ACTION JACKSON: Things you should consider before purchasing a home warranty policy

Updated: Feb. 8, 2021 at 5:59 PM CST
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BATON ROUGE, La. (WAFB) - Sandy Stacker says she purchased a policy with a home warranty company in 2020. The company is now refusing to pay for the parts to repair her central heating system; although, she claims that was part of their contract agreement.

“Why for me to send you $40 a month and then give $85 trip charge for you to tell me what’s wrong with it and then I still have to buy the parts.”

Action Jackson called the home warranty company to see why they denied Stacker’s claim. A representative told Jackson the damaged parts to her heating system did not fall under the company’s normal wear and tear policy. She will now have to pay out of pocket if she wants her central heating fixed.

“It is by the grace of God that I do have a roof over my head because some people are still struggling, but the cold, I feel it,” said Stacker.

Stacker is not the only homeowner facing this dilemma. Carmen Million with the Better Business Bureau says her office receives tons of complaints about home warranty companies, which usually arise when a claim is diagnosed as a “pre-existing” condition or the homeowner failed to maintain or service their unit. She left me a few tips too.

- Research prospective providers before you purchase. Check with the BBB for a free review of the company’s business and complaint record.

- Verify licensing. Contact Louisiana Insurance Commissioner to ensure the company you plan on purchasing a policy from is licensed with the Commission.

- Read the contract thoroughly. While it is easy to gloss over the fine print and dismiss it as indecipherable nonsense, remember, it is difficult if not impossible to argue the contract is unfair or unenforceable after you’ve signed it. Ask plenty of questions about what is and is not covered and make sure any verbal promises made are reflected in the contract.

- Consider the deductible. The industry average is $50 to $100 per claim. But some companies charge as much as $150 per call.

- Ask the company who will perform the repairs. Most warranty companies have their own network of service contractors. If this is the case, make sure you research contractors as well. However, some do allow you to hire a contractor of your choice. Be sure you understand the company policy before you buy the service.

-Is it worth the cost of purchasing a home warranty? Consider creating a “rainy day fund” dedicated to dedicated to home repairs.

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