zeth006 wrote:It's one thing if we're talking about health insurance. I would argue much of your health, genetics and unexpected circumstances aside, is controllable. But laptop failure rates much of the time aren't.
Most people won't be pouring water over their keyboards or dropping their notebooks from 10-story buildings. But the reality is that we're subjecting our notebooks to constant movement. Plus it doesn't help that all those tiny parts themselves aren't exactly fail safe. Whether or not Square Trade profits from their insurance business probably isn't the first consideration when deciding whether you should buy a warranty from them--especially when you examine how good they are about refunding you the entire purchase price of your notebook in the event they find they can't fix it. Check out their ratings on Amazon and resellerratings. And keep in mind that peace of mind is often worth the price tag.
My last Dell's GPU died as a result of a defective design which Dell refused to repair without reimbursement. My Asus's display and the connector cable gave out just over a year after I'd bought it. In the first instance, insurance would've prevented me from having to pay $150 for the GPU replacement, $30 for shipping, plus unstated labor charges. In the second instance, I was lucky to have had Asus repair both parts for free. I estimated that it would've cost me at least $150 for the monitor, perhaps $10-20 for the cable, and a decent premium for labor. Shipping cost me $30 but would've been free if I'd covered the notebook with Square Trade. Note: I took very good care of both notebooks. The Dell is self-explanatory. The Asus rarely left my desk except for a couple of trips to the coffeshop.
That's why for my HP which cost $1,250 before heavy discounts, I paid $130 for a 3-year warranty. SQ provides the shipping label free in the event of a repair, and as I mentioned above, they'll reimburse you the original price you paid for your notebook when they find they can't repair it. Their ratings have been consistently good for the past several years. Yes, they are probably profitable. It's one thing if they're running a ripoff scheme. But is there something wrong with companies turning a profit these days? Do we really need a math major to figure out that an insurance scheme in which 20-30% of notebook owners get some kind of damage will still result in net profits?
I didn't realize they'd refund the full price of the laptop if they couldn't fix it. It almost seems like people could easily cheat them out of money but obliterating their laptop towards the end of the warranty.
I do think there are instances where insurance is worth it. For most people buying a 500-700 laptop I really don't think it is considering the pace of development and price drops. But to blanket recommend insurance for that type of device is flat out wrong. If you really get peace of mind out of it then sure, buy it. But if you are looking at it from a cost standpoint, I'm not convinced it is worth it most
of the time for the average user. If they actually do full refunds fairly easily, then I might think differently.
The thing is, you know about how often your laptop is going to fail based on the history that the company has had with similar products. So if a $500 laptop fails 20% of the time within 2 years, there is a certain price point at which insurance is worth it, but above that point it isn't cost effective.
There's nothing wrong with turning a profit, my point was that not everyone, heck maybe not even most, should buy insurance for a laptop. Showing that the customer is losing money on average was my point.