Home Warranties? Any Good?

[Dale00]

I have no experience with these, but Clark Howard is very negative:

Home warranties aren't worth the paper they're written on, but that hasn't stopped homeowners from buying them by the millions. Nor does it negate their effectiveness as a tool you can use to sweeten the pot if you have to sell your home in a tough market.

A few years ago, The Chicago Tribune reported that 3 million homeowners bought home warranties during one 12-month period. Yet at the same time, for six years running, home warranty companies have led a list of the most complained about companies in America out of 500 different categories tracked by AngiesList.com.

This is a profession that shames itself every morning it gets up. The industry as a whole is really more rip-off than out-and-out scam, but there are certainly some scammy players populating it.
Here's why home warranties aren't worth the paper they're written on

With a typical home warranty policy, you pay anywhere from $400 to $600 annually. In return, you supposedly get peace of mind when one of the mechanical components of your home breaks. But in my 24 years on the air, I've never taken a call where the warranty was a good thing. It's almost always a bad thing. You pay for peace of mind that is a mirage.

Here's how it plays out in reality: If something goes wrong in your home, the warranty companies are brutally difficult to deal with. They require you to use their contractor only. That contractor may or may not come on schedule while you're burning up in the heat of summer without AC or freezing in the dead of winter without heat. And then you've got a deductible on top of that!

http://www.clarkhoward.com/home-warranties-not-worth-paper-theyre-written#disqus_thread

 

[BuckFuller]

We had American Home Shield for a while. They replaced a hot water heater (with a deductable) and then we paid them for like three or four years without a claim... then we had an issue with our service box for the AC unit... and they wormed out of paying anything on that... and then we had something else break and again they wormed out of paying for it so we dropped them. In the long run we would have been better off just buying a new hot water heater. My experience for what it is worth.

 

[Crusader8207]

Ours is with Old Republic. Our per-incident callout fee is like... $75? Or something. We've found enough stuff that has gone wrong in our older home to at least pay for the annual fee each year. Recently replaced our old old dishwasher - they paid about $450, we added a coupla hundred to it and got something nicer than they were gonna put in. Also replaced the A-coil on our old AC unit, plus all the freon - they've had to put freon in twice a year for the last 3+ years, so that alone almost paid for our premium. We did have to pay an extra portion on that one. Maybe a coupla hundred max.

If I had a new home I would say you shouldn't need it, but then, everything is crap these days, old or new.

Personally, I'm a believer.

We have Old Republic too. Our house is 15 years old and we bought it 4 years ago. In that time, Old Republic has replaced our water heater ($750), dishwasher ($650), and garage door opener($450). $75 service fee as well and I pay $61 a month for the warrantee.

 

[toehanus]

Never had one. Have some friends with one and it took a month to get their ac fixed. If you are able to do a lot of stuff on your own, I'm not sure it would be worth it.

 

[JD8]

We have Old Republic too. Our house is 15 years old and we bought it 4 years ago. In that time, Old Republic has replaced our water heater ($750), dishwasher ($650), and garage door opener($450). $75 service fee as well and I pay $61 a month for the warrantee.

4 years @ $61 a month = $2928 plus service fees?

total payouts for policy...... $1850

Just sayin.

Only experiences I've seen were meh to negative. One needs to make sure they read their entire policy if they go that route.

 

[Dale00]

It's insurance - only buy insurance for losses you cannot otherwise afford to cover.

 

[n423]

Never had one,so I can't say...

 

[Eric_Williams]

We use AHS on our current house and our old house. We have gotten a heater, hot water heater, blower motor and had our condenser rebuilt. The part that got us was the fact that it is the homeowners responsibility to pay for something to be brought up to code i.e. The gas line for our heater. The warranty is only as good as the company they send out and yes you actually can request a specific company to come out as long as they are approved.