Extended Protection Plan vs. Manufacturer Warranty: What's the Difference?
B2C, warranties

Extended Protection Plan vs. Manufacturer Warranty: What's the Difference?

Product protection plans, manufacturer warranties, extended service contracts, limited warranties… what does it all mean? Going by many different names, product protection plans and manufacturer warranties often cause confusion among consumers, especially when it comes to understanding the differences between the two. Let’s clarify what each of these terms mean and dig into their differences.

What is a Manufacturer’s Warranty?

A manufacturer’s warranty is an agreement that comes with the purchase of a product and is included in the purchase price. This warranty makes some form of statement regarding the company’s promise to make any repairs or replace defective parts within a specific time period. While it varies by product, a 90-day warranty is pretty standard.

What is an Extended Protection Plan?

An extended protection plan is a separate agreement that is purchased by the customer and designed to provide additional protection outside of the manufacturer’s warranty. This can include coverage for product issues after the manufacturer’s warranty has expired, as well as coverage for issues beyond the product defects covered by a typical manufacturer’s warranty. Extended protection plans can go by other names, including extended service contracts and extended warranties, even though they are technically not a warranty -- a term which refers to a manufacturer’s warranty or guarantee.

When Does Extended Protection Make Sense?

Extended protection plans are extremely popular among customers who want extended coverage for expensive purchases that they value as a long term investment. Such items can include home furniture and appliances, computers and electronics, cars and boats, and other valuable items. An extended warranty then becomes very helpful to provide protection for these purchases beyond the short term manufacturer’s warranty.

Additionally, extended protection plans often provide benefits that are not always covered under the terms of a manufacturer’s warranty. Extended service contracts offer peace of mind should something go wrong, break, or need repairs or replacement for reasons other than product defects. For example, product protection plans can include accidental damage from handling, covering issues such as spills on furniture or power surges on electronics. While a manufacturer’s warranty will only cover defective parts, pre-existing at time of purchase, extended protection plans will cover issues that come up from normal product use.

If you decide to take advantage of extended protection, be sure to read the service contract along with the manufacturer’s warranty so you know just what is protected and for how long. If you’re looking to protect key purchases for the long-haul and not worry about issues popping up from using your favorite products, an extended service plan may be just the thing you need.

New call-to-action

This post was originally published September 2018 and updated January 2021.