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Timely reminder for Christmas shopping – don’t fall for warranty shams this Christmas

You are at the store and have finally made a decision on that fabulous new bit of technology whether it’s a new iPad, big screen TV or fridge. You’re just about to hand over your hard earned $$$ when the salesperson offers you the “Extended Warranty”

You’ve already made a bunch of decisions but what to do? You don’t want to have any trouble with your shiny new toy and it’s already a sizable investment – maybe it’s best to pay a little more just in case something goes wrong.

But… do you really need it??

Don't be fooled by Warranty Scams

Don’t be fooled by warranty scams that may offer little more than what you are already entitled to as a consumer.

Australian consumers are automatically entitled to certain warranties (which are called “guarantees”) for goods or services purchased.

Under the Australian Consumer Law, goods that are sold, hired or leased, and services, have certain warranties attached.  They apply automatically, regardless of whether or not a warranty or extended warranty was purchased by the consumer.

Consumer protection agencies are warning consumers to be aware of warranties or extended warranties being offered, which sell little more than the rights already enjoyed by consumers under the Australian Consumer Law.

This becomes an issue when companies attempt to profit from uninformed consumers, and sell them rights they already have under Australian Consumer Law.

9 Specific Guarantees that Apply to all Goods Sold in Australia

There are nine specific guarantees that automatically apply to the sale of goods in Australia.  Among them, is the guarantee that goods purchased: are of acceptable quality, that they are reasonably fit for the purpose specified, and will last a reasonable time.  Goods must be:-

  • fit for the purposes for which goods of that kind are commonly supplied;
  • acceptable in appearance and finish (no scratches or other appearance defects);
  • free from other defects;
  • safe;
  • durable and lasting – the goods must function for a reasonable time after purchase depending on the cost and quality of the product.  A reasonably expected time that a cheap appliance may last, may not be as long as the reasonably expected time that a more expensive product will last; and
  • match advertising and product descriptions.

Ben and his dream $6000 Stereo

Ben had been dreaming about getting a new stereo for ages. Finally he had the $6000 saved up and welcomed home his new prize. After a couple of years of wonderful music – the system stopped working.

Ben went back to the store to sort out a repair only to be told “The stereo only has a 12 month warranty – it’s not our problem. You should have bought an extended warranty”.

Understandably Ben was upset. Being a resourceful kind of guy, he researched his options and found that in fact he was entitled to have his prize stereo repaired, replaced or refunded as it was reasonable to expect more than 2 years use out of a $6000 stereo.

For more information on your rights as a consumer and the automatic guarantees that apply to the purchase of goods, see here.