Definition

An extra layer of coverage for repairs or service costs on items you use. It helps manage unexpected expenses without a big hit to your wallet.

What to consider

  • Review the length of the extended warranty.
  • Understand which components are covered.
  • Consider the cost versus potential repair expenses.

Real world scenarios

  • An electronics store offered a warranty extension on new gadgets beyond the manufacturer’s warranty.
  • A homeowner purchased an extended warranty for major appliances.
  • A car dealership provided a warranty extension option for new vehicles.

Related terms

Insurance & Financial Protection