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7 out of 10 people wrongly believe buying an extended warranty provides extra protections

CHOICE reveals top tips on using your consumer rights.

Last updated: 02 August 2023

New research from CHOICE has revealed 7 out of 10 Australians wrongly believe purchasing an extended warranty gives them extra protections beyond their rights under the Australian Consumer Law (ACL). 

The nationally representative survey also found: 

  • Almost a third (32%) of Australians have bought an extended warranty in the past two years.
  • For people who purchased an extended warranty in-store, only 12% reported hearing about how it differs from the ACL.
  • 68% of people wrongly believe that extended warranties provide more protection beyond the ACL.
  • Seven in 10 (70%) thought they wouldn't be able to receive a refund, repair or replacement for a faulty product once the manufacturer's warranty expires.

"In most cases, extended warranties aren't worth purchasing. If your product becomes faulty or does not work, you will likely be covered for a repair, replacement or refund under the ACL," says CHOICE Head of Policy and Government Relations, Patrick Veyret. 

"Most extended warranties are offered for a period of around two or three years from the date of purchase. In most cases, consumers will already be covered under the ACL during this period if something goes wrong," says Veyret. 

"Our research also found 72% of respondents who claimed an extended warranty did so when the product was less than two years old, which shows businesses are selling people rights they already have for free under the ACL," says Veyret. 

Here are CHOICE's top tips to help you use your consumer rights:

1. Know your rights 

"Getting familiar with your consumer rights will give you the confidence to access them when something goes wrong. If your product breaks or doesn't work properly, you should be able to get a refund, replacement or repair, depending on whether it's a major or minor fault and how old the product is," says Veyret. 

2. Don't pay for rights you already have

"The ACL was created to provide consumer guarantees for products you buy. These guarantees apply even if the warranty states otherwise. So, if you feel pressure to purchase an extended warranty, ask the salesperson, 'What protection does this give me beyond the ACL?" says Veyret. 

3. Keep your receipts 

"Having a record of your purchases is important, especially for high-value products. Companies and manufacturers need proof of your purchase to provide your consumer rights. If you lose your receipt, you can also use credit or debit card statements," says Veyret. 

4. If something goes wrong, contact the company

"If your product is faulty, contact the company you purchased from straight away. If they refuse to help, send them an email explaining your rights under Australian consumer law. You can also contact your state fair trading agency, or report it to the ACCC if there's a safety issue, " says Veyret. 

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