The ACCC has accepted a court-enforceable undertaking filed by the Virginia Surety Company after engaging with and reviewing the selling practices of the extended warranty industry.
ACCC Commissioner Sarah Court says the regulator “has engaged with industry over concerns that certain marketing practices for extended warranties had the potential to mislead consumers about their true value beyond those rights and remedies already available to consumers under the Australian Consumer Law.”
As a result of the undertaking, VSC has said it will work with retailers to revise extended warranty brochures to include additional information to assist consumers in comparing the features of the extended warranty being sold with the existing remedies available under the ACL and provide consumer law compliance training to VSC’s representatives and retailer staff.
Similar measures were agreed with Lumley last December.
“The ACCC welcomes the approach of VSC and will continue to urge other industry participants to adopt similar measures to improve extended warranty selling practices. Misleading representations made by large retailers about extended warranties are a priority enforcement area for the ACCC. Where appropriate, the ACCC will take enforcement action to address concerns,” Ms Court said.
Malpractice in the area of extended warranty has long been an issue on the ACCC’s radar – with Harvey Norman has long been considered by some to be a particularly bad offender.
The retailer has racked up $286,000 in penalty orders against 10 franchisees since 2012.
