Once again, a news agency has decided to regurgitate Consumer Reports in opinions that buying Extended Service Plans is not a good investment. This is not new nor is it news. I am amazed it showed up on my favorite Sunday Morning show on CBS.
Here is what I say…..Extended Service plans can be an unnecessary investment…..They can be a fabulous investment. Duh. If your product breaks and you get it repaired or replaced then that is a good investment. No argument. On the flip side, even if you do not use the extended plan, (meaning the product actually doesn't fail), you still have the peace of mind knowing that if it were to fail you would not be out any more money or inconvenience….That is really the message they miss…..convenience, time saving and peace of mind. It is not all about simple dollars and sense. In fact if it was, they way it works is the risk is spread out amongst those that do invest in the coverage and they pay very little for a lot.
Yes, there are bad companies that hide behind fine print and take the money and run, but overall, the industry is driven through retail and manufacturing and neither of those “Branded” industries can afford to tell people no. They have their eyes open for you. Their mission is to build brand and reputation and extended plans help them do that….
Here are just a few things that many people are happy to own ESP or other creative coverage upon:
- Accidental Damage on Wireless, power tools and laptop type products.
- Loss of Job coverage on Autos.
- Weather damage coverage rolled into warranties on things like RV awnings and Covers.
- Simple over the counter replacement plans on inexpensive items that likely have short life span. These are super convenient and very popular….
I could go on, but it doesn’t take a rocket scientist to know that if your product has no moving parts and is in a controlled environment that the likelihood of using the ESP is slim, but I am tired of News that is no News and does not reflect the other side of the story.
