Things tend to break down eventually. Even high-quality products eventually break down. It doesn't happen all the time, but when it does, it's a pain.
Thankfully, purchased goods come with limited warranties, typically around a full year. However, sometimes a year just isn't enough, especially when you've vested your hard earned cash into an expensive product. But, you always hope that things will be okay. More often than not, consumers feel that extended warranty plans are just a scam, a way for companies to pocket more money without actually offering anything back.
Warranties, like insurance, work on peace of mind and yes, fear. This is why extended warranty programs have such a stigma over them. When you buy an extended warranty and something does go wrong after the initial period vaporizes, you feel glad that you bought it. If nothing goes wrong, you feel money was taken from you for nothing in exchange--especially when some extended warranties can be very expensive.
I once witnessed a retail sales person sell a customer on a $25 "extended warranty" on a $30 camera lithium-ion battery. First of all, you can't sell warranties on batteries, and second, that was an outright scam.
The question of the day is: Do you buy extended warranties for your devices?
Generally, if the warranty cost is less than 10% of the product cost, it might be worth it. If the extended warranty also covers more types of damage than a basic warranty, it might be worth it.
I have never, however, purchased those "extended warranties" from stores like Best Buy. They have such poor customer service to begin with, I can't imagine the hassles they put you through.
Say it's a $4000 HD TV, and they want $100, sure, $500, nope.
I didn't buy the warranty to make sure it was operational, I paid that much freaking money so that I would get a new one when it broke!
That's the last time I remember getting an extended warranty on anything.