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How safe are Sears warranties during bankruptcy?

Sears
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It was America’s retailer, long before Amazon. But now Sears is filing Chapter 11 bankruptcy and closing another 140 stores — in addition to well over 1,000 stores the past five years.

While the company will remain in business, longtime customers are a bit nervous, wondering about warranties for all those appliances they bought, as well as Shop Your Way reward points and gift cards.

Sears shoppers like Cleo Pennington have a lot of questions about the bankruptcy.

“I’m very sad. Very, very sad,” she said.

So we checked the fine print in the Sears announcement to get answers.

Q: Are all stores closing? 

A: Sears says no, and insists it plans to emerge from bankruptcy a stronger, leaner company.

Q: What if you have a gift card? 

A: They are still valid, but any time a store files for bankruptcy, you may want to use them as soon as possible, just to be safe.

Q: What about Shop Your Way rewards?  

A: They are still valid at remaining Sears and Kmart stores.

Q: Will appliance warranties be honored? 

A: Sears says it will honor them as long as it remains in business. That includes extended protection plans and full home warranties. However, Business Insider says if the chain decides to liquidate next year, then warranties could become worthless.

Q: Where can you still find Kenmore appliances?

A: In remaining Sears stores, at Sears.com, and on Amazon.

More than just an appliance store

But Sears wasn’t just where moms and dads shopped. Tens of millions of children looked forward every Christmas to The Wish Book, filled with dozens and dozens of toys.

Cheryl Ayers remembers it well, “It was a big deal when that catalog would come in the mail every Christmas and we would go through it with a pen and circle what we wanted Santa to bring,” she said.

Back in the 1920s and 1930s, Sears even sold houses, which today are still dotting neighborhoods across the country.

But the houses went away after World War II, while Amazon, Target, and Walmart took the toy business, and Best Buy, Home Depot, and Lowe’s took the appliance business.

Sears will continue to sell Kenmore appliances in remaining stores and online, but Cheryl Ayers says it’s not the same.

“This is the end of a dynasty and it’s sad,” she said.

Sears will still have 600 stores remaining, and a website.

But with big-name brands like Whirlpool pulling out, no one is sure how much longer remaining stores can survive. Business Insider worries some prospective customers may now be afraid to purchase a major Sears appliance, wondering about the future.

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John Matarese

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