Guarantees and warranties – worth the paper they’re written on?

You’ve just bought a brand new flat screen ultra-high-definition television and you’re very excited. So excited that you put aside the warranty that comes with it, which tells you that your super-sleek TV is guaranteed for a year.

The retailer told you that you could pay a little extra to get an extended five-year warranty, but you didn’t worry about that. You’ve already spent $1800 on this beauty.

Fast forward 15 months, and one evening you crash in the couch after a long day at work. Looking forward to an evening of relaxation you press the TV remote’s ‘on’ button but nothing happens. Several attempts to get it going fail. Your top-quality TV is dead.

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After overcoming the disappointment, you set about doing something about it. If you’re anything like me, you’ll wonder where it was that you filed that warranty paperwork, and spend a couple of hours searching for it.

Finally, you track it down, only to discover that your you-beaut piece of equipment was only covered for 12 months. Surely the retailer will do the right thing, though, won’t they? TVs should last longer than a year.

The next day you ring the retailer. They are polite but remind you that you had the option if purchasing an extended warranty and chose not to do so. “I’m sorry, but we can’t help you.”

Is that correct? After all, it’s all there in black and white on the paperwork you put away the day you bought your telly.

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In fact, it is not correct. Under Australian Consumer Law (ACL), you have rights that can extend beyond what’s written on a warranty. Under the ACL electrical and whitegoods industry guide, an example such as this is provided:

“A reasonable consumer would expect to get more than two years’ use from a $1800 television. Under the consumer guarantees, the consumer therefore has a statutory right to a remedy on the basis that the television is not of acceptable quality. The supplier must provide a remedy free of charge.”

So in this case, it definitely would be worth your while to challenge the retailer’s claim that there’s nothing they can do to help you.

Warranties and extended warranties provided by a manufacturer and/or retailer come in addition to, and do not replace, the consumer guarantees provided to you under ACL.

ACL generally provides Australians with more protection than they might think. Take the Apple iPhone for example. Apple provides you with a one-year guarantee on the device, but if you purchased your phone via a 24-month mobile phone plan, as many Australians do, the law says you can reasonably expect the phone to work for that two-year period.

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Of course, there can be grey areas, such as defining ‘reasonably’. The ACL also provides for differences between minor and major faults. If a fault is deemed to be ‘minor’, the decision on how the matter is dealt with (e.g., repair, refund or replacement) is the domain of the manufacturer. But if the item has a ‘major’ fault, the consumer can make that decision.

Manufacturers will also sometimes provide what are known as express warranties. These provide a specific guarantee such as a minimum of five years of serviceable use, or a promise that a product “will not rust”.

Any such express promises made form part of a consumer guarantee under Australian law.

There are a couple of lessons to be learnt here. First, regardless of what that piece of paper marked ‘warranty’ or ‘guarantee’ says, you may still be covered beyond its parameters and second, set aside a spot at home for your warranty paperwork so you don’t have to spend hours tracking it down.

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Written by Andrew Gigacz

Andrew has developed knowledge of the retirement landscape, including retirement income and government entitlements, as well as issues affecting older Australians moving into or living in retirement. He's an accomplished writer with a passion for health and human stories.

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