A warranty is a voluntary promise from a person or business who sold a product or service to you.
The promise might be to repair or replace a product that develops a fault within a particular timeframe, or to do a piece of work again if it is not satisfactory.
When you buy the product or service, the warranty becomes a right that can be enforced under Australian Consumer Law.
The difference between a warranty and a consumer guarantee:
A consumer guarantee is an automatic legal right given to consumers buying a product or service in Australia. When buying the product/service, consumers are entitled to a product/service that is safe and without fault, that looks acceptable and performs as expected. If the product/service does not, consumers have a right to a remedy which may include repair, replacement or refund.
A warranty is a voluntary promise or commitment made by the business selling the product/service to you. When you buy the product/service, the warranty becomes a right. It operates in addition to a consumer guarantee however, it cannot limit or exclude consumer guarantees.
Warranty against defects
Some businesses will provide a warranty against defects (also called a ‘manufacturer's warranty’). This means if the goods/services are defective, the business will:
- repair or replace goods (or part of them), resupply or fix a problem with services (or part of them)
- provide reimbursement to the consumer.
A warranty against defects is usually limited by time. All suppliers, manufacturers and service providers that provide you with a warranty against defects must comply with that warranty. If they do not, you may bring an action against the person or business who provided the warranty, either under Australian Consumer Law or for breach of contract.
See an example
A consumer buys a deck chair that comes with a written warranty saying the manufacturer will replace the deck chair if it breaks within two years of the purchase date. This is a manufacturer's warranty.
Formal or informal document
A warranty against defects can be a formal written document or informal piece of evidence like wording on the packaging or on a label that contains a promise.
Formal written warranty
A document which evidences a warranty against defects must state:
- what the business will do if the goods are faulty or defective (eg repair or replace)
- what you must do to be entitled to claim the warranty (eg cease using the goods or contact the supplier)
- details about the business giving the warranty (eg name, business address, telephone number and email address)
- the warranty period (ie how long the warranty lasts for)
- how to claim the warranty (ie how to contact the business and where to send the claim)
- whether you or the business is responsible for expenses associated with a warranty claim and how you can claim back any expenses incurred
- that the benefits provided to you by the warranty are in addition to other rights and remedies available to you under the law.
A warranty document must include mandatory text to make sure you are aware that any warranty against defects operates in addition to consumer rights under Australian Consumer Law.
Before 9 June 2019, the mandatory text was:
Our goods come with guarantees that cannot be excluded under the Australian Consumer Law. You are entitled to a replacement or refund for a major failure and compensation for any other reasonably foreseeable loss or damage. You are also entitled to have the goods repaired or replaced if the goods fail to be of acceptable quality and the failure does not amount to a major failure.
From 9 June 2019, the mandatory text for the supply of services is:
Our services come with guarantees that cannot be excluded under Australian Consumer Law. For major failures with the service, you are entitled to:
- cancel your service contract with us, and
- a refund for the unused portion, or reimbursement for its reduced value.
You are also entitled to be reimbursed for any other reasonably foreseeable loss or damage.
If the failure does not amount to a major failure, you are entitled to have problems with the service rectified in a reasonable time and, if this is not done, to cancel your contract and obtain a refund for the unused portion of the contract.
From 9 June 2019, mandatory text for the supply of goods and services is:
Our goods and services come with guarantees that cannot be excluded under Australian Consumer Law. For major failures with the service, you are entitled to:
- cancel your service contract with us, and
- refund for the unused portion, or reimbursement for its reduced value.
You are also entitled to choose a refund or replacement for major failures with goods.
If a failure with the goods or a service does amount to major failure, you are entitled to have the failure rectified in a reasonable time. If this is not done, you are entitled to a refund for the goods and to cancel the contract for the service and obtain a refund of any unused portion. You are also entitled to reimbursement for any other reasonably foreseeable loss or damage from a failure in the goods or service.
Businesses are free to include extra information in a warranty against defects to explain how your rights under Australian Consumer Law apply.
Businesses often make extra promises (sometimes called 'express warranties') about the quality, state, condition, performance or characteristics of goods.
Australian Consumer Law states that if a business offers an express warranty, they are required to comply with it (in addition to the automatic consumer guarantee).
See an example
A supplier tells the consumer that a bed will last for 10 years. If the bed only lasts for six years, the consumer will be entitled to a remedy because the bed has not satisfied this express warranty.
An express warranty may not be in writing and is a promise usually made to persuade you to buy the goods – it is different to a warranty against defects.
An extended warranty (sometimes called a 'care package') is an additional warranty that provides repair and maintenance for a specified period. It may or may not extend the manufacturer’s warranty.
An extended warranty does not replace your rights under consumer guarantees. You may still be entitled to a repair, refund or replacement if a consumer guarantee is broken even when a manufacturer’s or extended warranty has ended.
Always read the terms and conditions of the extended warranty brochure carefully. The details in the brochure are legally binding so you should rely on what it says, not on what the salesperson says.
You do not have to buy an extended warranty – it is completely optional. Suppliers risk breaching the law if they:
- put too much pressure on you or use unfair tactics to get you to buy an extended warranty
- mislead you into paying for the rights that you already have under the consumer guarantees.
See our extended warranty checklist.
Have a problem?
- Contact the business in the first instance and explain the problem. We have tips and sample letters to help you take the first step.
- If you’re unable to resolve the matter with the business, you contact us on 13 32 20, or make a complaint online.
Be a savvy consumer
Always keep your receipts, invoices and warranties in a safe place. You may need them to provide proof of transaction and be eligible for repair, replacement or refund.
Extended warranty checklist
If you’re thinking about purchasing an extended warranty for a product or service, you should read the extended warranty brochure for the product/service and use this checklist to help you decide if the extra money is worth it.
Who is providing the extended warranty - a manufacturer, an insurance company or a retailer?
What is the period of the extended warranty?
When does the extended warranty start - from the date of purchase or after the voluntary or manufacturer’s warranty expires?
Terms and conditions
Are there any special requirements you need to follow for the extended warranty to be valid? For example, are there requirements for regular maintenance or servicing?
What does the extended warranty cover? For example, does it cover labour and parts?
What are the exclusions or restrictions? Typical exclusions may be transport or freight costs.
Does annual depreciation apply to the product if you replace or refund?
Are there any claim limits?
Are there excess fees for each claim you make?
Where and how do you lodge a claim? You may be restricted to a specific repairer and number of claims you can make.
What is the life expectancy of the product?
Is the product expensive?
Is it likely to break during the period of the extended warranty?
How much does the extended warranty cost in relation to the cost of the product?
Are you planning to move? This may cause problems if you are required to take the product to a particular location for servicing.
Is the extended warranty worth the extra money? Consider whether the statutory and the voluntary warranties will provide enough protection.
Can’t find what you’re looking for? Send a general enquiry.
Who enforces Australian Consumer Law?
The following agencies enforce provisions relating to consumer goods and services:
- Australian Competition and Consumer Commission (ACCC)
- NSW Fair Trading, and
- other State and Territory consumer protection agencies.
The Australian Securities and Investments Commission (ASIC) is responsible for financial products and services.