American Home Shield renewal-Don't do it early
H Lassiter
until the last minute. I sent my renewal notice back after receiveing
the first one, 2 months early, and selected the 3 payment option.
Rather than waiting until the current contract expires, they billed my
charge card immediatedly. In effect I am double paying for 2 months on
my current contract. AHS has $115 of my money 2 months early.
(Contract expires 12-18 and they billed me on 10-8)
I called them and they said that they just post the charge when it is
received. I was told that I could write a letter to have the charge
removed then re-submit the renewal in December. I should have let them
just send out their 2nd, 3rd and 4th renewal notices and waited until
the last minute to send it in. If I stay with them next year that is
what I will do.
I am going to review a home warranty contract offered by American
Express to see how they compare. Then in December I may decide not to
renew with AHS. Seems from the intial brochure from A/E that they cover
more appliances (washer/dryer and refrig) as standard wheras AHS has
them as an addon. I guess it all depends on any other limitations A/E
has in their contract and how it compares to AHS. A/E also just bills
monthly.
Also, be advised that what AHS has for charges on their web page is not
what you will be quoted if you talk to them directly. It is for "first
time" subscribers only. My situation came up as $285 on the web but on
the phone I was quoted $295.
There is no break for customers who renew their contract year after
year. My renewal is $345. I was told that I can let the contract
elapse for 3 months then start it up again as a new customer to get the
lower rate. I was told that I could do this as many times as I like.
Just would not be covered for 3 months.
I guess I am ranting and raving a lot here but I tend to disagree with
their policy of charging me early for the renewal and them having my
$115 to rather than me.
Comments?
Jim Biancolo
wrote:
>I guess I am ranting and raving a lot here but I tend to disagree with
>their policy of charging me early for the renewal and them having my
>$115 to rather than me.
>
>Comments?
Yeah, this stinks. I have no experience with AHS, but for what it's
worth, I think this is a fairly common practice across all
"renewal-type" services. For example, you've probably noticed that
you get renewal cards from magazines you subscribe to at least 6
months before your current subscription is up. Most of these are
"special" offers designed to make you believe you will get a better
deal if you renew early. In fact, magazine publishers love to earn
interest on your money - the earlier you renew, the more interest they
make.
Jim
--
Jim Biancolo http://www.listology.com
j...@listology.com A searchable anthology of lists
covering movies, books, and music.
dave_fr...@myremarq.com.invalid
warrantees and AHS in particular. I'm curious why you renewed?
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H Lassiter
review the plan from AMEX and cancel AHS before the renewal date came around.
It backfired when they charged me right away. I will still cancel if I think
the AMEX plan is better. It should be a lot of fun trying to get my $115 that
they charged now back before the new policy goes into effect.
The tool man
Since you brought it up, what is your motivation to purchase and renew a
home warranty? I have never considered them to be a very good deal. As
an example, in my current house, expenses resulting from major appliance
repair have totaled $140 in the last 4 years. At about $300 per year, I
would be $1060 in the hole by now if I had purchased a home warranty.
Granted, if my furnace died right now, I'd be in the hole, but things
like that don't happen very often. In my previous house, where I lived
for 9 years, my expenses averaged out to about $40 per year (in today's
dollars), so even with a $2000 failure, I would have been in the hole
had I purchased a warranty. I'm not even considering the deductable.
Let's look at this from the perspective of the insurer. If it makes
economic sense for a company to warranty your home at $300 per year,
they must be reasonably sure that their payments to you will never
exceed some amount below $300 per year or they wouldn't underwrite the
policy, correct? They don't want to lose money, right? Now if you
don't pay your $300 per year, the odds are, your expenses would have
been far less than that, on average. You'd be better off to put the
$300 into a money market account and save up for when the furnace dies.
Regards,
John.
--
The right tool for the job is in your head.
Sent via Deja.com http://www.deja.com/
Before you buy.
Paul Nash
news:7ukcar$28k$1...@nnrp1.deja.com...
> Hi:
>
> Since you brought it up, what is your motivation to purchase and renew a
> home warranty? I have never considered them to be a very good deal. As
> an example, in my current house, expenses resulting from major appliance
> repair have totaled $140 in the last 4 years. At about $300 per year, I
> would be $1060 in the hole by now if I had purchased a home warranty.
> Granted, if my furnace died right now, I'd be in the hole, but things
> like that don't happen very often. In my previous house, where I lived
> for 9 years, my expenses averaged out to about $40 per year (in today's
> dollars), so even with a $2000 failure, I would have been in the hole
> had I purchased a warranty. I'm not even considering the deductable.
I got one as part of the deal for my house. Made sense since the furnace
seems to be working fine now, but is original (thus 34 years and
counting...). It depends on the situation.
> Let's look at this from the perspective of the insurer. If it makes
> economic sense for a company to warranty your home at $300 per year,
> they must be reasonably sure that their payments to you will never
> exceed some amount below $300 per year or they wouldn't underwrite the
> policy, correct? They don't want to lose money, right? Now if you
> don't pay your $300 per year, the odds are, your expenses would have
> been far less than that, on average. You'd be better off to put the
> $300 into a money market account and save up for when the furnace dies.
Okay, but that's not really how it works. The perspective of the insurer is
that they don't want to spend more than the premiums ON AVERAGE over ALL
CLAIMANTS. They could spend $3000 on me in a year, as long as they don't
spend anything on my neighbor and 9 other people. They're not betting that
ALL people won't file claims, just that most people won't. Classic
statistics.
The reason I make this distinction is because you seem to think that these
things are just completely a bad idea for everyone, and that's simply not
true. It depends on the situation.
-Paul
The tool man
"Paul Nash" <pr-...@pobox.com> wrote:
<snip>
> The reason I make this distinction is because you seem to think that
these
> things are just completely a bad idea for everyone, and that's simply
not
> true. It depends on the situation.
>
Hi Paul:
I don't think a home warranty is a bad idea for everyone. I think it's
a bad idea for a statistically significant majority of the population.
If it weren't, the insurance company could not recoup their claim
expenses.
If I had a 34 year old furnace in a house I had owned for a significant
amount of time, it might make sense to insure. For someone just
purchasing a house with a 34 year old furnace, the insurance might be a
good deal, but I don't think I would buy a house with a furnace that old
without taking that into account on the price of the house.
I wonder, do the premiums go up with the age of the house? I've never
checked, but I bet they do because, on average, the liklihood of a major
claim would go up as the furnace, water heater, etc. age. If the
premiums go up, it might not be a good deal to ever get a warranty (on
average, that is).
Then again, what's the price of peace of mind? There are always people
who want to know they're covered (especially if they would otherwise
have to pay for the labor to fix something). There is nothing wrong
with that, as long as you know what it really costs.
JohnD
house is 160 years old. They seem to take the seller's word for it
that whatever they say is working is ok. Of course with all their
exclusions, it's not much more than furnace and water heater insurance.
And I think they pro-rate those based on their age.
Of the 5 failures I had after buying my house, 4 were not covered and 1
the seller didn't realize it also covered him before closing.
Paul Nash
>
> I don't think a home warranty is a bad idea for everyone. I think it's
> a bad idea for a statistically significant majority of the population.
> If it weren't, the insurance company could not recoup their claim
> expenses.
Right -- I can see that.
> If I had a 34 year old furnace in a house I had owned for a significant
> amount of time, it might make sense to insure. For someone just
> purchasing a house with a 34 year old furnace, the insurance might be a
> good deal, but I don't think I would buy a house with a furnace that old
> without taking that into account on the price of the house.
Yeah -- FYI there were other concessions besides the $150 or whatever for
the insurance. Given that I got all the other appliances, some of which are
really nice, all the major systems are in order, the house was a good price,
and they paid my closing costs (and dropped the price a bit after we looked
at the furnace...), I came out alright I think.
> I wonder, do the premiums go up with the age of the house? I've never
> checked, but I bet they do because, on average, the liklihood of a major
> claim would go up as the furnace, water heater, etc. age. If the
> premiums go up, it might not be a good deal to ever get a warranty (on
> average, that is).
Hmm, dunno. It makes sense to some extent, but to be statistically useful,
you'd have to take remodel work into account, as well as lots of other
variables. It sounds like these guys aren't as thorough in their anaylsis
as, say, the auto insurers, who have it worked down to the penny...
> Then again, what's the price of peace of mind? There are always people
> who want to know they're covered (especially if they would otherwise
> have to pay for the labor to fix something). There is nothing wrong
> with that, as long as you know what it really costs.
For me, being a first time owner, it's nice to know that I've delayed a big
cash outlay for 12 months, at which point I probably won't need the
insurance anymore as I could manage a one-time expense like that popping up
in the middle of nowhere. Plus, since I can "feel" it coming, I can even
save money in advance. What a concept. ;-)
-Paul