Smart Consumers Plan for the Unexpected

(Tallahassee, FL) – November 1, 2012 — A nationwide survey by Hart Research
Associates revealed that 48 percent of Americans say they do not have the savings they
need to achieve financial stability, and an October report by Consumer Reports states
financial woes are deepening for middle- and upper-income households. “While some
maintain consumers should put aside cash for repairs and replacement of essential
electronic products or appliances, it is not possible or practical in today’s economy,” says
Timothy J. Meenan, Executive Director of the Service Contract Industry Council
(www.go-scic.com). “An extended warranty can help consumers manage unanticipated,
unbudgeted expenses.”
Extended warranties are a fixed component of retailing in America, particularly in
uncertain economic times: they meet a large market demand; provide an enhanced quality
product; and at 10-20 percent of a product’s cost, an extended warranty more than pays
for itself when the simplest product repairs typically cost significantly more than the
price of an extended warranty.
Annual sales of extended warranties hover around 250 million annually for consumer
electronics; 11 million warranties alone are sold annually for PCs and laptops. An
extended warranty complements a product’s limited manufacturer’s warranty where it
falls short and then extends the repair and replacement coverage after the relatively brief
term of the manufacturer’s warranty expires.

REPAIR DATA: Consumer products, top failures and average repair costs.
Laptop: $650. Average Extended Warranty: $65-130.
Component Average Repair Cost
Mother Board $450.00
LCD Screen $350.00
Hard Drive $200.00
Optical Drive $180.00
Source: N.E.W. Customer Service Companies, Inc. (NEW)

LCD TV (37” or larger): $1,500.00. Average Extended Warranty: $150- $300.
Component Average Repair Cost
Panel $1,200.00
Control Box $560.00
Inverter & Main Board $340.00
Power Supply $265.00
Source: N.E.W. Customer Service Companies, Inc. (NEW)

Refrigerator (side by side): $1,200.00. Average Extended Warranty: $160 – $200.
Component Average Repair Cost
Compressor $500.00
Condenser $450.00
Evaporator $400.00
Defrost Heater $225.00
Source: Assurant Solutions

Tablet: $425.00. Average Extended Warranty: $45 – $90.
Component Average Repair Cost
Main Board $330.00
Digitizer $230.00
LCD $230.00
Source: N.E.W. Customer Service Companies, Inc. (NEW)

Purchasing an extended warranty provides protection, peace of mind and a full
complement of benefits: 24-hour toll-free technical support; access to local, pre-qualified
repair and service professionals, power outage and surge damage protection, and a 30-day
free look back period so if you believe you purchased the warranty impulsively, you can
return it.

To ensure the highest quality customer service, protect consumers from unethical
providers, and safeguard the integrity of the industry, the majority of service contract
providers proactively seek and secure regulatory oversight from state insurance regulators
and state legislators nationwide.

For all of these reasons, an extended warranty is a practical and intelligent way to provide
certainty that an unexpected repair or replacement will not impose a sudden financial
hardship, at a time when consumers are already challenged by current economic
conditions.

About the SCIC
The Service Contract Industry Council (www.go-scic.com) is a national trade association established in
1989 that has been instrumental in working with state legislatures and regulators across the country to
develop and pass legislation to protect consumers and enhance the integrity of the industry.