American Home Shield seems like a good idea...

I have held home warranties with American Home Shield for over 6 years on my home and a rental property I own. Every year I have debated whether the $400 & $600 premium was worthwhile. I certainly don't normally spend that much on appliance repairs, but I was comforted by the piece of mind that an unusual, catastrophic loss would be covered. Last year I experienced that catastrophic loss that AHS loves to tout as their opportunity to save the day. My outdoor spa broke and I called on AHS to have it fixed. It's a large spa, and repair or replacement is always an expensive proposition.

AHS first told me that they had no contractor to fix it, and I would have to find my own. The guy who came out advised me and AHS that the spa was too old to accommodate current parts, and should really be replaced. He said that any repair he could do would probably only be a temporary fix. To avoid paying for replacement, AHS insisted that the spa be repaired. (See their literature that boasts how they will replace anything that is beyond fixing). I had no choice but to have the guy fix it, and it looked crappy, due to the mismatched parts he had to use.

Well, come winter, as predicted, the spa broke again. Once again, I called a service request to AHS. A different contractor this time reiterated that the spa should have been replaced before, instead of having that half-baked repair. AHS looked for any reason in the book NOT to pay for this replacement, which will be in the $thousands. They blamed the first contractor; they said the repair was never done right and I should sue him for it, even though they insisted that he do the repair that way. The new contractor couldn't do a full evaluation, because since the spa broke in 20 degree weather, some of the parts had formed ice. Well, that was all AHS had to hear. The contract states that they don't cover ice damage (i.e., if you leave your refrigerator outside in the winter) Obviously, a spa that breaks in the dead of winter will form some ice. It's an incidental occurrence. The spa keeps water hot; a broken spa will let the water get cold. But in my case, it was all they needed to deny the claim. Nevermind that they made me endure the temporary fix, nevermind that I pay an extra $130 a year to have the spa covered, nevermind that I already paid $535 for the temporary repair that AHS wouldn't cover, nevermind that if it had broken 3 months earlier, there would have been no ice around but it still would have been broken... I was very disappointed to find that after spending over $5000 in premiums over the years I held their contract, the one time I needed them most, they shrunk away like any sleazy insurance company- happy to take your premiums, but ready to drop you like a hot potato when you need them. So almost a whole year since the original problem, I still have a broken spa, and I'm at square one with footing the bill for replacement myself.

I am happy that I will not be renewing my AHS contract this month, and I'm sure I can make more productive use of the $1000 a year I've been paying them. Ask yourself whether you spend $40 or more every month in repairs, or whether you could afford your own repairs on that budget. (Remember you still pay $35 in addition for each repair that is made) As for piece of mind for large losses, don't rest assured; they probably won't be there for you if that time comes.