Should I Buy the Insurance Offered With My New Appliances?

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Q: When I was at the appliance store to buy a washer and dryer, the guy offered me an insurance policy with it. Should I have bought it?

I was shopping recently for new appliances and, when I found the washer and dryer I wanted, the salesperson tried to talk me into buying an insurance policy to cover the appliances. I said no, because I am always afraid those upsells are a little scammy, but it was a really big purchase and now I'm second-guessing myself. What should I have done? Did I make the right call?


A: This is a question I hear surprisingly often, and the fact is, you were most likely right to turn it down. Let me explain. 

When it comes to insurance, you should never forgo the opportunity to treat an exposure if the realization of your risks could ruin you financially. However, the inverse is also true: you should never purchase insurance against hazards for which, were they to happen, you can afford to handle without financial ruin. 

Let’s face it; the new washer and dryer you are purchasing are not really likely to break down in the next few years. If you can afford to pay a repair guy $200, or whatever it ends up costing, to fix them, then forget the insurance and keep the money you would have spent on premiums in your pocket. It is a smart financial move to spend less on the things that statistically are not likely to break. 

Now, in the event that a $200 repair bill would actually put in you in dire financial trouble, then yes, by all means, purchase the insurance policy. However, this is not usually a likely scenario for people who are purchasing brand-new appliances.

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