Warranty

Express warranties are created when the seller makes a guarantee to the buyer that the product/service being offered has certain qualities. For there to exist an express warranty 1) a statement regarding the product/service must be made to the buyer and 2) the statement must play a role in the buyers decision to purchase the product/service. If, after purchase, the buyer feels that the given statement was a misrepresentation of the actual product/service, the buyer can file for breach of express warranty.[5]

Implied warranties are unwritten promises that arise from the nature of the transaction, and the inherent understanding by the buyer, rather than from the express representations of the seller. In the United States, Article 2 of the Uniform Commercial Code (which has been adopted with variations in each state) provides that the following two warranties are implied unless they are explicitly disclaimed (such as an "as is" statement):

• The warranty of merchantability is implied unless expressly disclaimed by name, or the sale is identified with the phrase "as is" or "with all faults." To be "merchantable", the goods must reasonably conform to an ordinary buyer's expectations. For example, a fruit that looks and smells good but has hidden defects may violate the warranty if its quality does not meet the standards for such fruit "as passes ordinarily in the trade". In most states, products inherently come with implied warranty of merchantability; however, in states like Massachusetts under consumer protection law, it is illegal to disclaim this warranty on household goods sold to consumers. (Massachusetts General Laws, Chapter 106: Section 2-316A)
• The warranty of fitness for a particular purpose is implied unless disclaimed when a buyer relies upon the seller to select the goods to fit a specific request. For example, this warranty is violated when a buyer asks a mechanic to provide tires for use on snowy roads and receives tires that are unsafe to use in snow.

A common kind of warranty on goods is a warranty that the product is free from material defects in materials and workmanship. This simply promises that the manufacturer properly constructed the product, out of proper materials. This implies that the product is not defective for the purposes for which it was made.

Warranties may be time limited, thus limiting the time the buyer has to make a claim for breach of warranty. For example, a typical 90-day warranty on a television gives the buyer 90 days from the date of purchase to claim that the television was improperly constructed. Should the television fail after 91 days of normal usage, which because televisions customarily last longer than 91 days means there was a defect in the materials or workmanship of the television, the buyer nonetheless may not collect on the warranty because it is too late to file a claim. Consumer protection law, implement by statute, however provide additional remedies as it is not usually expected that a television will last for only 90 days.

Time-limited warranties are often confused with performance warranties. A 90-day performance warranty would promise that the television would work for 90 days, which is fundamentally different from promising that it was delivered free of defects and limiting the time the buyer has to prove otherwise. But because the usual evidence that a product was delivered defective is that it later breaks, the effect is very similar.

One situation in which the effect of a time-limited warranty is different from the effect of a performance warranty is where the time limit exceeds a normal lifetime of the product. If a coat is designed to last two years, but has a 10-year limited warranty against defects in materials and workmanship, a buyer who wears the coat for 3 years and then finds it worn out would not be able to collect on the warranty. But it is different from a 2-year warranty because if the buyer starts wearing the coat 5 years after buying it, and finds it wears out a year later, the buyer would have a warranty claim in Year 6. On the other hand, a 10-year performance warranty would promise that the coat would last 10 years.

In the United States, the Magnuson–Moss Warranty Act of 1976 provides for enforcement of a satisfaction guarantee warranty. In these cases, the advertiser must refund the full purchase price regardless of the reason for dissatisfaction.[6]

A lifetime warranty is usually a warranty against defects in materials and workmanship that has no time limit to make a claim, rather than a warranty that the product will perform for the lifetime of the buyer.[7] The actual time that product can be expected to perform is normally determined by the custom for products of its kind used the way the buyer uses it.

If a product has been discontinued and is no longer available, the warranty may last a limited period longer. For example:

• the Cisco Limited Lifetime Warranty currently lasts for five years after the product has been discontinued, but only if you know where you bought it from as the seller is responsible for administering it.[8]
• HP Networking product lifetime warranties last for as long as one owns the product.[9]

Warranties are breached when the promise is not performed at all, or not performed in accordance with the contract. The seller may honor the warranty by making a refund or a replacement. The statute of limitations depends on the jurisdiction and contractual agreements. In the United States, the Uniform Commercial Code § 2-725 provides for a four-year time limit, which can be limited to one year by contract, starting from the date of delivery or if future performance is guaranteed from the date of discovery. Refusing to honor the warranty may be an unfair business practice. In the United States, breach of warranty lawsuits may be distinct from revocation of contract suits; in the case of the breach of warranty, the buyer's item is repaired or replaced while breach of contract involves returning the item to the seller.[10]

Some warranties require that repairs be undertaken by an authorized service provider. In such cases, service by non-authorized personnel or company may void (nullify) the warranty. However, according to the Magnuson-Moss Act (a U.S. Federal law that governs warranties, which was passed in 1975), if the warranty does not provide full or partial payment of labor (to repair the device or system), it is the owner's choice who will provide the labor, including the possibility of DIY ("Do It Yourself") repairs, in which case the device or system owner will pay zero dollars for labor, yet the company that provided the warranty must still provide all the parts needed for the repair at absolutely no charge to the owner.

If the defective product causes injury, this may be a cause of action for a product liability lawsuit (tort). Strict liability may be applied.

Written warranties on new major appliances, such as refrigerators, kitchen stoves and dishwashers, usually cover the cost of parts and labor to repair defects in materials or workmanship which appear under normal home use.

Warranties often cover defects up to a year after purchase or delivery.[17] However some exclude new owners when a house or appliance is sold within the year (Frigidaire,[18] LG,[19] Samsung[20]). Others do let warranties transfer to new buyers (Amana,[21] General Electric,[22] Whirlpool). Some manufacturers cover refrigerators' sealed parts (compressors, tubing, etc.) for five years (General Electric,[22] Samsung,[23] Whirlpool)[20] or seven years (LG[19]) or ten years (KitchenAid[24]).

Warranties on water heaters cover parts for 5 to 12 years in single family residences, one year otherwise. They do not cover new owners when a house or heater is sold; nor do they cover the original owner if the heater is moved to a second location.[25] [26] [27] [28] [29] Tank models from A. O. Smith do not allow heating elements to be replaced with lower (or higher) wattages, and do not cover renter-occupied single family. They end if the unit is flooded or ever uses desalinated or deionized water, such as municipal desalination plants or reverse osmosis filters.[27][28] Smith's tank models for manufactured housing do not provide coverage if a whirlpool or hot tub is connected.[28]

Tank water heater warranties exclude labor, liability for water damage, and shipping cost to return the old heater or parts. Tankless warranties do not exclude water damage; they cover labor for a year, and Ruud/Rheem covers return shipping on tankless models.[26][29] Smith's tankless water heaters do not restrict coverage to a single family, and require professional installation.[29]

Implied warranties under US law could extend for longer periods. However, most states allow the written warranties to include clauses which limit these implied warranties to the same time period as the written warranty.[30]

New car factory warranties commonly range from one year to five years and in some cases extend even 10 years, with typically a mileage limit as well. Car warranties can be extended by the manufacturer or other companies with a renewal fee.

Used car warranties are usually 3 months and 3,000 miles

In the United Kingdom, types of warranties have been classified as either an:

1. original manufacturer warranty,
2. insurance warranty underwritten and regulated as insurance or
3. obligor warranty, typically written by a car dealership or garage.

In the United Kingdom, the Financial Conduct Authority (FCA), which began to regulate insurance contracts in this context in 2005, determined that additional warranties sold by car dealerships are "unlikely to be insurance".[31] Insurance warranties may offer greater protection to the consumer.

A home warranty protects against the costs of home and appliance repair by offering home warranty coverage for houses, townhomes, condominiums, mobile homes, and new construction homes. When a problem occurs with a covered appliance or mechanical system such as an air conditioning unit or furnace, a service technician repairs or replaces it. The homeowner may have to pay for a service call fee and the home warranty company pays the balance for the repair or replacement of the covered item.