5 Warranty Myths That Big Retailers Don’t Want You To Know About

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5 Warranty Myths That Big Retailers Don't Want You To Know AboutDuring the pandemic, many people are doing more of their shopping online. One of the frequently encountered situations in online shopping is that retailers try to upsell people on retail warranties. There are a lot of warranty myths out there you might be aware of, so we’re here to set the record straight.

It probably feels like every time you shop online when you get to the checkout page, the company is trying to get you to buy a warranty. This is especially common for big box stores and big-ticket purchases like appliances and electronics. But it can also happen with items worth smaller dollar amounts. Even if you spend as little as $100 on a product, the retailer will likely ask if you want to pay $20-30 extra for a warranty or “protection plan.”

Are these extra costs really worth it? Or is the retail warranty just a way for corporations to pad their profit margins?

Understanding the warranty myths and realities can help you be a savvier shopper, save money, and avoid getting stuck with an “unwarranted” warranty.

What are retail warranties?

Retail warranties are also sometimes called extended warranties or “protection plans.” They are a form of insurance that a buyer can purchase to help cover the costs of repairing an item in case it breaks during a certain period of time.

The promise of warranties is this: if your product breaks, you can get it fixed. Or sometimes get a new one.

Anyone who’s ever dropped and cracked their expensive iPhone will understand the feeling of relief that comes from realizing that your phone is still fully covered under warranty if you have a protection plan like AppleCare.

The same is true for fitness equipment, which has experienced a boom since COVID-19: if your treadmill breaks down while it’s still under warranty, this can potentially save you hundreds of dollars in costs.

But here’s the problem: a lot of big box retailers are pushing customers to buy overinflated warranties now on all kinds of products. And these retail warranties often are not a very good deal for you as a consumer.   

If you’re not careful, you might end up in a situation where you’re paying too much for a warranty that won’t really help you if something breaks.

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Weight the pros and cons

On one hand, it’s good for consumers to be risk-conscious and want to be protected against the possible costs of repairing or replacing a faulty item. Sometimes peace of mind can be priceless.

But many retail warranties usually do not add enough value to be worth the cost. Budget-conscious millennials might want to avoid the extra costs of retail warranties. 

Not all retail warranties are worth paying for, and not all warranties are the same. Don’t just buy a retail warranty because it’s being presented to you as an easy add-on option at the checkout.

Instead, if you take a closer look at how retail warranties really work, you can get more value for your money and understand your options.

Let’s take a closer look at how retail warranties can work for you. Or, how to avoid an unnecessary upsell that doesn’t really make financial sense.

Myth 1: You have to buy a warranty at the point of purchase.

Reality: Warranties are great money makers for retailers, which is why consumers often get hit hard and fast with the sales pitch at the cash register. What the salesperson doesn’t tell you is that you can actually shop around for a product protection plan instead of buying a warranty at the point of purchase.

It’s sort of a dirty little secret in the retail business—warranties are the store’s bread and butter.

With nearly universal online price transparency (thanks, Amazon!), margins at big retailers have been shaved to a minimum, forcing warranties and other auxiliary products and services to become their new profit centers.

Fortunately, however, if you adopt a “don’t take the bait and wait” mindset, you can actually find much better deals to protect those big-ticket purchases.

Consider a new company called Upsie, for examplea modern warranty company that is onto something big. In contrast to retailers like Best Buy and Apple, Upsie is a more affordable warranty option for your electronic devices, appliances, and fitness equipment. By cutting out the middle-man and making the entire process simple, accessible, and transparent online, Upsie can offer millennials significant savings on warranties—up to 70% less than retailers and smartphone carriers like Apple.

Bottom Line

Don’t rush the process on finding a good protection plan. When you buy expensive products, avoid the pressure at the register and take your time to find the right warranty plan. Upsie gives you 60 days to 11 months after purchase of a new or used device, product, or appliance.

Myth 2: You are out of luck when you buy refurbished or used products.

Reality: Savvy deal seekers do not have to give up warranty protection. You may still have option to cover your used or refurbished device. In economic hard times like now, it can be a smart money move to buy used or refurbished, and doing so does not mean that you have to give up the peace of mind that comes with warranty coverage.

For example, instead of shelling out a long-term payment plan for a brand-new smartphone, laptop, or fitness machine, opt for a used or refurbished model that can provide you hundreds of dollars in savings.

Before you buy used, however, it is important to understand the difference between used and refurbished.

Used vs. Refurbished

A used electronics device is essentially being sold as is. It generally is the responsibility of the seller to provide images of the device so you can see if it has any scratches or cosmetic issues. The listing should also say if there’s a feature that doesn’t work, like a cracked screen or foggy front-facing camera.

A refurbished device, on the other hand, has gone through diagnostic tests to make sure it meets the standards of sellable conditions. In some cases, these might be returned phones, laptops, treadmills, etc. that were broken and have been repaired. An additional factory-refurbished warranty might be included, depending on where you get it.

However, regardless of whether you take the “used” or “refurbished” purchase route, make sure you find a warranty to get the maximum value out of your electronic product/device. The best warranties to look for are ones that include accidental damage coverage for things like coffee spills or summer pool mishaps on top of manufacturer protections.   

Bottom line

Don’t assume that you cannot purchase a warranty for a used or refurbished product. There are great options available that are wallet-friendly while giving you much-needed peace of mind.

Myth 3: Everything is covered in my warranty.

Reality: Many people assume that a warranty is like an all-inclusive resort. However, not everything is not covered.

Most warranties are full of loopholes and exclusions that can keep you from getting your money back. There’s not a lot of transparency from retailers about what is included (or not) in your warranty.

According to Consumer Reports, you need to read the fine print before you buy a warranty. The coverage might not be as generous as you expected. Warranties often will not cover accidental damage, for example. Or they will not cover repairs for customers who do not do routine maintenance on their products.

Some warranties might also require you to pay a deductible or share the costs of repairs.

Bottom line

Look for a warranty that’s up front about what’s covered and is easy to understand.

Myth 4: Filing a warranty claim is easy.

Reality: Today, we are accustomed to handling things fast. However, filing a warranty claim is often a frustrating, arduous task. Retailers make the process very difficult for consumers.

To start, you need to save all your paperwork. Then, you have to get approved for warranty-covered repairs. Even after that, though, there are still ways that this situation can be difficult:

  • Requiring paper instead of digital documents. Hello, 1980!
  • Offering limited locations for repairs.
  • Needing to part with your device.
  • Waiting for repairs, leaving you stuck with a faulty device for several days.
  • The quality of the repairs makes you want to hit the undo button. According to Consumer Reports, 1 in 5 people are not satisfied with their repairs under an extended warranty.

Bottom line

Retailers don’t make it easy for customers to get help from their warranties. Instead of buying a warranty from a retailer, you might be better off just saving the money and hiring your own repair person or asking a handy friend for help. Or, look for newer, alternative options.

Myth 5: The only way to buy a warranty is from the retailer.

Reality: You do not have to buy your warranty from the retailer where you purchased your product. You have other options when deciding whether to buy a warranty.

We’ve all been there. The salespeople know just how to put the pressure on you to sign up for the extended warranty—especially at the point of purchase.

Don’t do it! You don’t have to sign up for the big box retailer’s warranty. Nor do you have to purchase a warranty from an online retailer on the day you purchase the product. You have other options!

Option 1

Your credit card might offer a built-in warranty. Some credit card companies will give you built-in extended warranties for free if you use their card to buy certain products. Check the fine print on your cardholder agreement.

But beware that credit card companies do not have a service level agreement on repairs, and many consumers have reported difficulties getting service. Also, be aware that the credit card extends the manufacturer warranty that rarely includes any accidental damage coverage.

Option 2

Use apps to get a lower-cost warranty. Upsie offers lower-cost extended warranties on products like TVs, laptops, iPhones, and more. The best part is they will even tell you if you shouldn’t buy a warranty; if a warranty isn’t a good deal or the right fit for your latest purchase, they will tell you honestly. 


Big box retailers are making big profits off of warranties. But don’t fall for the warranty myths. Know the facts and make a well-informed decision. And if you want to buy some additional protection for your latest big purchase, check out new alternatives like Upsie to get lower prices and better transparency on how the warranties work, and whether or not a warranty is the right decision for you.

5 Warranty Myths That Big Retailers Don't Want You To Know About

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