Seniors targeted with extended warranty scams

Buy a car, furnace, or cell phone, and you'll likely be asked whether you want to pay extra for an extended warranty. The New Hampshire Insurance Department is warning consumers to be careful before saying yes.

While many companies sell legitimate contracts, there are a number using suspect sales practices to defraud Granite Staters with phony warranties, the department said in a consumer alert presentation on Dec. 18. and they are increasingly targeting seniors.

"We are seeing things like high-pressure sales tactics, misleading language, impersonation, fear-mongering, and unsolicited calls and mail going out to consumers that are causing those consumers real harm," said Commissioner D.J. Bettencourt.

This year, the New Hampshire Insurance Department has received 97 complaints concerning extended warranties, also known as consumer guarantee contracts. Those investigations recovered nearly $30,000 in fraudulent charges for individuals, said Keith Nyhan, deputy commissioner.

In one case, the department was able to return $5,000 to a person who'd been scammed into buying a phony extended warranty for a furnace, he said.

The department is trying to step up consumer protections in a couple of ways.

It has partnered with several Republican lawmakers on Senate Bill 515, which would outlaw marketing flyers that don't have the name of the company selling the extended warranty. The legislation would also require that all warranty contracts be registered with the state, and it would give the state department more authority to take action against companies selling phony warranties.

The department is also stepping up efforts to educate consumers on how to avoid being scammed.

First, beware of marketing flyers with no company information that urge you to get in touch or risk losing the free, standard warranty that came with your purchase.

The flyer may have information purporting to be an account number. There will likely be a phone number and no other way to reach the company. "I would throw it immediately in the trash," said James Fox, director of the Property and Casualty Division at the state Insurance Department. "Do not respond to unbranded mailers. Why is someone afraid to put their name on something?"

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Do not give out bank account or credit card information over the phone to a company seeking to sell you an extended warranty. "Seniors will get multiple flyers a week. They'll get calls constantly," Fox said. "That company will get the person's bank account numbers, and then all of a sudden, a charge shows up in the person's checking account but no policy shows up. and there is no other contact from that company."

Ask to see a contract before buying it and be sure to read it. If you have questions or suspicions, contact the Insurance Department by emailing consumerservices@ins.nh.gov or calling 1-800-852-3416.

You can email an image of a suspicious mailer or mail the flyer to the department at 21 South Fruit St., Suite 14, Concord, 03301.

Do the same, Fox said, if you have an extended warranty and are denied the coverage included in the contract.

Fox encouraged family members to talk to older relatives and look at bank statements for suspicious activity. "We'll protect as best we can," Fox said. "But there's nothing better than a family member protecting a family member."

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