SquareTrade Protection Plan, Heavily Pushed by Amazon, Class Action Settlement

I recently had to file a claim with square trade and the experience left me wanting to file a suit of my own after ending up with a $750 penalty for an honest mistake that caused a violation of the terms of my warranty on a $200 product.

I bought a $200 phone and bought a $50 2 year accident warranty with it. It was not made very clear but there was a $50 deductible on claims. Even then, I'm happy with those odds given that I've broken a lot of phones.

So about a year in I crack the screen and file a claim. No major issues, in about a week they send me a new phone.

About a month later I receive an email saying that due to my failure to send in the original phone, I will be receiving a fee of $750 ($650 more than the maximum amount I stood to benefit by holding this warranty). During the whole claim process I have absolutely no recollection of anyone asking me to send in the damaged phone. As far as I can tell the single request that I got for this was an email that I missed, no follow up, just a letter to tell me I had been charged.

After an absolute battle to get a human being on the line at their support line, which is filled with circular paths and nonsensical questions (I seriously mapped out the various paths and not a single one gets you to a live human being related to an existing claim, you have to go down a sales path to get a real person and then get transferred), I got an operator and they gave me an address that I could send the phone to to get my "fee" refunded.

As it turned out the phone had been sitting in my house and I had thrown it away days earlier by coincidence. I dug through the trash thinking it wouldn't be there and at the very bottom I found it. I sent it back about three weeks ago. I've had to call back three times now using the trick method to talk to a real human being and demanding managers of managers of managers to get to a person who could give me info on my refund.

My refund did show up on my credit card statement as of yesterday. I estimate I put in about 15 hours in my attempt to reclaim the money Square Trade stole from me.

I'm pretty sure if the garbage had gone out the day before they'd still be holding my $750.

I will feel an unbelievable degree of happiness if this suite gets me the original cost of that warranty. It would be the sweetest $100 of my entire life.

Protection plans are usually a bit of a scam anyway and often duplicate warranty coverage and coverage offered by credit cards and sometimes renters policies. Most electronic devices that are going to fail do so within the warranty period. In our disposable planned-obsolescence world the cost of the plans can often be a significant portion of the cost of a device that is planned to fail after 3-5 years and probably spent on the replacement.

However I can’t stop my wife from buying them, she probably paid for two phones over the years on a monthly protection plan offered by T-Mobile. When her phone finally broke she tried to use the policy to replace it, only to be told her phone was too old to replace. She got $50 refund of her last two months protection plan payment.

Sellers love protection plans because they are often pure profit - that’s why they push them so hard.