Avoiding Home Warranty Scams: How to Identify the Worst Companies
Home warranties have become quite popular these days and so has the number of scams targeting unsuspecting homeowners. These scams have the potential to leave homeowners out of pocket and without the protection they thought they had purchased.
If you're unsure how to tell the difference between a reputable home warranty provider and the worst home warranty companies, there are a few key points to look for during your research. In this blog post, we'll look at how to recognize the worst type of home warranty companies and avoid becoming a victim of these scams.
What Are Home Warranty Scams And How to Identify Them?
Home warranty scams are schemes that are designed to take advantage of homeowners who are looking for protection for their homes and appliances. These scams can take many forms, but they all have one thing in common: they are designed to deceive homeowners and take their money without providing the promised protection.
At first glance, distinguishing trustworthy home warranty companies from those in the business of scamming customers can be difficult. Before you give your home protection to a company with a locked-in contract, do your research to understand what qualities to look for in a reputable home warranty company.
1. High Complaint Volume: Look at the Better Business Bureau (BBB) and other online review sites to see what other homeowners think of the company. If there are numerous complaints, it may indicate that the company is not trustworthy.
2. Limited Coverage: Check the fine print to make sure that the home warranty covers all of the systems and appliances you want to protect. It may not be worth the cost if there are significant exclusions or limitations.
3. High Deductibles: Some home warranty companies have high deductibles that make filing a claim costly. Check that you understand the deductible and how it will affect your out-of-pocket expenses.
4. Unresponsive Customer Service: Call the company's customer service number to see if you can get through. If you can't reach a real person or your calls go unanswered, it could be a sign that the company is not reliable.
5. Shady Sales Tactics: High-pressure sales tactics and offers that appear too good to be true should be avoided. Legitimate home warranty providers will give you clear information and give you enough time to make an informed decision.
6. Limited Contractor Network: Because some home warranty companies have a limited contractor network, it can be difficult to find a qualified contractor when you need one. Check to see if the company has a large network of licensed and qualified contractors in your area.
7. Unclear Contract Terms: Companies that use intentionally vague or deceptive contract terms should be avoided. The contract should be clear about what is and is not covered, such as whether there are exclusions for specific types of damage, appliance or system models, pre-existing conditions, coverage limits, and so on, as well as the time frame for receiving service after filing a claim and how long a technician's repair or replacement work is guaranteed.
How to Protect Yourself from Home Warranty Scams?
Now that you know what to look for when identifying the worst home warranty companies, let's take a look at how to protect yourself from home warranty scams. Here are some tips:
1. Do Your Research and Check the BBB: Before purchasing a home warranty, do extensive research on the company. Check the Better Business Bureau to see how long a company has been in business and other online review sites to see what other homeowners are saying about their experiences. A company with a long track record of experience and customer retention is more likely to be trustworthy than one that lacks online transparency.
2. Read the Fine Print: Make sure you understand what the home warranty covers and what it doesn't. If anything is unclear, read the fine print carefully and ask questions.
3. Get Referrals: Ask for referrals from friends, family, and neighbors for reputable home warranty companies. If someone you know has had a positive experience with a company, it's a good indication that they are trustworthy.
4. Check Licensing: Check to see if the home warranty company is licensed in your state. You can verify the company's license by contacting your state's insurance department.
5. Compare Prices: Don't settle for the first home warranty provider you come across. To ensure you're getting the best deal, compare prices and coverage options from multiple companies.
6. Examine the Wait Times: Some home warranty companies have lengthy repair wait times, which can be frustrating if you have a major system or appliance that needs to be repaired right away. Examine the company's average response time and how it handles emergency repairs.
Best Home Warranty Companies
There are several home warranty companies in the United States that have received positive Better Business Bureau (BBB) ratings and provide reliable coverage options, good customer service, and competitive pricing. Here are some of the best home warranty companies in the US based on those factors:
American Home Shield (AHS): With an A+ BBB rating and numerous positive customer reviews, AHS is one of the largest and most well-established home warranty companies in the United States. They provide comprehensive coverage options for appliances and systems such as HVAC, plumbing, and electrical, among others.
Choice Home Warranty: Choice Home Warranty has an A- BBB rating and covers a wide range of appliances and systems, including optional coverage for items such as pool equipment and well pumps. They also provide a 30-day money-back guarantee and 24-hour customer service.
First American Home Warranty: With an A+ BBB rating, First American Home Warranty offers a variety of coverage plans to meet the needs of homeowners. They have a simple pricing structure with no service fees or deductibles, and they provide a wide range of coverage options for appliances and systems.
Select Home Warranty: Select Home Warranty has an A- BBB rating and provides coverage for appliances and systems in all 50 states. There are several plans to choose from, including coverage for septic systems and roof leaks.
Liberty Home Guard: Liberty Home Guard: has an A- BBB rating and a variety of coverage options for appliances and systems, including optional coverage for items such as pool and spa equipment. They have a straightforward pricing structure and a claims hotline that is available 24 /7.
AFC Home Club: AFC Home Club has an A- BBB rating and offers comprehensive coverage for appliances and systems, as well as optional coverage for items such as electronics and roof leaks. They offer a variety of plans and a 24/7 claims hotline for customer support.
Home warranties can be quite helpful for homeowners who want to avoid unexpected repair costs. However, in order to avoid falling victim to home warranty scams, you must be vigilant and do thorough research. You can avoid scams by using the tips in this blog post to identify the worst home warranty companies. Always read the fine print, compare prices and coverage options, and trust your instincts if something doesn't seem right. You can find a reputable home warranty company that provides the protection and peace of mind you require with a little research and caution.