If you sign up with a home warranty company to help take care of major appliance or system failures in the home (such as HVAC replacement or plumbing issues) you can expect to pay around $300-500 per year. When you read the details of their agreement –and some of these companies don’t let you see the terms of the agreement until you give them your information to request a quote– you’ll probably see information such as “(Company name) has the sole and absolute right to select the Service Provider to perform the service”. Which means you will not be authorized to make a claim if you have a preferred company. You may not even know for sure that the warranty company’s technician is licensed, bonded, or a factory authorized dealer. Most of the warranty companies charge a “service call fee” ranging from $60 per call and up – meaning, they don’t allow you to make the call to the company you might prefer, but charge you to contact the service technician that they have chosen.
Here at Star Heating and Cooling, we had a call recently from a customer who was paying $130 a month for a home warranty. The company would not cover the cost of a clogged condensate drain (the drain that removes condensation from an air conditioner), so the customer was requires to pay the charge out of pocket. Another customer of ours needed emergency help and was referred by his home warranty company to a serviceman who delivered what he considered low quality work. To complete the job to his standards, the customer reluctantly decided to pay for the repairs out of pocket and select the service provider of his choice.
A report by Angie’s List says that home warranty companies are among the poorest rated companies in their system; nearly half of all of the reviews written on their site about these companies are negative. Some of the most common complaints include:
- lack of coverage on things the homeowner thought would be under warranty
- delays on reimbursement up to several months on repairs done by a technician of the homeowner’s choosing, or when the warranty company could not find anyone on their regular list of providers willing or able to do the job
- some companies will not renew with you after you have filed a major claim
- The service providers authorized by the warranty company have up to two weeks to respond (can you go without heat in the winter for up to 2 weeks?)
Star Heating and Cooling is licensed and bonded, and is a factory authorized Carrier dealer (though we work on any HVAC brands). So if you would prefer to work with a HVAC company that has been screened by the manufacturer rather than by the warranty provider, home warranties may not be the best choice for you. If you have a preference for the company who works on your heating and cooling system, you may just want to create a separate savings account that you add to each month to take care of major household emergencies instead of committing to a home warranty.