Home Warranty Minnesota Home Inspections MN Property Inspections St. Paul Home Inspection Services

Home warranties have become a popular sales tool in the real estate industry, touted by sales
agents as a low-cost way to make a house stand out in a crowded market. American Home
Shield said in documents filed with the Securities and Exchange Commission it serves 1.3 million
homeowners, amounting for more than 35 percent of a $1.3 billion market. But interviews with
consumers, real estate agents, attorneys and consumer advocates across the country show the
largely unregulated industry is clouded by complaints of poor service, questionable practices and
in some cases, alleged fraud. Many consumers are finding home warranties are often a bad deal.

* $225m in home warranty premiums were collected, but only $16m paid out in claims
* The premium-to-claim pay out ratio is well below normal

Dawn Inserra thought she had all the bases covered when she purchased her first home in July.
She said she hired a home inspector to survey the 35-year-old, three-bedroom ranch in Toms
River for any hidden deficiencies and followed him around for four hours. Then, there was a
one-year home warranty the seller threw in as a closing gift, just in case anything major broke.
Sure enough, two months after she moved in, Inserra said her furnace stopped working. A local
contractor concluded the furnace was on its last leg and could potentially leak hazardous carbon
monoxide through the ductwork in her home.
She said she expected the warranty company, American Home Shield, to pick up the tab.
Instead, she said American Home Shield, the nation's largest warrant company, initially refused
to foot the $4,000 bill to replace her furnace because, a service representative told her, the
heating system had not been maintained properly.
The company declined to comment on this specific case and eventually paid a portion of the cost
after she complained to her Realtor. But it still rankles the 29-year-old Inserra.
"When I bought the house it came with the warranty, and I was reassured that I wouldn't be stuck
with any huge unexpected bills and it turns out to be the opposite," she said.

Warranty Companies on Most Complained List again

The leading real estate portal Angie's list has released its annual list of best and worst rated
companies based on member surveys. Home Warranty companies topped Most Complained
List for 3rd Straight Year. Thirty-eight percent of the reports for home warranty companies were
"F" grades. In addition, architects, structural engineering and solar panel companies made the
bottom ten for the second year in a row. Angie's List collected nearly 300,000 reports in 2007
from members who graded service companies on overall experience, price, quality,
responsiveness and punctuality. Here is the list.

Visit Angie Hicks Blog to read the complete article

Angie's List Top 10 worst grade earners:

1. Warranty companies
2. Home builders
3. Furniture sales
4. Internet service providers
5. Architects
6. Structural engineering
7. Solar panels
8. Taxi/Shuttle service
9. Entertainment/party services
10. Mattresses

Do not rely on these home warranties to cover problems after you buy the house. Many of these
warranties are written so the problems will be denied, you will give up dealing with the company
because of poor customer service, or you will have to pay additional money for the repairs. Some
of these companies deniy you because the product was not serviced regularly, correctly, or you
may not have proof that it was serviced at all. There may be some good companies but many
sources say that this is the most complained about service of homeowners. Have an
inspection before you buy the house. There are many places on the internet to get information
and reviews on these companies.
Here are some links or you can Google; "home warranties good or bad";
my3cents.com
Home Warranty Pros and Cons