Warranty cost estimation of a multi‐module product

This article deals with the problem of cost estimation for increased warranty time of a multi‐module product. The warranty policy of interest is two‐dimensional involving warranty limits on both age and usage of the product. Failure of the product is caused due to malfunctioning of its module(s). Warranty service is rendered through repair or replacement of the respective module(s). From the past data, it is observed that age and usage are highly correlated. Based on life (age) data, the joint life distribution of the modules is well described by multivariate exponential distribution of Marshall and Olkin. The same is utilized to estimate cost for desired warranty times by the method of simulation.