Extended warranties

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  • Updated:12 Nov 2008
 

05.Megan Watson's story

Megan WatsonIn October 2005, Megan Watson bought a front-loading washing machine from Harvey Norman. She elected to buy an extended warranty for $50. She was told this, combined with the manufacturer’s warranty of two years, would give her cover for seven years.

In January this year when the manufacturer’s warranty had expired, the machine started vibrating badly. Megan contacted the extended warranty company to have it fixed. After three weeks of chasing both the warranty company and the repairer, thanks to a communication problem between the two parties, the machine was repaired, returned and installed.

Within a week water leaked onto the floor and there were problems with the controls. When Megan contacted her warranty company she was shocked to hear she had only $470 left on her extended warranty, which wouldn’t be enough for the current problem.

Megan hadn’t checked the fine print when buying the extended warranty, which stated that it would only cover the cost of repairs equal to the cost of the machine — $1295. The first round of repairs had cost $825, including a $110 quote fee. Megan says she is now stuck with a very expensive washing machine, which is malfunctioning after less than three years and she would be very unlikely to buy an extended warranty again. “The frustrating thing is that they keenly sell you the warranty but don’t spell out its limitations. Now I have a machine that is unreliable — and no money left to fix it.”

Megan is currently pursuing the issue with the NSW Office of Fair Trading and hopes she might have some success using her statutory rights. We’ll keep you updated on her progress.
 

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