Dick Smith and extended warranty loophole

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Reon

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#29721 16-Jan-2009 14:59

Hi

Just thought I'd share a friends experience with Dick Smith and an extended warranty.

He purchased a new Compaq desktop computer from Dick Smith around 2 years ago asking them before purchasing that he wanted an upgraded graphics card and memory and he wanted a extended 2 year warranty (so 3 years in total).

Recently the video card has failed and on contacting the providers of the extended warranty they said it was not covered as the extended warranty was only for the original boxed Compaq and did not cover the upgrades even though these were done by Dick Smith prior to purchase.

Obvioulsy this was not made clear to him at the time of purchase as he also made himself clear why he was purchasing the extended warranty as his last pc before that crapped out just after it's 1 year warranty ended and he wanted to cover himself.

Right or wrong I thought I'd just make other people aware of this situation.

Cheers
Reon

CYaBro

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#190018 16-Jan-2009 15:51

All extended warranties are a scam aren't they?

Under the CGA they should be covered anyway.

Opinions are my own and not the views of my employer.

tonyhughes

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#190023 16-Jan-2009 16:37

CYaBro: All extended warranties are a scam aren't they?

Under the CGA they should be covered anyway.

Not so.

CGA says goods should last for a reasonable length of time. This is very subjective, but heres some clear cut examples:

If you buy a $10,000 television, with a 1 year warranty, and it dies after 18 months - the CGA will cover you.
If you buy a $60 DVD player, with a 1 year warranty and it dies after 18 months, the CGA isnt going to do jack for you.

Not everything is that simple though.

But a video card.... after two years.... possibly. Whats it worth? $300? Then I'd say they should fix it.
$75? Not a sparrows fart chance of making a stink in a windstorm to get CGA rights applied.

heavenlywild

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#190032 16-Jan-2009 17:23

I wish the CGA could be a lot more clear-cut.

Say, a notebook PC between $800-$1000, should last at least 2 years. Up to $2000, it should last at least 3 years, etc.

Reon

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#190041 16-Jan-2009 18:52

Yeah because the CGA is not set in stone is why the extended warranty was purchased in this case.

I'd completely understand if he'd taken the pc back and got an upgraded card etc later on.

But for the shop to offer to do it when purchased and not include it in the extended warranty (or to at least make him aware of it) is pretty weak.

paradoxsm

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#190052 16-Jan-2009 20:37

Dse have recently changed the insurance system they have, Who was the company you dealt with? IUG? CIS?

Scenarios like this are often a reason for company decision to change the provider used. These insurances are often considered a "rip off" but sometimes for $50 they are better than trying to quote CGA and getting into arguments. Try and get the retailer to sweeten the insurance by dropping item base price and adding in some extras even if just consumables. and CHECK THE POLICY.

Is CGA fully dependent on price? I would have imagined they looked at usage and wear/tear and average expected life of an item. Grans DVD player has been used twice in two years yet mine runs constantly.
This could be interesting with my LED based projector, The non replaceable "lamp" life is quoted as 10,000 hours verus a normal bulb replaceable bulb type of around 650 Hours so if it fails I'd be curious to what the Insurance would cover on this if it failed again (had two failures under the orginal 1 yr warranty) (4 Yr DSE EXT warranty Totalguard)

Dratsab

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#190072 16-Jan-2009 23:06

If the customer has purchased the items and paid for an extended warranty in good faith then this needs to be honoured. If Dick Smith (via their agents) are not prepare to honour the warranty they accepted money for, they are liable to a remedial claim.

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Byrned

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#190562 19-Jan-2009 16:56

heavenly_wild: I wish the CGA could be a lot more clear-cut.

Say, a notebook PC between $800-$1000, should last at least 2 years. Up to $2000, it should last at least 3 years, etc.

Why not make it something simple like whatever the manufacturers warranty is and them consumers can choose to spend more on a quality brand which may or may not come with a longer warranty i.e. Asus with there 2 year warranty or HP business series with there 3yr warranty.

heavenlywild

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#190573 19-Jan-2009 17:43

Byrned:
heavenly_wild: I wish the CGA could be a lot more clear-cut.

Say, a notebook PC between $800-$1000, should last at least 2 years. Up to $2000, it should last at least 3 years, etc.

Why not make it something simple like whatever the manufacturers warranty is and them consumers can choose to spend more on a quality brand which may or may not come with a longer warranty i.e. Asus with there 2 year warranty or HP business series with there 3yr warranty.

However, a quality brand often doesn't have longer warranties - take Sony for example; a standard 1 year warranty.

eXDee

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#190577 19-Jan-2009 18:17

CYaBro: All extended warranties are a scam aren't they?

Under the CGA they should be covered anyway.

I used to think of it like that too, but for some people they are an advantage. Also as said they are more specified as what happens if something goes wrong.
Eg If you get an extended warranty on something from dse and it craps out, and is less than $400 value its simply replaced rather than going through the CGA's Repair then Replace idea (which is what most retailers choose).

Personally i don't mind kicking up a fuss about the CGA to get my way.

zaptor

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#190655 19-Jan-2009 22:29

Reon:

Recently the video card has failed and on contacting the providers of the extended warranty they said it was not covered ...

Yeah, you have to be careful about 3rd party warranty providers.

When they say it's just like extending the manufacturers warranty, believe me - it isn't. Genuine extended manufacturer warranties are far more valuable. Manufacturers actually replace the item with the same or (as is usually the case) better product. They virtually never refund the purchase price (or "depreciated" price as 3rd party warranty providers do). I've only ever had an actual manufacturer refund me once, and it was the original purchase price, and only after the 3 replacement parts all failed (!)

Deal with DSE directly. You're under no obligation to deal with the warranty provider - that is most definitely written into the CGA. I've brought lots of equipment from DSE with extended warrnties and the last time I had a claim it was an unpleasant experience. Although, in the end the DSE store agreed to sell the replacement item at the "depreciated" cost.

Buyer beware (or just get a proper manufacturer extended warranty if you're able).

Byrned

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#190764 20-Jan-2009 12:17

However, a quality brand often doesn't have longer warranties - take Sony for example; a standard 1 year warranty.

In which case you could vote with your feet - figuratively of ocurse. I'm nout suggesting kicking them or anything!

Realistically I can't see any other way of being more spcific with the CGA unless they actually name every item sold in NZ and say this is how long we believe it should last - in which case compliance cost goes through the roof. Far easier to go with what the mfr states and at least its black and white, and everyone knows where they stand.

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bazzer

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#190781 20-Jan-2009 13:25

In that case, why not scrap it? You've got the manufacturer's warranty to back you up, you don't need the CGA...

zaptor

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#190793 20-Jan-2009 13:53

bazzer: In that case, why not scrap it? You've got the manufacturer's warranty to back you up, you don't need the CGA...

Most manufacturers don't deal with Joe Public. The reseller does.

Without the CGA it makes it rather costly to force a retailers hand in honouring a warranty if they don't want to.

I almost never quote the CGA. Mind you I try to never deal with dodgy resellers.

paradoxsm

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#190937 21-Jan-2009 00:48

I still think there should be a "common usage sense prevails" approach to CGA/warranties.

I have witnessed many customers coming in to shops and screaming CGA and it looks like they have used the phone to hammer in nails, the PC as a sawdust extractor, or thrashed the $29.99 milkshake maker in a cafe for 6 months then want them replaced.

Just from my casual customer observations (I don't work in retail), it appears to be abused and mostly abused by a lot of the not-so-genuine "chip on their shoulder" cases rather than the "old lady who played two DVD discs in her DVD player before it went dead".

Agreed with not dealing with dodgy retailers, I strongly suggest dealing with one whom offers a 7 day "money back" as my own experience has found they are much better to deal with if/when things go wrong.

For reference, here is that generic REFUND POLICY SIGN that many retailers display and Consumer Guarntees Act, if you see that, it's a good bet they don't give "change of mind" refunds. You still have the "oversold" not fit for purpose" avenues however it may not be an easy path taken, Do check the retailer offers an exchange policy howver, I have been burnt by this once before especially for an identical item that might be different colour/size (white cordless instead of black, 32 trousers instead of 34 for example)