Asda is to offer a free three year warranty on all electrical goods bought in its 240 stores.
Currently, shoppers pay £607m a year to insure brown and white goods.
The Asda warranty, based on the pilot scheme tested at its Asda Wal-Mart Supercentre in Bristol, will be available from November 7.
The free warranty coincides with Asda introducing its widest ever selection of electrical items.
The new range will include Aiwa, Philips, Schneider and Sony brands.
Asda said the new deal will shock the major high street electrical retailers who, it claimed, relied on the sale of extended warranties to boost profits.
Asda's selection of electrical goods includes big brand music systems, televisions, DVD players and video recorders.
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