VENTURA, Calif.--(BUSINESS WIRE)--Validating what it terms a “strong track record” for customer service by California’s home warranty companies, the Home Warranty Association of California (HWAC) reports that, “As an industry, we receive a minimal number of escalated complaints in relation to the large number of contracts issued and subsequent requests for service.”
With over 800,000 home warranty contracts in force statewide, at least 1.6 million service requests are placed annually, HWAC reports. “The very low percent of complaints to regulatory agencies – less than one-tenth of one percent – serves to confirm that home warranty companies are indeed focused on customer service,” said Mark Lightfoot, president of HWAC.
The association says this is due in large part to member companies’ “trained and dedicated service representatives who are committed to helping customers with their need for home repairs,” which reportedly average over two repairs per contract per year.
Lightfoot emphasized that HWAC statistics reveal that over 90 percent of home warranty contract service requests are covered, with less than 10 percent either partially or wholly-denied, according to the terms and conditions of coverage.
“Usually complaints to regulators focus on such issues as a customer not realizing that some items are not covered, such as lawn sprinklers,” Lightfoot added. He encouraged consumers to review what items are covered in their contracts, and to regularly maintain valuable home systems and appliances.
“Home warranties,” continued Lightfoot, “typically cover heating and air conditioning systems, water heaters, electrical, and plumbing within the perimeter of the main foundation.”
He notes that home warranties are user-friendly from a cost standpoint. He said home warranty companies charge the customer a low trade service fee (typically $35-$55) for each visit. “This helps keep the price of the warranty low and ensures that the unlimited repair service feature is not abused. It is similar to a deductible for your homeowners insurance,” he said.
Lightfoot stated that home warranty companies focus on retaining customers year after year, emphasizing that this is one major reason for the steady rise in home warranty contract renewal rates. HWAC estimates a renewal rate of 70 percent after the second year.
“Customers who complain are less likely to renew, so home warranty companies work hard to minimize complaints. Additionally, home warranty companies utilize local contractors, who have a vested interest in keeping customers happy. When a non-covered item needs repair, or the customer wishes to upgrade an item, the contractor who does a good job is the one the customer will remember first,” Lightfoot declared.
The HWAC president reminded consumers that the price of a home warranty is reasonable in today’s economy (between $250 and $350), and that the contracts do not cover everything. Home warranty contracts do not cover structural items (except certain optional coverage that is available providing roof leak repair). Nor do they cover breakdowns not caused by normal wear and usage.
All home warranty companies have a customer service center with trained employees who care about the customer’s problems, Lightfoot stated. “Mistakes do happen, of course, but service center employees are there to help the customers in time of need,” he concluded.
Typically, a home warranty covers a home’s major operating systems and appliances against breakdowns due to normal wear and usage for one year after the close of sale. Items covered include plumbing, heating and electrical systems, most built-in appliances, and water heaters. In recent years, most HWAC member companies have provided additional coverage for plan holders for such items as garage door openers, washer/dryers and refrigerators.
HWAC is a statewide organization of home warranty companies representing approximately 95 percent of contracts sold in California.
Member firms are American Home Shield of California, Buyers Home Warranty Company, Fidelity National Home Warranty Company, First American Home Buyers Protection, HISCO Home Warranty Plan, Old Republic Home Protection Corp., Inc., and 2-10 HBW Warranty of California, Inc.