[NA] Do you use a home warranty?

SixPapaCharlie

SixPapaCharlie

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I have had one for 6 years and I have been under the impression that it has been good to me.

New Microwave, 3 pool pump motors, garage door spring, dryer repair, new oven, multiple A/C repairs, and a hot water heater ( I had to contribute $500 for that).

As I sit here in my 80 degree house once again waiting for someone to send a tech out, I start adding it all up.

$65 / month for 6 years = 4680
Hundred dollar trip charge for every visit.


So looking at a pool motor which costs about $180, I feel like I am only paying the $100 trip fee but in essence the monthly charge blows past $180 quickly.

I understand AHS isn't ever going to completely replace an A/C system and that is really what we say we need it for. If the AC dies, we want that covered. Realistically I think they are just going to repair and repair and repair which is fine but that is the same situation as the pool motor.

I think maybe they are a waste of money.

What say you? Do you have one. If so, what is their real value?
 
We had one for one year that the seller's agent threw in when we bought the house. Used it once, but we did not renew at the end of the year. Looking at your math seems to confirm our thoughts. $4680 + trip charges + $500 seems like a lot more than it would have cost to just pay outright for the repairs you've had done.
 
cheap weenie said:
We had one for one year that the seller's agent threw in when we bought the house. Used it once, but we did not renew at the end of the year. Looking at your math seems to confirm our thoughts. $4680 + trip charges + $500 seems like a lot more than it would have cost to just pay outright for the repairs you've had done.
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Yep, me too. Mine's about to end; they're paying $1720 to replumb my house because the builder used the thinnest copper pipe ever made. Plumbers Bill will be 6+ AMU. Homeowners, of course, will not pay anything for "long term damage," but if a pipe busts and it floods, they'll pay for that but still not the replumb . . .

I would never pay both annual and monthly fees for a home warranty, unless it knew I had bought a crappy fixer-upper. But if they will only keep repairing and not replacing things when they wear out, I for sure wouldn't keep renewing.
 
I've never had one but was offered one yesterday on a house I made offer on. Told them nothing probably works anyway and didn't care. Might have the fire department burn down for practice anyway. Built in 1965 but has been empty about 5 years. On the two houses I live in I've never had enough problems to begin to justify a policy. One house has had maybe 4000 in things in 7 years and other house maybe 2000 in 15 years. Don't see how it would pay.
 
The problem is they always take forever to get out to you and they use the cheapest parts. Under a home warranty expect your a/c compressor to crap out every couple of years.

Bob
 
Warranties in general are a bad "investment" unless you don't have the resources to handle one big repair. I never buy extended warranties of any kind.


Like any other insurance product, the actuaries do the math and the odds are tipped towards the seller of the product, not the buyer.
 
I never purchase extended or additional warranties. One's chances of coming out whole or ahead on them is minuscule, sort of like buying lottery tickets, but less fun. Stick the premium into a savings vehicle and use that as your warranty fund, if you feel you need to have one for peace of mind. It'll save you the aggravation and time of having to make a claim and wait for service too.
 
unsafervguy said:
The problem is they always take forever to get out to you and they use the cheapest parts. Under a home warranty expect your a/c compressor to crap out every couple of years.

Bob
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This.

We had a standard warranty that came with the purchase of our house. If something didn't work, you had to call their hotline and hope and wait for a service person from some off the wall outfit to show up. And then we started finding out the limits on repairs. For example, the home we bought came with a Sub-Zero fridge which died a couple if weeks after we moved in. The warranty dud the cover it. Only covered the basic cheap 'Best Buy' type appliances.

Needless to say, we did not renew.
 
Only when it's gifted by the real estate agent.

The deductible and trip fee alone makes a home warranty a waste of money generally.
 
Fearless Tower said:
This.

We had a standard warranty that came with the purchase of our house. If something didn't work, you had to call their hotline and hope and wait for a service person from some off the wall outfit to show up. And then we started finding out the limits on repairs. For example, the home we bought came with a Sub-Zero fridge which died a couple if weeks after we moved in. The warranty dud the cover it. Only covered the basic cheap 'Best Buy' type appliances.

Needless to say, we did not renew.
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No kidding about the off-the-wall outfits. The one time we used ours was right after we moved in and noticed the AC wouldn't keep up in the heat of the day. My wife was home alone and they sent out some real geniuses who spent half an hour looking at the air handler in the attic (?) and then told my wife that her having lights turned on in the house was making it hot, and they told her something was probably wrong with the brand new filter I'd installed, so they got the old nasty one out of the trash and put it back in, collected their money, and left. To AHS's credit, after I reamed them a new one for that charade, sent out a very competent guy who found the problem in 2 minutes (the condenser was clogged with grass etc, he showed me how to rinse it out as needed) and refunded my trip fee.
 
Had a 2-yr warranty that came with house when purchased. We only used it once to get the heater serviced when it went dead in the middle of winter. $100 later it was fixed, and they had a total bill of $600 or so. I don't feel that they are worth it unless you know there are a ton of items (water heater, fridge, HVAC, etc) on their last leg and you don't want to worry about eating the replacement cost in the first year or two. Otherwise, it's smarter to just pay the warranty premium on repair/replacements instead of a contingency plan.


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Mathematically, the odds are always in their favor, otherwise they wouldn't be in business anymore. So by definition they aren't worth the money in the big picture.

Does that mean that occasionally someone doesn't come out ahead with one? Of course not. Just like the lottery. Someone will win but most people lose.

They aren't worth it in the grand scheme of things.
 
In 20+ years, the only appliances I have had replaced are the well pump and the hot water heater. Everything else; fridge, stove, dishwasher, washer, dryer, furnace, have been bulletproof. I have had garage door springs replaced twice, and the garage door opener replaced once. A home warranty would have been a bad idea for me. My builder was a one-man show and it seems as if he gave me a one-year warranty with the house, but there was no option to extend it, at least not that I can remember.
 
I don't have A/C in my home, so I don't have to worry about that cost....:)
 
We had one for two years when we bought our house...seller paid the first year, and our finances were a little tight. Gave us peace of mind in case the furnace or AC died, both of which were 20 years old.

We've saved up cash for replacements, so we canceled the policy.

The couple of times we used them, we weren't at all happy with the contractor. Our furnace motor went out, and the home warranty folks didn't have a problem with my family not having heat for a few days in January...we found someone else who could come out that day and paid the bill ourselves. (He's now our go-to heating/cooling guy).

I would only recommend it if your finances are tight enough that you need it...save up as quickly as you can so you can cancel it. unless you have a couple of big ticket items fail early on, you'll probably never come out ahead financially with a homeowner warranty.
 
It's nice to have a warranty when you move in, so you don't have to worry about issues while settling in and learning your way around.
 
If my well pump breaks, I want a particular well company to replace it with a specific pump. I don't want some no-name outfit from three counties over come and plow up my yard to install whatever is on sale at home Depot this week.
The prior ownners oof my house had an AHS warranty. They gave me stacks of invoices and trip fees from 5 different outfits who couldn't get the geothermal heat pump to work right. One trip by 'Big Eddie' the guy who had installed it when the house was built and we had the issues sorted out in short order. Home warranty means that you get the lowest bidder contractor to install the bottom shelf equipment. If that is what you want, then a home warranty may be right for you.
 
You have no say in how they repair something or what they replace it with, and if you're in an emergency situation (no water or no A/C on a 95 degree day) they don't really hurry to get to you either. So, if you're planning on being in the house for a long time and want to make quality repairs, look at it long and hard first. However, it can save you some money if you're okay being out of the decisions on what to replace stuff with, but it will likely be contractor grade quality (i.e. the cheap stuff). Also look at the fine print. I recently had a water heater problem. House has 2 water heaters and they both started leaking within the same week. Both had to be replaced. Home warranty only covered one -- for whatever reason, my policy covers two A/C units but only one water heater. Oversight on my part I suppose, and the extra coverage for the 2nd water heater would be about $35/year, but it was too late to add it with a pending claim open. Also look to see if your policy covers "code upgrades" -- in my case they had to add an expansion tank and a new style gas valve to comply with building codes, and that cost me about $700 out of pocket because I didn't have code upgrade coverage.

The policy did save me some money, but not as much as it could have. Read the whole thing and make sure you have coverage for all your home's appliances and the extra "code upgrades" coverage, if you're going to have a home warranty policy.
 
There's very little I won't fix myself or learn how then do it, so no. Wouldn't be worth it.

Also just in general I don't buy service plans, I think they're a rip-off unless you get lucky.
 
16 years, and I've replaced a furnace ($$$$$$), well pump ($), and fridge ($$). I'm way ahead by not having bought any warranties, and just paying out of pocket when it happens.
 
12 years in this house and have replaced: 1 boiler w/sidearm hot water tank, 1 refrigerator, 1 washer, 1 dryer and replaced the pump & motor on the dishwasher. I upgraded all the appliances. I did the work myself on the boiler/water tank while upgrading the system to comply with code and deal with water main pressure >100 psi. A warranty would have left me with repaired appliances which would have been okay...sorta. Some licensed/insured folks refuse to repair heat exchangers on boilers even though it is a relatively simple task. I repaired the heat exchanger initially to get me by while researching/planning the replacement. I did install CO detector for peace of mind though.
 
Nope, I also notice many people forget that lots of stuff has a existing warranty on it.

Scored a great "broken" LED TV off Craig's list that was still under warranty, bought it for next to nothing, called in the warranty, not only did they send me out a new TV, I kicked in a little over a hundred bucks and got a few models up.
 
We had a warranty included when we bought our house a year ago. We used it for one squawk (bad light fixture in one of the bedrooms, but it was a bit of a hassle getting the warranty company to approve a local contractor to fix it. We didn't renew it when it came up for renewal.
 
The general rule with optional (as opposed to those required by law or by your lender) insurance/warranties is that you only pay to cover incidents that you couldn't handle an eventual claim otherwise. I'd not take out a extended (or home) warranty to cover appliances as while it would be inconvenient to fork over a few hundred to replace the unit, it's not going to break me.

As Homer Simpson said after being lobotomized with a crayon: "Extended Warranty? How can I lose?"

All insurance is statistically rigged for the insurer as pointed out. The question is whether you can handle the variance over the long run.
 
Both this house and the last house had a 1 year home warranty included with the sale of the house. In both cases, it's paid for something. However we haven't opted to renew it.

If they didn't overall make money on home warranties, they wouldn't sell them. AHS is a business, not a charity, so you know that on the whole they're making money off of you.

I would drop it.
 
IMHO these policies work for people who don't have reserve cash for problems that might arise. Paying monthly, is simply a premium for having peace of mind. If you have access to emergency cash (even a credit card) you don't need it. Put the $65 in the bank.
 
Been a homeowner for 25+ years (2 houses). Never used a warranty service.

I've replaced and repaired a lot of things over the years, but nothing that would have made up for deductibles and premiums. And I can call the contractors I want to, rather than take the one that's sent.

Maybe when my A/C died, it might have helped, but based on the age I don't know if it would have even been covered (I don't know how those kind of warranties work).

I used to get mailers a couple times a year, but haven't seen one in a long time. I DO get mailers from the water company wanting to sell me insurance in case of a broken water line between the meter and the house -- "It could cost thousands to repair!!! Get our warranty and you'll never pay if this happens to you!!!"
 
Matthew said:
Maybe when my A/C died, it might have helped, but based on the age I don't know if it would have even been covered (I don't know how those kind of warranties work).
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My recent home warranty experience with AC was that they wouldn't cover replacing the whole unit. They eventually replaced what was wrong, but spent a lot of time trying to upsell me on a new unit (which "discounted" was still close to 5 figures).

That's part of why home warranties don't make sense to me. They'll "protect" you from incidentals, but not from catastrophes. Compare that to aircraft insurance that will make you whole in the event your gear fails to come down, which is a no-brainer.
 
Ted DuPuis said:
My recent home warranty experience with AC was that they wouldn't cover replacing the whole unit. They eventually replaced what was wrong, but spent a lot of time trying to upsell me on a new unit (which "discounted" was still close to 5 figures).

That's part of why home warranties don't make sense to me. They'll "protect" you from incidentals, but not from catastrophes. Compare that to aircraft insurance that will make you whole in the event your gear fails to come down, which is a no-brainer.
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I remember your A/C adventures.

I opted to upgrade, rather than repair (again), an old and inefficient unit that probably was undersized from day one anyway.
 
No. Ripoff.

AHS denied an AC claim in San Antonio claiming "poor maintenance by the prior owner" (uh, no, and we even had the system inspected prior to moving in with no problem found). And it took them over a week in 95+ degree temps to even come out.

Real estate agent here was surprised when I turned down the "free" AHS "warranty" (prepaid service contract) and asked for a credit against the purchase price instead.
 
We had one the first year after we bought the house. The only thing it ended up being used on was a water heater. At first I thought I had come out ahead, but looking back, I replaced the water heater with a similar one when, if I had to pay myself, I would have gone a larger tankless system that would have been far superior and marginally more.
 
Like others have said, you have no control over what they use to fix anything. A couple of years ago one of our A/C units failed again and we replaced it with a high efficiency Trane unit. The new unit came with a 10 year warranty, and is saving us about $500 per year in electricity, which will more than pay for itself over its lifespan. If it had been covered by a home warranty, they'd have patched up the old one and our electric bill would have been much higher, and it would probably have broken down at least once since then.
 
Matthew said:
I remember your A/C adventures.

I opted to upgrade, rather than repair (again), an old and inefficient unit that probably was undersized from day one anyway.
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We looked at that option as well, for which the warranty ended up being an even worse deal. The system was higher end when it was installed (~10 years ago) so unless we spent a bunch of money, we weren't going to gain much efficiency. In another 5-10 years when it actually does need to be replaced, the SEER ratings will probably get that much better.
 
wsuffa said:
They will hound you for months....
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I'm still getting notices to renew the home warranty that expired on a home I don't even own anymore.
 
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