Let's Talk Warranties

Warranties or guarantees can be a source of confusion for consumers. This is because it is often difficult to tell just what measures the period of coverage. "Lifetime" can be used in at least three ways. For example, a warrantor of an auto muffler may intend his "lifetime" warranty's duration to be for the life of the car on which the muffler is installed. In this case, the muffler warranty would be transferable to subsequent owners of the car and would remain in effect throughout the car's useful life.

Or the warrantor of the muffler might intend a "lifetime" warranty to last as long as the original purchaser of the muffler owns the car on which the muffler is installed. Although commonly used, this is an inaccurate application of the term "lifetime."

Finally, "lifetime" can be used to describe a warranty that lasts as long as the original purchaser of the product lives. This is probably the least common usage of the term.

The Guides advise that to avoid confusing consumers about the duration of a "lifetime" warranty or guarantee, ads should tell consumers which "life" measures the warranty's duration In that way, consumers will know which meaning of the term "lifetime" you intend.

Basic Information Required for All Warranties
Under the FTC's Disclosure Rule, there are several basic aspects of coverage that a warranty must describe. It is useful to think of these as several questions, which a warranty must answer:
1. What does the warranty cover/not cover? Answering this question is quite simple and should clearly describe the scope of coverage.

2. What is the period of coverage? If coverage begins at some point in time other than the purchase date, your warranty must state the time or event that begins the coverage. Also, it must make it clear when coverage ends if some particular event would terminate it.

3. What will they do to correct problems? This requires an explanation of the remedy you offer under the warranty. This could be repair or replacement of the product, a refund of the purchase price, or a credit toward subsequent purchases.

4. How can the customer get warranty service? Your warranty should tell you who to go to for warranty service and how to reach those persons or companies. This means that the warranty needs to include the name and address of the company, and any person or office you should contact.

Questions to ask
• What parts and repairs are covered by the warranty?

• Are any expenses excluded from coverage? (Some warranties require you to pay for labor charges.)

• How long does the warranty last?

• What will the company do if the product fails? Will the company repair it, replace it or return your money?

• Does the warranty cover "consequential damages?" (Most do not. This means the company will not pay for any damage the product caused or your time and expense in getting the damage repaired.)

• Are there conditions or limitations on the warranty? (Some warranties only provide coverage if you maintain or use a product as directed.)

Spoken warranties
Sometimes a salesperson will make an oral promise.. Have the salespersons put the promise in writing, or do not count on the service.

To Minimize Problems

• Read the warranty before you buy.
• Consider the reputation of the company offering the warranty. Look for an address to write to or a phone number to call if you have questions or problems. If you're not familiar with the company, ask your local or state consumer protection office or Better Business Bureau if they have any complaints against the company. A warranty is only as good as the company that stands behind it.
• Save your receipt and file it with the warranty. You may need it to document the date of your purchase or prove that you're the original owner in the case of a nontransferable warranty.
• Perform required maintenance and inspections.
• Use the product according to the manufacturer's instructions. Abuse or misuse may void your warranty coverage

SOURCE
Federal Trade Commission - Consumer Response Center - Washington, D.C.
http://www.ftc.gov