According to CBS Chicago, “…it feels like every week CBS 2 hears from a viewer incensed over a home warranty issue.” Which brings us to our questions for the day…
Are home warranty policy providers trustworthy? What are the pros & cons of even having a home warranty policy? And, is it really worth it? Learn more below as we pick apart the home warranty industry to give you the unadulterated truth.
What Are Home Warranty Policy Providers?
Before we go further into our official ‘breakdown’ let’s talk about home warranty policy providers first. Home warranty policy providers are exactly what you think. They provide home warranties for their customers. It really only gets tricky when you start defining ‘home warranties’ themselves, which, while very similar to home insurance policies, are not quite the same.
To put it very simply, however, we’ve compiled a list of the main characteristics of home warranties:
- Covers Major Home Appliances & Systems
- Covers damages as a result of natural wear and tear
- Charges Annual/Monthly Premiums & Trade Service Fee ($60-100) per repair
- DOES NOT cover damage caused by fires, natural disasters, vandalism, etc.
- DOES NOT cover poorly maintained home systems or appliances
If you’re confused by anything mentioned above, then you’re rightfully so.
Home warranties are tricky to understand. But, the truth remains — there are plenty of people who have saved thousands of dollars, and in some cases, even tens of thousands of dollars, because of home warranties. And, this is despite the complexity of home warranty contracts.
Alright, so, if it’s not the home warranty policies themselves that are making these policy providers untrustworthy, then, what is?
We may be able to find the answer to that by answering this next question.
How do Home Warranty Policy Providers Work?
To answer this, we’ll be explaining the process of signing a home warranty contract and the process involved with working with one of these home warranty policy providers.
For this example, we’ll be using Total Home Protection for our ‘sample’ policy provider.
It starts off easy. Signing a contract with Total Home Protection is as simple as heading over to their official website and applying for their service through an online form or their toll-free 1-800 number. For this step, you will be talking directly with a representative that will help you choose a plan and contract that is suitable for your home and budget.
Once you have your Total Home Protection home warranty policy in-hand, you will then be able to place claims for the repair and the replacement of covered home appliances and systems.
Which brings us to the part of the process that gets a little messy — and is the cause for most of the negative outcry against home warranty policy providers on the internet.
You see, in order for policy providers like Total Home Protection to get your repairs and replacements in order, they must first coordinate with technicians and contractors that can handle those repairs and replacements.
This extra step has led to many delays, and thus, much outrage from homeowners. Something that is especially prevalent this year, as COVID-19 has left a lot of contractors unable to work away from their homes. Which, ultimately, brings us to our answer.
The Bottom Line: Are Home Warranty Policy Providers Trustworthy?
So, what’s the big deal? Why are home warranty policy providers getting so much heat lately? They’re not inherently untrustworthy. But, it does seem that there is a big issue with their methods — especially with COVID-19 and the worldwide implications thereof.
Fortunately, many home warranty providers are now working on improving their methods. Even the home warranty policy provider we used as our example above, Total Home Protection, has had to work out some kinks in their claims processing several times to make sure that they are providing the best service possible.
This is according to Total Home Protection’s founder and CEO, David Seruya, who, in a recent interview, released the following statement: “At Total Home Protection, we are currently working on new AI technology.” And explaining that this new AI technology will help the THP team ensure that they are providing “…the highest standard of customer experience for our policyholders by minimizing the risk of human error, expediting our process exponentially, and providing more transparency on how we do business.”