When considering a TV extended warranty, there are a number of considerations you should keep in mind to ensure you choose a warranty that is effective and legitimate. If you are considering a third party extended warranty, then you should look at the terms and conditions of the warranty to ensure it provides you with the protection you want. There are also some particular terms you should look for and avoid in a TV extended warranty, such as a depreciated value buyout and any unusual termination clauses.
A TV extended warranty is a type of insurance that can be purchased for a television, usually from a company other than the TV manufacturer. One of the first things you should consider is the length of time covered in the warranty and how it overlaps with any manufacturer’s warranty. Most extended warranties begin at the time of purchase, which means that a three-year extended warranty on a TV with a one-year manufacturer’s warranty only protects you for two years in addition to the manufacturer’s warranty. While the two warranties overlap, you may receive improved protection through the extended warranty, but this is not always the case.
In general, you should pay at most about 20% of the value of your TV for a TV extended warranty, though most legitimate warranties are closer to 10% or 15%. You should also look at exactly what is covered under the TV extended warranty, including bulb replacement for rear projection TVs. This is likely to be the most common repair or replacement you need for such a TV, so a warranty without this replacement may be worthless. If your TV is mounted in your home, then you should look for a warranty that provides in-home service, unless you want to deal with shipping or transporting your TV to a repair center.
You should also look for a TV extended warranty that provides work from an authorized service center, as this typically provides greater protection. There are certain terms found in some extended warranties that can have a tremendous impact on any actual service provided by a company. You should avoid a TV extended warranty that includes a depreciated value buyout clause, or unusual termination or dump clauses.
Depreciated value buyout means that the company that issues a warranty can, at time of service, pay you replacement costs based on the “current” value of the television. This means that if you buy a TV for $3,000 US Dollars (USD), and two years later the warranty provides you with replacement costs, the issuer of the warranty can decide the TV is worth only $1,000 USD at the time of service and pay out that amount rather than the initial cost. Similarly, some warranties include dump clauses or termination clauses that allow the issuer to end the service agreement prematurely, even at time of service, and only pay out a depreciated value at the time of termination.