crisis, Which? warns.

Which? surveyed 2,000 UK consumers and found one in five bought a retailer’s extended warranty for a tech or appliance product in the past two years. However, half of those who made a claim using their extended warranty in the past two years told the consumer champion they had experienced problems.

Which? looked at the insurance plans and extended warranties for tech and appliance products sold by some of the biggest online retailers – Amazon, AO, Appliance City, Argos, Currys, John Lewis and Very – and found that the cost and cover of each policy varies dramatically.

The consumer champion’s survey revealed that, on average, extended warranties are taken out for just over two years at a cost of £84.80 a year – although this differs slightly by the product and retailer. For example, if you buy a new HP laptop, a year’s cover with Argos is the most expensive, costing £112.68 a year via monthly instalments.

AO charged the most to cover a Hotpoint washing machine, with plans starting from £6.99 a month for this type of appliance, adding more than £83 a year to the cost. Currys’ care plan was also at the more expensive end for laptops and washing machines.

However, Which? research suggests it might cost consumers less to organise any unexpected repairs themselves. Depending on the fault, getting a laptop repaired costs an average of between £68 and £78 – although more expensive faults such as motherboard failure could set you back significantly more.

Similarly, the average repair cost for a washing machine is between £82 and £108. So instead of buying an extended warranty for a fault that might not happen, consumers will very likely be better off organising their own repairs if the product does become faulty.

Which? also found that comprehensive cover is far from guaranteed with extended warranties. For example, Currys offers a more expensive care plan for laptops and washing machines compared with other retailers but is the only store not to include accidental damage in its warranty. Its plan, as well as Argos’, does come with additional technical and customer service support though.

Consumers could also be paying for breakdown cover that is already included in the manufacturer’s guarantee. Most of the products Which? looked at came with a manufacturer warranty of at least one year, with some lasting two or five years, and typically these would cover you for breakdowns.

The warranties offered by Amazon, AO, Appliance City, Argos and Very come with breakdown cover, but their policies do not allow you to claim for breakdown problems that are included in the manufacturer warranty. This means that consumers are really only paying for accidental damage cover until the guarantee period ends. John Lewis’ extended warranty for TVs and laptops only covers you for accidental damage and not any breakdown issues.

Some of the schemes also come with surprising caveats. The warranty offered on Amazon’s site  – which was one of the cheaper options for all three products we looked at – only allows three successful claims during any 12-month period. Depending on when the customer notices the fault, they could be entitled to more than this under their statutory consumer rights. Most of the other policies offered unlimited repairs.

Some of the retailers state that in the event of a replacement they cannot guarantee a like-for-like product, which is inferior to your statutory rights. Very’s policy says your replacement might not be brand new or the same colour.

Under the Consumer Rights Act 2015, people are entitled to a full refund, repair or replacement if they notice a fault within 30 days. After 30 days, consumers can ask for a repair or replacement. If the retailer fails to repair or replace it, they can then ask for a full refund as long as it is within the first six months. After this, the retailer can deduct for usage.

If the customer discovers a fault within the first six months after buying a product, it is presumed to have been there since the time of purchase unless the retailer can prove otherwise. Statutory rights last for up to six years in England, Wales and Northern Ireland and five years in Scotland.

Natalie Hitchins, Which? Head of Home Products and Services, said: 

“Although it is hugely disruptive when a tech product or appliance breaks, our research shows that extended warranties and insurance plans just aren’t worth the extra cost as they don’t cover you for as much as you might expect.

“If you’re looking to cut costs during the cost of living crisis and want to cancel your warranty, you should receive a full refund if you cancel within 45 days and haven’t made a claim and a pro-rata refund after then.

“If you do want the extra protection on your appliances, or don’t think you could afford the upfront cost of a repair yourself, it’s worth looking at home and contents insurance that covers all your tech and appliances for accidental damage, rather than having individual plans for each product.”


Notes to editors

Case study

Which? member Peter Wickett paid £40 for Very’s two-year extended warranty for his Fitbit in 2020. When his watch strap broke at the start of 2022, he was surprised when Very refused his claim, stating that his warranty didn’t cover him for breakdowns until after the manufacturer guarantee period. After unsuccessfully contesting Very’s decision, Peter contacted Fitbit directly and it replaced the product as a gesture of goodwill. Peter, who has a number of extended warranties with Very, was disappointed by what happened. Very apologised for Peter’s experience but said his policy only includes accidental damage until the manufacturer warranty expires.

About the research

Which? surveyed 2,000 members of the public in April 2022. Fieldwork was carried out online by Opinium and data has been weighted to be representative of the United Kingdom population (aged 18+).

A fifth (22%) of respondents said that in the last two years they have paid for a retailer’s extended warranty for a tech product or domestic appliance. The sample of people with extended warranties Which? was boosted (500 responses) to find out more about the experience of those with an extended warranty.

The figures on the cost of laptop repairs came from Which?’s Tech Product Experience survey in March 2022 which had a sample of 16,097 respondents from the Which? Connect Panel and Lucid.

The figures on the cost of washing machine repairs came from Which?’s Large Domestic Appliance Product Experience survey in September 2021 which had  a sample of 17,422 respondents from the Which? Connect Panel and Lucid.

Which? compared the cost of warranties for products priced close to the amount that consumers spend on average in particular product categories, according to market data.

Rights of replies

Amazon said: “At Amazon, we’re always looking for ways to make customers’ lives easier. We offer warranties from third party insurers so customers can enjoy their purchases made on worry-free. For a small fee, those warranties provide our customers with additional cover over and above the statutory guarantee. That means if an accident happens, customers can get the help they need quickly.”

An AO spokesperson said: “We’re proud of the AO Care insurance product because it gives customers peace of mind that their essential electricals are protected with a plan that goes materially beyond basic manufacturer guarantees and consumer legislation. This is because it includes features like accidental damage cover, access to an accredited network of expert engineers who provide high quality repairs with the right parts and no hidden costs.

“AO Care is individually priced to the product, starting from £1.99 per month, fixed for at least three years and its protection features is what gives customers great value for money. It is an insurance policy, meaning customers can be confident knowing that their plan is regulated by the Financial Conduct Authority (FCA).

“We are always completely open with customers about what is and isn’t covered by AO Care so that they can choose whether to purchase additional protection. This includes asking if they have alternative cover in place for their electricals including checking if their home or contents policy covers wear and tear.”

Appliance City said: “At Appliance City, we offer the option of an extended warranty as we find that some customers do prefer to have the extra peace of mind. The majority of extended warranties are purchased online rather than over the phone or in the showroom.

“We also find that our extended warranties are taken out on larger appliances such as £2,000+ range cookers and induction hobs. Induction hobs can be more prone to accidental damage, this means taking out additional cover is much more beneficial for this type of appliance.

“Whilst the option to take out an extended warranty is available on all products, our approach to this isn’t a ‘hard sell’, we just make customers aware of the choice. When it comes to laundry we predominantly work with top brands including Samsung, LG, Fisher & Paykel who offer a five year manufacturer’s warranty on their appliances.”

A Currys spokesperson said: “We believe that our care plans offer value for money because they give customers the peace of mind that they will have the support they need when things go wrong. These plans also offer a range of supporting benefits such as 24/7 help, a 7 day repair promise, a replacement if an item can’t be repaired and extras such as an appliance valet service. It is not for us to comment or offer an opinion on the construct or relative value of someone else’s product. However, we do provide all of our customers with the key information required to determine if our extended warranty care plans are appropriate for their needs and periodically review the performance of our care plans to ensure they continue to meet expectations.”

A John Lewis spokesperson said: “Our extended warranties cover a wide range of faults, offer excellent value for money and guarantee high quality repairs or replacements. We already offer market leading breakdown guarantees and our Protect Plus adds to that offer, covering accidental damage that doesn’t carry an excess at the point of claim or any potential price hikes.”

A Sainsbury’s Bank spokesperson said: “Argos Care policies provide customers with peace of mind, offer excellent value for money and are hassle free. They are regulated financial products with cooling off periods which are designed to complement and extend the basic protections of a manufacturer guarantee and the consumer rights act.”

A spokesperson for Very said: “Our insurance policies are valued by many of our customers. Over the last six months, at least 96% of claims have been accepted, with an average repair time of five days where applicable.

“We are sorry to hear about Peter’s experience. As stated in our insurance policy for this item, the customer is covered for four years for accidental damage and two years for breakdown, with breakdown cover commencing following expiry of the manufacturer’s warranty period.  Cover for breakdown under the insurance policy comes into force following expiry of the manufacturer’s warranty period to ensure we are not providing cover that the customer already receives through the manufacturer. When the customer contacted us, they described what we believed to be a fault relating to breakdown and given this was within the two year manufacturer’s warranty, we referred them to the manufacturer.”

About Which?

Which? is the UK’s consumer champion, here to make life simpler, fairer and safer for everyone. Our research gets to the heart of consumer issues, our advice is impartial, and our rigorous product tests lead to expert recommendations. We’re the independent consumer voice that influences politicians and lawmakers, investigates, holds businesses to account and makes change happen. As an organisation we’re not for profit and all for making consumers more powerful.

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