Paying for JB Hi-Fi extra care

As you go up to pay for your new TV or computer, the helpful salesperson might suggest you take out JB Hi-Fi extra care. If you’re forking over a few thousand dollars, the extended warranty might seem like a good idea, but is it?

Consumer advocates maintain that extended warranties give you no more protection than what you are entitled to under Australian Consumer Law (ACL), with the “junk add-on" coming under fire in the Supreme Court of Victoria.

 

 

Maurice Blackman launched a class action against JB Hi-Fi in December 2023, claiming extended warranties were of little or no value because customers already had the same rights for free. They are seeking refunds for consumer who took out JB Hi-Fi extra care, also known at various times as extended care or customer care, between 1 January 2011 and 8 December 2023.

The electronics retailer maintained it had complied with all relevant laws and would “vigorously defend the proceedings”.

What about other electrical retailers?

JB Hi-Fi is by no means the only electrical retailer encouraging customers to buy extended warranties on their products.

When consumer watchdog Choice conducted a mystery shop of 80 Harvey Norman, JB Hi-Fi and The Good Guys stores around in Australia, they found seven in 10 misrepresented consumer rights.

Under the ACL, you are entitled to a repair, replacement or refund if a problem occurs within a “reasonable time” after purchase.

But when Choice mystery shoppers asked retailers what would happen if the TV they had bought developed a fault after the one-year warranty expired. Most stated or implied that the chances of getting a free remedy were slim or non-existent.

Worse still, the conversation would then turn to the benefits of an extended warranty, with 73 of the 80 salespeople Choice spoke to offering to sell one.

 

 

The Harvey Norman extended warranty is known as ‘product care’, which starts after the initial manufacturer’s warranty expires and can be taken out for one to four years, depending on the product.

JB Hi-Fi offers a voluntary warranty period, with the length of cover also determined by the price and type of the product. JB Hi-Fi extra care offers replacement cover for products costing less than $1000 and repair for more expensive products.

The Good Guys extended warranty is a two-year voluntary warranty, with a replacement or refund only offered for the first six months. After that, a repair is the only remedy available.

Falling for the hard sell

Extended warranties are voluntary, not something you should feel bulldozed into buying. And they aren’t cheap, so you really should think carefully before handing over extra money.

Handle My Complaint CEO Jo Ucukalo says extended warranties can drive the cost of a product up by about 20 percent, with no added value. With one in three Australians taking out extended warranties, Australians have been paying something for nothing for decades.

So why are we still buying them? Many Australians are not aware of their rights, for starters. If you’ve just bought a TV for $2000, it might not seem unreasonable to take out some extra protection in case it needs repairs outside the manufacturer’s warranty. However, if you knew going into the store that this protection is no different to your entitlements under Australian Consumer Law, you wouldn’t fall for the hard sell.

However, some of the uncertainty around the wording of the ACL is also causing confusion. “The law uses the ‘fair and reasonable’ test without providing the necessary detail to quantify what that is,” Ms Ucukalo said. “The Government needs to create a clear table and timeline for consumers, so they know what is ‘fair and reasonable’.”

   

Feeling pressured or misled?

Choice found retailers’ sales tactics questionable, with many stores saying that unless you bought JB Hi-Fi extra care or Harvey Norman product care, for example, you would have no rights to a repair or replacement after the manufacturer’s warranty expired.

Maurice Blackburn allege that JB Hi-Fi used misleading or deceptive conduct or unconscionable conduct when selling the extended warranties saying they either explicitly or implicitly told customers:

• • Operated for longer than the rights under the Australian Consumer Law
  • Provided benefits that the Australian Consumer Law did not
  • Were of value to customers

 

 

Providing misleading information about extended warranties can result in fines of up to $1.1 million. If you believe you were pressured or misled into buying an extended warranty, you have several options to lodge a complaint and seek resolution:

• • Approach the business
  • Contact your local consumer protection agency
  • Complain to the ACCC

If you are having trouble getting something repaired or replaced under an extended warranty, get in touch with us, and we’ll help you handle it.