Home Warranty Gotchas

SHARING IS CARING

[xa_acc style=”xa-blue”][xa_slide title=”Gotcha #14: WATCH OUT FOR THE RENEWAL RATE (SUCKER RATES)!”]Ok so the initial rate looks great! Make sure you know what the renewal rate is. Some companies increase their rates $75-$150 or more upon renewal. Now you say no problem, I will switch companies. Well in this case, you would be going in under a plan for an existing homeowner and the costs are even more and there are limitations. TRUST US ON THIS ONE! Nothing in life is free! Home warranty companies understand their markets and expenses and set their plan costs accordingly. Unless you are real unhappy with a company it is usually cheaper to stay with the same company.

For many companies, the real estate (initial low priced) home warranty is a loss leader bringing new clients and renewals at higher rates. Now you may ask, how do home warranty companies justify doing this. In many cases, you only find this on new homes as the risk of a claim is much less. This is because the home is inspected closely by an appraiser and and inspector in most home sales. Now compare this to a person calling up and signing up for a home warranty when they need it. Hum? Get the point? The risk is much higher and the home warranty company has no idea what the condition of the home is.
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[xa_slide title=”Gotcha #15: DO YOU HAVE A 30 DAY GUARANTEE?”]Not many people know it, but most home warranty companies come with a 30 day money back guarantee . If you are unhappy, express your feeling and see if the company will correct the problem. If they do not, exercise your right to cancel for a refund.
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[xa_slide title=”Gotcha #16: MOLD IS NOT COVERED!”]You are most likely aware that as of today, most homeowner insurance companies are excluding mold coverage. Do not make the mistake of thinking your home warranty will cover it. It you think it does, read your contract again. If you’re still not convinced, call the 800-service number for the home warranty company.
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[xa_slide title=”Gotcha #17: HOME WARRANTY CLAIMS DO NOT GET REPORTED ON YOUR C.L.U.E. OR APLUS REPORT!”]You may have heard by now that many homeowner insurance companies are canceling some clients because of claims. The good news is that currently, to our knowledge, Home Warranty Claims are not reported to any type of centralized database like homeowners insurance claims are.
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[xa_slide title=”Gotcha #18: DOES THE SELLER BUY THE HOME WARRANTY?”]It is customary in most real estate transactions that the seller provides a credit back to the buyer for a home warranty. The buyer should always ensure they have the right to select the home warranty plan.

Your realtor may make a recommendation of one to three companies or HomeWarrantyExperts.com to avoid liability issues. Since some realtors get a kickback from the home warranty company, we always recommend you ask your realtor these questions. Do you get a kickback on this warranty? Second, ask if they use that home warranty company themselves. You may be surprised at the responses. Do your research and get the right plan for you. That is where HomeWarrantyExperts.com can help you.
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[xa_slide title=”Gotcha #19: GETTING AROUND THE NOT COVERED RESPONSE!”]So you are a new homeowner and you were just told that your home system or appliance was not covered due to lack of maintenance. You will probably be upset at the home warranty company, the person who sold or recommended the warranty to you.

Not all is lost!. Here is what we recommend you try. Depending on what home system or appliance is having the problem, review your contract on the exact specifics of what is excluded and why. In many cases, it may be easier for a home warranty company to deny claims up front, because most people will not escalate to a manager. Ask the manager what the dispute process is and what other people have done in this case to successfully get the problem resolved.
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[xa_slide title=”Gotcha #20: CALLING IN A CLAIM!”]If there is one thing you remember from this site, please print, highlight and then underline this one.

How the claim call works. When you call the 800-number for service, the home warranty customer service representative will identify themselves to you. Make sure you always write down their name and id number. Their job is to screen all calls and determine if the broken home system or appliance is covered by your home warranty.

REMEMBER, every word you tell the customer service representative is logged into the computer for reference to this call and future calls. If they feel there is any doubt, they may tell you the broken home system or appliance is “NOT COVERED!” If the item is covered the customer service representative will schedule a technician to contact you.

The technician will contact you and come out to your house to repair the home system or appliance. Now these guys are usually very familiar with the home warranty plans and will know if the problem is covered and will be very helpful. Most technicians are honest and work hard to make sure you are getting the best value out of the home service contract.

On the other hand, there are always small percentages of bad technicians that slip through the screening and will try to take advantage of the client. For example, an AC unit is on the roof and the service technician says the coils are dirty when in fact they are not. This example came from a retirement community in Arizona.

Dirty coils are not covered by most home warranty plans and it may cost you an additional $120 for the AC technician to clean them. In addition, if you authorize the repair and pay the technician, and he reports it back to the home warranty company, they may decline all future AC claims due to lack of maintenance. If you are ever in doubt or feel the technician is not on the up and up, immediately call the home warranty company and ask for their recommendation before authorizing any repairs to be done.

In general, they may inform you that it is your responsibility to obtain a second opinion to validate your conclusion. You will have to pay for the technician, but if the home warranty buys in on the diagnosis of your technician, they will usually cover the item and have a nice talk with their technician. Now we want to be clear, this is a rare occurrence, but it does happen.

Another thing that may happen is that one service company may subcontract to another or there may be many hands touching the report before it reaches the home warranty company. You may have a great service technician that reports back one thing to their company, and by the time it gets back to the home warranty company for logging, the information maybe totally incorrect. ALWAYS keep your copy of the receipt and have the technician detail out their diagnosis.

If the item diagnosed reveals the item is covered, the technician will normally fix it on the spot. You pay the trade service fee and they are on their way.

So, as you can see, it is very important what you tell the 800 service line when calling in. We recommend doing the following as a guideline. First always review the contract for the area that is broken for included and excluded items. If the item is excluded why call it in and have it logged in the computer? You may want to call your own plumber. If you do call in a claim, answer all the questions honestly and do not provide your own diagnosis as you may be causing problems for yourself. Remember, many home warranty companies log everything.

For many home warranty companies, it is easier for them to deny anything not clear and hope you will not escalate or complain. If you feel the item is covered, ask to speak with a supervisor or what your means of escalation is. Make sure you understand that if you have the item fixed on your own without approval, the home warranty company may not reimburse you. Consult your home warranty contract.

ALWAYS be nice and professional when you are talking to the home warranty service folks on the phone. They are just doing their job. Keep in mind the home warranty company is not charging a lot of money for the plan and MANY people try to take advantage of them. We can tell you from experience, that being nice to people in general will get you amazing results. Remember, everything you say may get logged and the next person you talk to will be looking back at the history records.
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[xa_slide title=”Gotcha #21: CAN YOU ADD COVERAGES IN THE FIRST 30 DAYS?”]Did you know that if you are buying a new home and purchase a home warranty plan as part of closing escrow that many home warranty companies have provision to add additional coverage’s within thirty days of plan inception? This is a MAJOR benefit to a plan. Most home warranties are thrown in at the close of escrow and the buyer has no idea what they purchased. Another case is many people buy homes on emotions and really do not know what is in the house until after they move in. Are you one of them?

Let us worry about getting you the right home protection plan and we will free up your time to focus on your new home.
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[xa_slide title=”Gotcha #22: IS YOUR HOME WARRANTY AN INSURANCE PRODUCT?”]For a home warranty plan to be considered an insurance product, it must be submitted to and approved the Department of Insurance for that state in which it is to be sold. To our knowledge, most home warranty protection plans are not insurance products. The one benefit of a home warranty plan approved by a Department of Insurance for a state is that you, the consumer, has an avenue for complaints. Let also be clear, the Department of Insurance in most states take insurance products seriously.
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[xa_slide title=”Gotcha #23: What is the warranty period on a repair?”]Review your contract carefully. In most cases, you get a 90 day warranty on parts and 30 days on labor. On day 31 you pay the service fee again if the warranty company has to send someone out.
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[xa_slide title=”Gotcha #24: IS DAMAGE CUASED BY ROOTS AND FREEZE COVERED?”]Once again, check your contract very carefully and you will find in most cases that any damage caused by a root or freezing conditions is excluded and not covered.
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[xa_slide title=”Gotcha #25: IS MY ABOVE GROUND POOL COVERED?”]In many instances you will find that above ground pools are covered. Normally the heating and filtration components are covered. You will usually find that the liners, covers, fill valves, and underground components are excluded.
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[xa_slide title=”Gotcha #26: IS THERE MORE THAN ON PAYMENT PLAN?”]To be competitive, many warranty companies are now offer 1, 3, 4, 10 or 12 payment options. To help keep costs down, many prefer credit card transactions and will bill you based on the payment option you select.

If a company does not offer payment plan options you should ask why and consider the answer carefully before signing up.
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[xa_slide title=”Gotcha #27: IS THERE AN ANNUAL LIMIT ON YOUR PLAN?”]Most plans do not have plan limits, however, most do have limits on specific items. For example on steam boilers you will usually find a $1,500 limit. Check the policy fine print and ask questions if you have a item that is not standard in most homes.
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[xa_slide title=”Gotcha #28: MY HOME HAS A STEAM BROILER AND RADIATORS FOR HEATING ROOMS?”]The cost to replace a steam boiler can start at $2,500 so many people buy a home warranty for this reason alone. You will usually find steam boilers in home from the 1930’s – 1960’s.

We recommend before buying any home warranty, call the company to make sure you understand what components are covered and their limits if any. In our experience, we find that if a home warranty company does cover a steam broiler, there is usually a $1,500 limit.
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[xa_slide title=”Gotcha #29: ARE GALVANIZED PIPES COVERED?”]We have yet to run into a home warranty company that does cover them. Let us know if you hear of one.
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[xa_slide title=”Gotcha #30: WHAT DO I DO IF A CODE VIOLATION IS DISCOVERED?”]Besides a building violation discovery, you may also run into problems it the building codes have also changed since the home was built.

Code violations are not covered. A common example is electrical wiring not installed to code. For example, on romex wiring splices in an attic, instead of using a junction box, someone used black tape.

On the other hand, if you have a covered item, but new building codes require additional parts, you will usually have the option to pay the service technician for the additional parts. The perfect example is older home may not have an earthquake strap on a water heater. If the water heater goes out, a service technician may be required by new building codes to install an earthquake strap. You may be responsible for the strap and the home warranty company will just replace the hot water heater.

Is some cases, the home warranty company may just cash you out. You then can work to bring required components up to code on your own.
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[xa_slide title=”Gotcha #31: ARE SHARED WELL PUMPS COVERED?”]Shared well pumps are generally not covered! If you do get a home warranty thinking that your shared well is covered, you may get a shock when a technician comes out to work on your well pump and notices multiple lines and coming out of the well pump. They may tell you it is not covered under the home warranty.
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[xa_slide title=”Gotcha #32: ARE WATER SOURCE HEAT PUMPS COVERED?”]This is an area you really need to check the home warranty contract carefully. Almost every home warranty company excludes water source heat pumps.
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[xa_slide title=”Gotcha #33: WHAT IS THE LIMIT TO FIX A WELL PUMP?”]To keep it simple, a home warranty company will usually pay the maximum stated in the home warranty contract to remove the pump, diagnose it, repair it or replace it. For the best results, ask the home warranty company for the limits.
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[xa_slide title=”Gotcha #34: IS ALUMINUM WIRING COVERED?”]Coming Soon…
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[xa_slide title=”Gotcha #35: ARE SEPARATE STRUCTURES COVERED?”]Coming Soon…
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Legal Information

Below are some of the most common issues that new home warranty plan owners may encounter. You cannot fault home warranty companies, as they do a great job in their home warranty plans/contracts explaining what is covered and what is excluded. Our only complaint is that the type in the contract is so small that you need a magnifying glass to read it.

[xa_acc style=”xa-blue”][xa_slide title=”COPYRIGHT INFORMATION” openclose=”” icon=”Select Icon—“]The information on this page is the intellectual property of HomeWarrantyExperts.com and should not be copied, reprinted, or curated without the express written consent from us. Please contact us for more information. We use www.copyscape.com to verify infringements.  If you are aware of any Copyright infringements, please let us know so that we can preserve the integrity of the information we provide to you our visitors.[/xa_slide]

[xa_slide title=”DISCLAIMER”]The information is this web page is for informational and educational purposes only and we offer no guarantee on its validity as it may apply to any new or existing home warranty contract. As you read this, please keep in mind that all home warranty companies are not created equal! Each home warranty company has their own unique strengths and weaknesses.  Consult your warranty contract or look at the one you are interested in for the exact details on included and excluded items. These gotchas are presented to help you ask the right questions and help you avoid a future “NOT COVERED RESPONSE”. These are our opinions and experiences shared with us by our visitors. Whenever you are unsure or have special needs, ALWAYS consult the contract before purchasing.[/xa_slide]
[xa_slide title=”NOTICE USE INFORMATION AT YOUR OWN RISK”]HomeWarrantyExperts.com does not guarantee, underwrite or approve contracts, or services provided by any vendor herein. Purchaser assumes all risks of any warranty purchased. Homewarrantyexperts.com assumes no risks for any of the content on any of the sites that we link to or that link to us.
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