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Why protection plans are usually not worth it

Apple Wallet iPhone
Posted at 5:00 AM, Jun 02, 2022
and last updated 2022-06-03 16:38:34-04

PHOENIX — If you're shopping for cars, appliances, or even sports equipment, you'll typically be asked to buy an extended warranty or protection plan.

You may think that if you're paying $400 for a new laptop, why not shell out another $60 or $90 to protect it?

But Ken Colburn with Data Doctors says, for the most part, it's a waste of your money.

They're called protection plans or extended warranties.

They can be alluring by promising that you will pay zero dollars for repairs.

Colburn says many times, that plans only pay for hardware issues, not what causes most issues like viruses.

"If anyone hits you with ransomware, any of that type of thing that's not going be covered by your warranty," Colburn said.

Your device may not have a record of breaking down within the warranty's time period.

A few years ago, a Consumer Reports survey of more than 36,000 laptop owners showed of people who bought a protection plan,15% used it to pay for repairs.

The survey also found the median cost for a repair was just $3 more than the cost of the plan.

"So you're just paying for something you'll never use," Colburn stated.

He does recommend one protection plan. If you have an Apple device, Colburn says it might be worth buying their plan and not because it's great.

"It's because Apple has basically done everything they can to make it virtually impossible for anybody other than them to fix," he added.

If you're considering an extended plan check the repair history of your device model.

Also, read the plan thoroughly. If you drop or spill, will it be covered?

Learn more about extended product warranties.

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