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Posted by Stan Brown on 02/02/07 11:26
Thu, 01 Feb 2007 13:53:46 -0600 from Aaron J. Bossig <linkvb06
@SpammersWillBeExecuted.ptd.net>:
> Which is why Rule #2 of Extended Warranties is "Always use them when
> you have them." Lots of people buy them and then never cash them in,
> which is of course a loss for the customer. And silly. Me, I keep the
> paperwork on hand and am ready to call the 1-800 number as soon as
> anything happens. As a result, I've never lost money on an extended
> warranty.
Of course you have -- every one you never had occasion to use is lost
money.
The point is that a very high percentage of what consumers pay on
extenfded warranties is lost money. I'm not talking about the people
who have a legitimate claim and don't pursue it, but about people who
never have a claim. Companies pay out very little of those premiums
in claims.
By contrast, a much smaller percentage of car insurance or
homeowner's or life insurance is lost money; insurance companies pay
our a much higher percentage of premiums in claims. In fact,
sometimes they pay out more than 100%, since they use both premium
payments and investment income to pay claims.
--
Stan Brown, Oak Road Systems, Tompkins County, New York, USA
http://OakRoadSystems.com/
DVD FAQ: http://dvddemystified.com/dvdfaq.html
other FAQs: http://oakroadsystems.com/genl/faqget.htm
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