Service Plan - Differences From Warranties

Differences From Warranties

A service plan is a separate policy from the manufacturer's warranty. While the typical service plan does require preventative and routine maintenance to be taken in accordance with the manufacturer's warranty, it does not actually require a product to fail or malfunction under the same conditions. Service plans are also active from the date of purchase, unlike extended warranties, which become active when the manufacturer's warranty expires, meaning products can be purchased with service plans that is before or at the same time as the manufacturer's warranty.

The key distinction is that a warranty strictly covers defects in workmanship and materials, while service plans cover product failure in general with a list of exclusions. While the exclusion list includes most situations that would disqualify a product from warranty coverage, there are things that fall outside the product's condition that aren't excluded, such as power surges. However, this is offset by the infrequency of covered conditions, and misinterpretation. For example, a lightning strike is considered an environmental cause, and consequently is excluded from most service plans, even if they claim power surge protection.

To help differentiate from manufacturer's warranties, service plans occasionally come with additional benefits, such coverage for theft or accidental damage, replacements if a product fails a given number of times ("no lemon policy"), access to additional services, priority service and technical support.