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Problem with claim for Credit Card's Extended Warranty

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  • Jan 7th, 2010 7:26 pm
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[OP]
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Jun 18, 2008
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Problem with claim for Credit Card's Extended Warranty

Hello all,
Maybe someone has some ideas on this...

I just called the CIBC Visa Insurance to open up a claim for "extended warranty" for an external hard-drive that I purchased on the card. The HD is out of manufacturer's warranty, but still within the 1 year extended warranty of the VISA.

I spoke to the lady who proceeded to ask me a bunch of questions... when she asked me what the "damage" to the item was, I explained that the hard drive inside is malfunctioning. She said the claim adjuster would probably deny the claim based on the "EXCLUSIONS" of the policy which states the following:
[QUOTE]
b) Excluded Items – Extended Protection does not cover the following items and services: automobiles, motorboats, airplanes and other motorized vehicle, and parts and accessories thereof; services; dealer and assembler warranties, normal wear and tear, used and pre-owned items, including demos, normal course of play, negligence, misuse and abuse, inherent product defects, willful acts or omission and improper installation or alteration, ancillary costs, any product purchased by and/or used for a business or commercial purpose, and any repair or replacement that would not have been covered under the Manufacturer’s Warranty.
[/QUOTE]

She said the item wasn't covered because it's an "inherent product defect". Now here's how these warranties are a HUGE scam.... this vague language they add in exclusions, basically allow them to deny any claim they want..... OFCOURSE it's an inherent defect.... I can't think of any problems or issues that could possibly arise with any product you buy, that couldn't be called an inherent defect. And if it's not an inherent defect, then it's an issue due to normal wear and tear.... in other words, they save their ASSES everytime.

Anyways, I haven't given up on this, but I'd like to see if anyone has been successful in claiming extended warranties, and what I should tell them in my case to get this claim thru....

Thanks!
39 replies
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yourmemory wrote:
Dec 1st, 2009 7:58 pm
Hello all,
Maybe someone has some ideas on this...

I just called the CIBC Visa Insurance to open up a claim for "extended warranty" for an external hard-drive that I purchased on the card. The HD is out of manufacturer's warranty, but still within the 1 year extended warranty of the VISA.

I spoke to the lady who proceeded to ask me a bunch of questions... when she asked me what the "damage" to the item was, I explained that the hard drive inside is malfunctioning. She said the claim adjuster would probably deny the claim based on the "EXCLUSIONS" of the policy which states the following:


She said the item wasn't covered because it's an "inherent product defect". Now here's how these warranties are a HUGE scam.... this vague language they add in exclusions, basically allow them to deny any claim they want..... OFCOURSE it's an inherent defect.... I can't think of any problems or issues that could possibly arise with any product you buy, that couldn't be called an inherent defect. And if it's not an inherent defect, then it's an issue due to normal wear and tear.... in other words, they save their ASSES everytime.

Anyways, I haven't given up on this, but I'd like to see if anyone has been successful in claiming extended warranties, and what I should tell them in my case to get this claim thru....

Thanks!
The adjuster you got on the phone is full of BS. Call back and get a new one who knows what they are talking about.

The product does not have an "inherent defect" because it worked for 3 years without issue. That is what that language is for - they are saying they don't cover it if it was broken when you bought it.
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brunes wrote:
Dec 1st, 2009 8:52 pm
The adjuster you got on the phone is full of BS. Call back and get a new one who knows what they are talking about.

The product does not have an "inherent defect" because it worked for 3 years without issue. That is what that language is for - they are saying they don't cover it if it was broken when you bought it.
An inherent defect is something that as part of the normal lifespan will eventually cause a failure. For example, fruits and vegetables eventually rot. That is an inherent defect. Unless all hard drives are expected to fail after a specific timeframe, it is not an inherent defect.
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yourmemory wrote:
Dec 1st, 2009 7:58 pm
Hello all,
Maybe someone has some ideas on this...

I just called the CIBC Visa Insurance to open up a claim for "extended warranty" for an external hard-drive that I purchased on the card. The HD is out of manufacturer's warranty, but still within the 1 year extended warranty of the VISA.

I spoke to the lady who proceeded to ask me a bunch of questions... when she asked me what the "damage" to the item was, I explained that the hard drive inside is malfunctioning. She said the claim adjuster would probably deny the claim based on the "EXCLUSIONS" of the policy which states the following:


She said the item wasn't covered because it's an "inherent product defect". Now here's how these warranties are a HUGE scam.... this vague language they add in exclusions, basically allow them to deny any claim they want..... OFCOURSE it's an inherent defect.... I can't think of any problems or issues that could possibly arise with any product you buy, that couldn't be called an inherent defect. And if it's not an inherent defect, then it's an issue due to normal wear and tear.... in other words, they save their ASSES everytime.

Anyways, I haven't given up on this, but I'd like to see if anyone has been successful in claiming extended warranties, and what I should tell them in my case to get this claim thru....

Thanks!
You took that out of proportion. She is not the adjuster and she said 'would probably'. Just submit the claim and let the real adjuster to do the job.
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[OP]
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Jun 18, 2008
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Yes, I do plan on calling back. I just figured I would read their extended protection policy first, to avoid putting my foot in my mouth when answering all their questions.

My main concern is they can't possibly prove whether any defect is or isn't "inherent", unless a technician was to take the thing apart and test it, and I highly doubt they go that far in these claims... so in other words, they can basically decide whichever way they want and there's nothing much one can do about it really.
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yourmemory wrote:
Dec 1st, 2009 9:43 pm
My main concern is they can't possibly prove whether any defect is or isn't "inherent", unless a technician was to take the thing apart and test it, and I highly doubt they go that far in these claims... so in other words, they can basically decide whichever way they want and there's nothing much one can do about it really.
Well I think this whole situation comes down to the fact that, now wait for it...

You haven't even submitted your claim! You were talking to an operator under-promising what would happen. You can't say it's a scam yet, because you really haven't used the service to completion.
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Ojam wrote:
Dec 1st, 2009 10:56 pm
Well I think this whole situation comes down to the fact that, now wait for it...

You haven't even submitted your claim! You were talking to an operator under-promising what would happen. You can't say it's a scam yet, because you really haven't used the service to completion.
+1

Submit it and come back to complain if you get denied. Otherwise you are worrying over nothing.
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Ojam wrote:
Dec 1st, 2009 10:56 pm
You can't say it's a scam yet, because you really haven't used the service to completion.
+1

Furthermore, even if the OP's claim does get denied that single bad experience hardly proves the assertion of the thread title (that all credit card extended warranties are a scam.) For every OP with a (maybe) bad experience there are 1,000s of people who have gotten reimbursed.
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bylo wrote:
Dec 2nd, 2009 8:43 am
+1

Furthermore, even if the OP's claim does get denied that single bad experience hardly proves the assertion of the thread title (that all credit card extended warranties are a scam.) For every OP with a (maybe) bad experience there are 1,000s of people who have gotten reimbursed.
Of course, there's also the fact that it's kind of hard for something that's given to you free to be a 'scam' since a scam is normally something that attempts to deprive you of something of value, such as money.
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bylo wrote:
Dec 2nd, 2009 8:43 am
+1

Furthermore, even if the OP's claim does get denied that single bad experience hardly proves the assertion of the thread title (that all credit card extended warranties are a scam.) For every OP with a (maybe) bad experience there are 1,000s of people who have gotten reimbursed.
Yeah I was just going to say I've been reimbursed for failed drives on two separate occasions, so I'd be surprised to hear that the adjuster denies this one. The CSR doesn't really know anything so you can't go by what they said.
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bylo wrote:
Dec 2nd, 2009 8:43 am
+1

Furthermore, even if the OP's claim does get denied that single bad experience hardly proves the assertion of the thread title (that all credit card extended warranties are a scam.) For every OP with a (maybe) bad experience there are 1,000s of people who have gotten reimbursed.
+2

Got so worked up reading the thread title.
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iamnotamerican.com wrote:
Dec 2nd, 2009 9:42 am
Of course, there's also the fact that it's kind of hard for something that's given to you free to be a 'scam' since a scam is normally something that attempts to deprive you of something of value, such as money.

Like the others, I think the OP is reacting too quickly.

I do have to disagree with the above statement, if the OP's scenario proved true.
The warranty really isn't provided free.
At minimum, the CC customer's pay through increased fees, charges, interest, etc.

Also, with something like a HDD, often there is a non-cash premium paid at purchase.
Someone may wish to use a CC, and pay the premium in exchange for an extended warranty.

Remember, the CC company uses this as a incentive for you to make purchases on your CC.
In the long run, it makes them money and that can only mean it costs us money.

This in no way means I agree with the OP.
I expect they will receive compensation.
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Jun 4, 2007
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It's an insurance product. All insurance adjusters are paid bonuses/promoted based on their ability to limit losses for the insurer. This is their job.

As the policy holder its in your interest to try to get the claim paid out. This is the game of insurance.

If you think this is fun, wait until you have to make a claim after a break-in or a fire. Some years ago, a friend had his stereo and all his CDs stolen in a break-in. The adjuster wanted proof he owned 200+ albums he had purchased over 15+ years. Who keeps those receipts? Luckily he had a photo of himself standing beside his CD rack. Lucky because this was before digital cameras.

I would fight that its not an inherent defect if the HDD failed well under its MTBF rating. Check the drive's model for this info. A MTBF of 50,000 hours is 5.7 years. Surely 2 years is less than its expected lifetime.
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I have the Citi Driver's Edge Mastercard and while I have not used the EW on it yet, I have used the price protection and even product assurance (I think that's what it's called, we had an ipod stolen out of a car). In both cases, I was able to get my money, although the stolen one took a long time, almost like a rebate company.

Both times I called to inquire about the status of certain things, they advised me that "we mailed that out at 9:45 this morning". Kinda funny how that happened twice on the two days out of about 3 months that I called. Sure enough, a week later in both cases I got the information/check I was waiting for. I swear they just clicked a button on the account to send the info and wouldn't have sent it if I hadn't called, even though I was approved.
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As others have said the OP should not get mad until they deny the claim. The only issue apart from the OP being a little high strung seems to be the CSR saying that the claim would probably be denied. I am not sure why any company would have their front line people say something like that to a customer as it is always going to cause frustration. The only person speculating on what decision a company might make with regards to a particular case is someone who has the authority to make that decision otherwise customers like the OP will get worked up over nothing.

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