rcd@opus.UUCP (03/10/84)
A service contract is basically just an insurance policy. You can evaluate
it the same way you evaluate your insurance needs.
Generally, insurance is a way to level out costs - instead of paying one
big amount of money when something happens, you pay a little bit of money
periodically. In the long run, and on the average, it costs more for
insurance than for the equivalent direct big amount of money. It must (as
long as the insurance company stays in business, that is), because the
difference is the profit for the insurance company.
Thus a service contract might be useful IF (1) you're buying something that
has a poor guarantee or none at all, (2) has expensive repair costs
compared to what you can afford, and (3) is very likely to break down.
Otherwise, don't bother - it's cheaper in the long run to pay for the
repairs when needed.
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{hao,ucbvax,allegra}!nbires!rcd