Common Policies and Practices Used Against Consumers
With the exception of Advantage Home Warranty, the inner workings and structure of the home warranty industry is stacked against the policy holder. With loopholes large enough to drive a Mac truck through, they need NEVER pay out any claim.....and you the policy holder can do little about it.
This describes how the home warranty industry builds convenient loopholes into the system to avoid paying claims and how it should work.
Been Burned by Your Home Warranty Company ? Find Out How to Avoid Being Ripped Off !A TARNISHED REPUTATION
A lot of Realtors offer home warranties to their clients, But many may not know that the credibilty of the home warranty industry is tarnished in the eye of the public. And for GOOD REASON. The whole business model is intentionally flawed in their favor. But first, a little background......
CREDIBILITY GAP
There is a HUGE problem in the home warranty industry, and the public is becoming savvy to it. But the days of an ignorant public being preyed upon by an industry lacking integrity is nearing an end. Information is just a click away.
DO A BACKGROUND CHECK
Anyone considering purchasing a home warranty should 'Google' that company's name and the word `complaints', rip-off or `fraud'. Find out how many people believe they got burned, turned down wrongfully or got rotten service..... here's one site that should keep you busy: http://www.my3cents.com/. THERE ARE MANY OTHERS.....
WHY SO MANY UNFAIR DENIALS ?
The problem is INHERENT TO THE MODEL on which MOST home warranties operate. Here's why:
THE NO-DOCUMENTATION HOME WARRANTY and the 'PRE-EXISTING CONDITIONS' clause
If you (as a homeowner) call up a home warranty company, and ask them how they can warranty a house they have never seen or had inspected, they glibly tell you they take your word for it.
But here's the sad truth : They do not want documentation ! That would eliminate the loopholes they depend on to avoid paying out on claims!
Think of it this way. How many health insurance companies will insure you without a physical exam ?
The fact is, 99% of home warranty companies do not ask for or even accept documentation as to the serviceability of anyone's home or it's warranteeable components, which creates a HUGE LOOPHOLE. This allows the warranty company the option of rejecting the claim based on the convenient ' PRE-EXISTING CONDITIONS' clause or the 'IMPROPERLY INSTALLED ' exception or the 'GOSH, WE JUST DON'T WANT TO PAY YOU TODAY' excuse.
ANATOMY OF A SET-UP
....but when it is time to file a claim the poor policy holder will find it is his word against the home warranty's service technician.
And the homeowner will ALWAYS lose if the technician finds a 'pre-existing conditon' or other unexpected situation, because the warranty company always sides with the word of their technician!
And Harry Homeowner has no recourse, because even if he has documentation that it wasn't a pre-existing condition, the helpful home warranty company will not accept it.
KEEPING IT CONVENIENTLY VAGUE
BUT THAT IS EXACTLY WHAT SHOULD BE REQUIRED to establish the condition of the home and its systems and to eliminate the excuse of the 'pre-existing conditions clause.
Documentation would show that there were no pre-existing conditions, there were no improperly installed or sized systems........
.........but the warranty companies don't want documentation. That would eliminate the opportunity to take your money and later deny your claim !
WHO GETS HURT IN THE LONG RUN ?
However, Realtors who sell them the rotten warranty product will loose a future referral. To be fair however, there has not been an alternative home warranty product available until now...
See my description of the way Advantage Home Warranty does business down at the green logo !
Home Warranty Research Checklist
Questions You Should Ask A Prospective Home Warranty Company
1. What is the percentage of claims that your company pays out on annually ? (Don't accept dollar amounts, they don't tell you anything about how many claims were denied).2. When ordering a warranty, what do you require regarding the state of my home to verify everything is in working condition and properly sized, installed, etc. ?
3. Do you have a 'pre-existing conditions ' clause in the contract ?
4. If there is a pre-existing conditions clause, do you require a home inspection to verify the presence or lack of pre-existing conditions ?
5. If I have a claim, and I have no documentation to prove otherwise, how can I prove that a condition was not pre-existing ?
6. What if the service tech you send out says my claim is denied due to a pre-existing condition but I disagree because I know that the item was working when I orderd the warranty or that I maintained it properly ? Who's word will you go with ?
6. Do you give kickbacks (commissions, referral fees, any monetary compensation) to Realtors ( or their regional brokers), who refer your home warranty ?
New YouTube vids
Realtors on the Take
Could Your Realtor Be Hooked on Kickbacks for Selling You a Worthless Warranty ?
And now, my dear friends, the plot thickens. Even though there are regulations(RESPA)in the Real Estate Industry against Realtors receiving 'kick-backs' for selling a home warranty, many do.When we began promoting our local Advantage Inspection franchise, we were so proud of our 'No Denied Claims' home warranty that we were sure that Realtors would see the value for their clients as well.
Were we surprised. After 8 mos. of promoting our home warranty and it's benefits to homeowners we were frustrated with the lack of enthusiasm on the part of Realtors who generally make such recommendations.
One Realtor finally said: '_ _ _ gives me $45 every time I sell a warranty. How much do you guys pay ?'
When we informed him we didn't offer $$$ but he could opt into a promotional postcard that we send out to the 100 nearest properties about the house being inspected and warranted, he was not interested.
In fact, I was told POINT BLANK by a Broker in Charge of a very well-known agency here in Greensboro N.C. NOT to bring ANY information regarding our warranty into their office.
Now to be fair to the average agent, even if their agency sells warrantys that offer kick-backs, they may or may not see a penny of that $$$.
Often the head broker, or even a regional broker gets all the cash. And it amounts to a hefty sum.
Legally, each agent is supposed to be allowed to refer their clients to any home warranty company.
However, few feel comfortable to buck the system and they just do what they're told.
So the next time your agent offers you a home warranty, ask them if they or anyone in their company receives monetary compensation for recommending a warranty company.
And while you're at it, ask them if their warranty company has a 'pre-existing conditions' clause or if they require an inspection to document the condition of the home ( like they should ), before they sell you a warranty.
Then enjoy the show....
Advantage Home Warranty
Your Source for the Only 'No Denied Claim's' Home Warranty
THE WAY IT SHOULD BE DONE. Advantage Home Warranty's Approach:-Requires a home inspection first
-Has no 'Pre-Existing Clause'
-Pays all claims on warranteeable items
Advantage Home Warranty is the only home warrany that:
-Realtors can trust with their reputation
-Homeowners can trust with their home
-Has no legitimate complaints about online
Because Advantage Home Warranty requires an inspection by our qualified Advantage Inspection inspectors FIRST, you get the documentation required to establish the existence or non-existence of a 'pre-existing condition'.
If any item does not pass inspection, you have the option to have it repaired and be covered by the warranty, or to not repair it and exclude it from the warranty.
It's that simple. No loopholes, no hassle, No Denied Claims !
And its the way this business SHOULD be done.
For customers in the Southeast, within our present service area, contact Advantage Home Warranty:
1-877-577-4742
Monday - Friday
8:00 am - 5:00 pm
For customers in Greensboro and the Greater Piedmont Triad area, contact me to find out how you can get the only 'No Denied Claim's' Home Warranty on the market, covering more items for a comparable price than any of our competitors !
Philip LaMachio, Advantage Inspection Clear View, Corporate Center Ct. , Greensboro, NC. 27403
Cell (336) 327-5523 Office (336) 369-2173
By the way, feel free to click on the home warranty ads on this lens, but do your research before you consider any of them.
Consumer Beware ! Home Warranty Information
- Home Warranties Not Always What They Seem
- '"Protect your home, save money, and avoid the hassles of home repair now!" began the junk e-mail I received about American Home Shield, one of the largest providers of home warranties.'.....
- My Three Cents
- A site for consumer reviews, with a link straight to the heart of home warranty hell..... A must see for anyone who is about to buy a warranty, or owns one presently.
- Consumer Affairs.Com
- Knowledge is Power.....This site gives you more knowledge about the home warranty
- Article at Home Warranty Reviews
- An article titled ' Annoyances with Home Warranty Policies' with tons of links to other similar material.
'Obviously, with the premium we pay, warranty companies do not make money if they provide the kind of service buyers would have wanted.' - Warranty Firm Probed for Fraud
- An April 1st. 2008 article about a N.J. warranty company that took the money and ran...
- Complaints.com - Home Warranty Complaints
- Read more actual consumer experiences....
- American Home Shield Complaints
- This website is devoted specifically to Terminix complaints but contains complaints of all the companies under the ServiceMaster heading, of which American Home Shield is the home warranty company. This page specifically deals with AHS, but the rest of the site is interesting.
- Complaints Board
- This is a link to the complaints regarding home warrantys, though the general site has complaints about numerous other services or products.
I WANT to hear from you !
Help me make this a better lens. What would you like to see ?
This is your chance to chime in ! It sickens me that the Home Warranty Industry chooses operate in such a way as to leave you high and dry when it benefits them and you need them the most. How about it ?
American Home Shield is the worst warranty provider, they have more excuses than there are clauses in our contract. Most recently they used the "improperly installed" loophole to avoid fixing a legitimate problem. I paid my service fee as required only to be told that the technician reported back that the garage door opener, which we requested service on, was improperly installed and therefore not covered by our warranty. I have videotape footage of the opener apparatus and the alleged swinging that the technician reported is no where to be seen on the video. I see a Warranty company switch in the very near future.
Posted May 23, 2008
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inspector-clouseau
Hello Frank, and thanks: I understand how you feel about 'selling' our warranty. Posted April 02, 2008 |
I was liking your post, all the way up to the point where you turned it around and started selling something. It destroyed your message. It seems more like "oh, he just has something he wants to sell." Do you get a referral or kickback from them?
Posted April 02, 2008
Personal Links
Check out my Advantage Home Warranty, my website, NACHI and my Active Rain Profile and Blogs
- Advantage Home Warranty
- This is the only warranty I would recommend.
Advantage Home Warranty is the only one that WILL NOT DENY CLAIMS on warranteable items based on 'pre-existing conditions'.
In fact, the infamous 'pre-existing conditions clause' is not in their contract.
Hey, with any other company, its their option to reject your claim based on the pre-existing condition. How's your Peace of Mind now ? - Advantage Inspection Clear View
- Our website in Greensboro, N.C.
- NACHI
- The International Association of Certified Home Inspectors, Inc. a non-profit organization helping home inspectors achieve financial success and maintain inspection excellence.
- Active Rain Profile
- Details about me and my home inspection/warranty blogs on Active Rain, a Real Estate Networking website.
Worthless Warranties
How many people out there can feel what I'm saying ?
Lets hear it guys. According to the home warranty industry, anywhere from 75-85% of you have had no trouble getting your claims honored.
Of courst the other 15-25% are simply out of luck.
Are these figures accurate ?
Consumer Fraud
Books on White Collar Crime in America
Home and Garden Stuff
Feather Your Nest....
Your home is a retreat. Make it a place to find relaxation and rejuvenation. If you have kids, start with at least one small corner..........or a little garden out back.
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