Warranty: A real covenant binding the grantor of an estate and the grantor’s heirs; a collateral undertaking that a fact regarding the subject of a contract is or will be as it is expressly or by implication declared or promised to be; something that authorizes, sanctions, supports, or justifies; a usually written guarantee of the integrity of a product and of the maker’s responsibility for the repair or replacement of defective parts. Middle English warantie, garantie, to warrant.

U.S. federal law establishes minimum legal standards for warranties on products. Some companies, however, offer warranties (for purchase or for free) that exceed the legal minimum by covering a broader array of problems the buyer might face.

For example, Apple’s standard iPhone warranty includes one year of hardware repairs and 90 days of telephone support. However, an extended warranty can be added that provides full hardware and phone support coverage for two years. Private companies also offer warranties on electronics and other high value goods.

Every Toyota vehicle is supported by a 36-month/36,000-mile limited warranty coverage. In addition, most individual Toyota parts have 12-month coverage, a fairly standard warranty for new vehicles.

Most manufacturer warranties for electronics, appliances, etc. cover only products that fail due to defects in construction or malfunctions of the item’s hardware. Some consumers want more protection, so retailers like Best Buy offer protection plans that go beyond the manufacturer’s warranty. Best Buy‘s Geek Squad Protection Plan, for example, covers normal wear and tear, no lemon policy, accidental, and damage from handling. Since these plans cover a much wider spectrum of potential problems, they tend to be quite expensive.

In order to remain competitive, American retailers offer generous return and exchange policies. Most companies print their policy directly on the receipt and use phrases like „easy returns and exchanges,“ „no hassle returns“ or „100% satisfaction guarantee.“ Some companies, like outdoor supplier REI, allow customers to return products for a full refund or exchange at any time for any reason.

Many retailers (WalMart, Target) do not require a receipt for returns or exchanges. If no receipt is available, stores generally refund the credit on gift cards that can only be used at the store.

These generous policies highlight the importance that American consumers assign to customer-centered policies that are clearly communicated and executed in a friendly manner. Retailers, on the other hand, encourage buyers to spend first and think later. They give consumers confidence that satisfaction with a particular product or brand is guaranteed.