Home warranty customers complain loopholes are stopping coverage
Have you ever had the AC go out? Or the water heater?
Home repairs can really add up, and replacements are even more costly.
Home warranty plans are meant to help cover these expenses, but some local customers have discovered their coverage isn't protecting them as expected.
Raynor Smith, for example, called his home warranty company this past summer when his AC stopped cooling. He thought his home warranty would cover the replacement of a new HVAC unit.
They sent a local repairman to take a look – and his exact words shocked Smith.
"His exact words were, `I will send a report into the company. It needs to be replaced it's, you know, it's done. They should replace it, he said, but they won't.' And I laughed, you know, he's kidding," said Smith.
Select Home Warranty denied his claim – saying the unit was installed incorrectly.
Smith called Select Home Warranty again.
They said, according to Smith, "As long as it's running, we don't have to cover it."
"It's running, but it isn't working," explained Smith. "I think that's ridiculous."
Smith asked Select Home Warranty for a copy of the report from the repairman – but they said they couldn't give it to him.
"They said, `we can't give it to you. You're the one who paid him the $45 to come out. So therefore you can only get it from him.' So I called him (the repairman), he said, I can't give it to you. The company tells me not to give it to you," said Smith.
Home warranty complaints are growing
A home warranty is different than home owner's insurance. It's more of a contracted service agreement where you pay a set price for the repair, and sometimes more.
One estimate shows the number of warranties purchased by homeowners nearly doubled in the last 10 years.
Growing, too, is the number of complaints into 5 On Your Side.
The common issues: delays and denials.
One viewer requested service and "...had to wait over 2 weeks."
Another told 5 On Your Side: "I'm getting no timeline on when the repair will be done."
One person says they "... Filed a claim twice. No one called or showed up"
And still another wrote "...their claims department was denying coverage for the water heater because it was a result of 'secondary damage.'"
WRAL's 5 On Your Side talked with North Carolina Attorney General, Josh Stein, who said, "A lot of times the companies are very aggressive at excluding coverage."
His office had 177 complaints in 2019, and so far in 2020, 180 complaints about home warranties.
"They're not small-dollar items," says Stein. “You know, you could spend $750 to $1,000 a year on one of these warranties," said Stein.
Stein suggests: Before you spend that money, read the warranty.
"What are the limitations? How long does it last? Are there certain restrictions as to what type of materials can be used?" he said.
Is coverage capped or pro-rated, as Smith found with a previous claim.
Smith says his warranty company told him "no problem" with a claim.
"And I thought, you know, I was getting the microwave replaced. Well, they sent me $40 to get a new microwave," said Smith. "But their contract does have things all written in it, like, you know, if you breathe at night, we can't cover. You know, if your wife happens to go out for have a hair done, we can't cover that machine. No, not that bad, but pretty close."
When asked what he feels he's getting for his home warranty, Smith says: "Nothing."
5 On Your Side reached out, multiple times, to Select Home Warranty. We did not get a response.
