Extended Warratty vs Insurance

[SSteve]

Howdy,

We've just made the deal on our M/H and are now going through the trials of figuring out the "Back End" (yeah, we read JD's book).

We've done a lot of searching on this site and others to try and learn from some real user experience on this conundrum. Here comes our rant.

While looking into the coverage from a number of providers, one place says the coverage is insurance while another says it's a warranty. Seems like semantics, but is there really a difference?

We're quite concerned about the apparent discrepancy between what the covering firm "offers" and what they actually "deliver". Some customers say you must be completely aware of the offer and know exactly how to file a claim. Others say they believed in what was sold to them, but through experience have found you can be denied compensation for the most trivial reason--even no reason at all.

Some say the piece-of-mind is worth the cost--regardless of the grief involved in a claim. Some say bank your money and pay-as-you-go and avoid that grief all together.

Holy crap! We don't know what to do!

The only consensus is that it's an utter gamble. OK. That's what insurance is all about. Well, such is life and we can deal with that. But, to us, a warranty is a promise of performance to back the product. It means the dudes and dudettes selling the widget stand behind what they say it will do and, for as long as they say it will. Insurance (in this case) is a promise to step in when that promise fails. Our problem is, it looks like we need both!

Obiwan, please help!

[SSteve]

Howdy,

We've just made the deal on our M/H and are now going through the trials of figuring out the "Back End" (yeah, we read JD's book).

We've done a lot of searching on this site and others to try and learn from some real user experience on this conundrum. Here comes our rant.

While looking into the coverage from a number of providers, one place says the coverage is insurance while another says it's a warranty. Seems like semantics, but is there really a difference?

We're quite concerned about the apparent discrepancy between what the covering firm "offers" and what they actually "deliver". Some customers say you must be completely aware of the offer and know exactly how to file a claim. Others say they believed in what was sold to them, but through experience have found you can be denied compensation for the most trivial reason--even no reason at all.

Some say the piece-of-mind is worth the cost--regardless of the grief involved in a claim. Some say bank your money and pay-as-you-go and avoid that grief all together.

Holy crap! We don't know what to do!

The only consensus is that it's an utter gamble. OK. That's what insurance is all about. Well, such is life and we can deal with that. But, to us, a warranty is a promise of performance to back the product. It means the dudes and dudettes selling the widget stand behind what they say it will do and, for as long as they say it will. Insurance (in this case) is a promise to step in when that promise fails. Our problem is, it looks like we need both!

Obiwan, please help!

[hamdave]

I have read a lot about this also, but mine is an older rig, and I have decided to 'bank' the money and pay and/or DIY method. so far so good for me.

best of luck in your choice,

cheers

[wazone2]

I have never and will never buy an extended warranty, insurance, or whatever they call it. It is a lose-lose-lose proposition. I've owned motorhomes, boats, cars, etc. for many years. I'm many, many thousands of dollars ahead by not participating in those products. That said, many people buy them as it allows them to sleep better. Some say they've received more than their payment, that may be true but as a group they have to lose because these products are one of the most profitable products in the manufacturing industry. The aggregate payments have to cover-dealer's commission, service provider's profit, sales expenses, administrative expense, etc.

[RV Wizard]

SSteve, did you deal on a new MH? If so you will have a warranty from the various manufacturers of the coach and components. You may not need any additional coverage once you get the bugs worked out.
If not you may want to purchase some type of coverage. Read and unbderstand what is and most importantly what is NOT covered under the plan.

[paz]

There was a recent story on the TV about how to save money in these difficult economic times. They stated stores like Best Buy and Circuit City frequently have better prices on electronics than Sam's Club and Costco. The reasion: Best Buy and Circuit City have lower profit margins on the electronic devices because they make most of their profit on the extended warranty. Sam's Club and Costco don't sell extended warranties and therefore must make more profit on the items themselves. What does that tell you about extended warranties?

If you do decide to go with an extended warranty, do what RV Wizard says. Read and understand what is covered and what is not covered and understand all the requirements of how to make a claim. The company providing the extended warranty makes less money off you if they have to pay a claim so they will be looking for excuses not to pay.

[RustyJC]

Whether it's extended warranties or insurance, either is a bet. The company selling the product is betting that the premium pool plus its investment returns will exceed what it has to pay out. The buyer is betting that his/her claims will exceed the price paid for the coverage. Just like Las Vegas - the odds are always with the house. Some people may win, but most will lose.

If one is financially able to self-insure to carry his/her own risk instead of paying someone else to assume it, he/she would be better off to take the money paid for the premium and set it aside in an investment. Of those who do so, more would come out ahead than behind.

Rusty

[Jo/Lee]

<BLOCKQUOTE class="ip-ubbcode-quote"><div class="ip-ubbcode-quote-title">quote:</div><div class="ip-ubbcode-quote-content">Sam's Club and Costco don't sell extended warranties and therefore must make more profit on the items themselves. What does that tell you about extended warranties </div></BLOCKQUOTE>

Good Sam DOES sell extended warrantys.

Lee

[RustyJC]

<BLOCKQUOTE class="ip-ubbcode-quote"><div class="ip-ubbcode-quote-title">quote:</div><div class="ip-ubbcode-quote-content">Originally posted by Jo/Lee:
Good Sam DOES sell extended warrantys.

Lee </div></BLOCKQUOTE>
Are you referring to their CSP (Continuing Service Plan)? I would highly recommend that one reads all the fine print regarding what is required to keep the coverage in effect.

Rusty

[golden]

I guess I must be the only one who has an extended warranty that has done what it says it would. I have the kind that tells you what it WON'T cover. I've had occasion to use it three separate times and they have paid each time without delay. As long as you conform to the instructions of the plan you use, there should be no problem.

[LindaH]

<BLOCKQUOTE class="ip-ubbcode-quote"><div class="ip-ubbcode-quote-title">quote:</div><div class="ip-ubbcode-quote-content">Originally posted by Jo/Lee:
<BLOCKQUOTE class="ip-ubbcode-quote"><div class="ip-ubbcode-quote-title">quote:</div><div class="ip-ubbcode-quote-content">Sam's Club and Costco don't sell extended warranties and therefore must make more profit on the items themselves. What does that tell you about extended warranties </div></BLOCKQUOTE>

Good Sam DOES sell extended warrantys.

Lee </div></BLOCKQUOTE>
Yes, Good Sam has their CSP plan. However, the Sam's Club referred to above is NOT Good Sam -- it's the warehouse club similar to Costco.

[Gary RVRoamer]

golden...my extended warranty experience is like yours. I've had two with multiple claims on each and both paid everything asked of it and promptly too. Usually direct to the repair shop by credit card, but once the shop asked to be paid direct by me, so I got a reimbursement check from the warranty company. That came in less than 10 days too.

So I have no complaints at all. ON the other hand, I still think you are better off self-insuring if you can afford to cover a major repair. We are retired and with our ever dwindling assets we no longer feel we can afford to risk the principal of our savings, so now we buy the service plans.

[historyljc]

<BLOCKQUOTE class="ip-ubbcode-quote"><div class="ip-ubbcode-quote-title">quote:</div><div class="ip-ubbcode-quote-content">. . . I still think you are better off self-insuring if you can afford to cover a major repair. We are retired and with our ever dwindling assets we no longer feel we can afford to risk the principal of our savings, so now we buy the service plans. </div></BLOCKQUOTE>
Gary pretty much sums it up for us. We have it, haven't had to use it, don't want to use it.

[Jo/Lee]

<BLOCKQUOTE class="ip-ubbcode-quote"><div class="ip-ubbcode-quote-title">quote:</div><div class="ip-ubbcode-quote-content">Good Sam DOES sell extended warrantys.

Lee

Yes, Good Sam has their CSP plan. However, the Sam's Club referred to above is NOT Good Sam -- it's the warehouse club similar to Costco. </div></BLOCKQUOTE>
DUH!!!!!
I knew that!!! Why I wrote Good Sam when I meant Sam's Club I'll never know.
One thing about me is when I screw up it's usually a really dumb screw up.
Sorry to all

Lee