What you'd pay out of pocket if it failed.
As a percentage (0–100). Be realistic — quality goods rarely exceed 15–20%.
Verdict
—
Expected value of cover—
Warranty price—
Net expected gain/loss—

An estimate for guidance only, not financial advice. Calculations run in your browser.

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How the maths works

An extended warranty is insurance, and insurance is worth buying when the cost is low relative to the risk you are covering, or when a failure would be financially painful. The rational test is expected value: multiply the likely repair/replacement cost by the chance you will actually need it, and compare that to the warranty price.

If the warranty costs more than the expected loss it covers, it is — on average — a losing bet, which is exactly why retailers sell them so hard. It can still make sense if you could not absorb the worst-case cost, or for genuinely failure-prone items. This calculator shows you both the expected value and a clear verdict.

How to estimate the inputs

  • Warranty price — what the plan costs.
  • Likely repair/replacement cost — roughly what you would pay out of pocket if it failed (often close to the product price for cheaper electronics).
  • Chance of failure in the period — your honest estimate of the probability it fails within the warranty term. Most quality products fail well under 20% of the time in the first few years; be realistic and avoid fear-driven guesses.

Consumer-protection bodies such as the FTC note that many products already carry a manufacturer warranty and that paid plans frequently overlap with protections you already have — factor that in before paying extra.

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Frequently asked questions

Are extended warranties worth it?
Usually not, on average — which is why retailers push them so hard, since they are very profitable. The rational test is expected value: the likely repair cost multiplied by the probability of failure. If the warranty costs more than that expected loss, it is a losing bet on average. Extended warranties can still make sense for failure-prone items or when you genuinely could not afford the worst-case repair.
How do I decide if a protection plan is worth buying?
Estimate three things: the plan's price, what a repair or replacement would actually cost you, and the honest probability the item fails during the term. Multiply the repair cost by the failure probability to get the expected value of the coverage. If that figure is higher than the plan price, it may be worth it; if it is lower, you are likely overpaying. This calculator does that comparison for you.
Don't I already have a warranty?
Often, yes. Most products come with a manufacturer's warranty, and consumer-protection laws may give you additional rights, so paid extended plans frequently overlap with coverage you already have. Check what protection the product and your local consumer law already provide before paying extra for a plan that may duplicate it.
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