Extended Warranties On Electronics: Are They Worth It?

CHICAGO (CBS) - As you tackle your holiday shopping, store personnel will likely bombard you with offers of extended warranties on electronic purchases. But are they worth the money? CBS 2's Mary Kay Kleist reports.

David Adams bought a printer and the extended warranty for it, but less than six months after buying it, the printer broke and Adams says the warranty's promise was broken as well.

"When I went in to try and return the printer after one manager had told me I could, another manager said he would not return it and give me my money back," Adams said.

Most electronics on the market come with a manufacturer's warranty. Stores often offer an extended warranty at a cost to the consumer. When is it wise to buy that?

Best Buy employee Raj Sharan said, "Products that we travel with, like iPods, laptops, cell phones, these are devices that have a much higher rate of being dropped or stepped on."

Educate yourself before you purchase a warranty. Call the product's manufacturer to see if the company is aware of the third party offering the extended warranty.

Understand the warranty before purchasing.

"Realize what it covers and what it doesn't," said Sharan.

Read the warranty yourself.

"Don't believe what the salesman tells you when they're giving you information to get you to buy the warranty," said Adams.

Check out the warranty company with the Better Business Bureau to see if there have been complaints filed.

Finally, evaluate the cost of the warranty versus the risk of damage or loss.

These warranty deals can sound too good to be true, and often that's the case.

The single biggest problem on warranties is that the fine print is long, detailed and tedious to read; which means we often buy the warranty without knowing what it really covers.

David Adams has now launched a website to educate consumers on warranty fraud. For more information, click here.