NBC NEWS - So, Ainsley, what was the last extended warranty you bought again?

"I can't think of anything," says Ainsley Pierce.

Her husband Steve corrects her, "Every electronic piece of equipment you buy."

"Well, my phone," says Ainsley.

"The DVD for the kids. The portable DVD? It's an automatic yes," says Steve.

That's a lot of yes's. The Wii, the DVD, the TV, and the home phone system. The camera and iPhone, laptop, iPod, Nintendo DS, videocam, refrigerator, portable DVD, microwave, and coffeemaker.

With a couple of exceptions, Steve Pierce's answer if he'd been asked to buy warranties on that stuff?

"No," says Steve.

Why? Steve is an insurance broker.

Steve says, "I would immediately think they probably pay ten percent in claims, 90 percent profit. I say no."

Recently, the risk-averse Ainsley was forced to think at the register. She was buying a $250 Nikon Coolpix camera for a beach trip. The extended warranty was $50, making the total, with tax, $325. Why buy?

"You were worried about sand and the ocean," says Steve to Ainsley.

When asked if that is covered, Steve says, "We don't know because we haven't read the document."

In face, accidental damage not covered. The salesman told them it was. And furthermore, says University of Texas at Dallas warranty expert Ram Rao, "You don't wanna buy one for less expensive things."

But let's say you're buying a house and have a bunch of new appliances...Rao says, "Large expenses. Cash flow is a problem, you want to buy an extended warranty."

Steve's new Apple laptop? He bought the warranty because it also came with a service plan. Professor Rao says that's good.

As for Ainsley, the TV warranty she bought, "They talked me into it. Only $150. The bulb did go out. It was worth it," she says.

It's a numbers game. It's a risk, but the business of insuring this stuff actually has a 40 percent profit margin. So instead of automatically saying "Charge it," skip the little stuff, and make sure you do a little reading before you actually do charge it.

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