Are home warranties worth it? That's a question we get a lot, but answer the comes down to numbers.
Expect to pay anywhere from $300 to $500 per year for a warranty plan, even more if you want to cover things like your pool. You'll also be responsible for a service call fee of $50 to $75 each time a contractor comes out for a repair. The exact amount should be in your contract.
That could be worth the price if the repair value is more than you paid for the warranty. If not, you could have put the money in a savings account until you needed it.
Every warranty has exclusions — some that you wouldn't expect. For example, it may cover the air conditioner, but not freon which is very expensive. So find out what the exclusions are before you buy.
If an item can't be repaired, be prepared to fight for replacement if your policy allows for it. Have invoices and maintenance records ready to prove that you maintained the unit.
Also, some policies only reimburse a certain amount toward replacement so figure out what that is before you agree.
Often warranty companies contract with specific businesses, so if you are at their mercy. But while making the call for help, get the names of the businesses that are in the rotation. Look up reviews while you are on the phone. If they don't look good, request a different company. Also, call the company yourself to make sure that they got the work order and to get a better time frame for when you can expect them.
Not happy with the service? In Arizona consumers can cancel the contract and get a prorated refund for any reason. Find out about more protections here.
Warranty companies must also have a permit to write contracts in Arizona so check with the Arizona Department of Insurance to see if they are working legally. You can also file a complaint with them if you believe the company is not living up to the contract.
The most important thing you can do is do your research. Look for reviews, check for actions against them in other states and check the Better Business Bureau for complaints.
