What You Need to Know About Utility Line Warranties
Ohio utility consumers may receive letters or communications trying to sell utility line warranties for repairs to water, sewer, electric, or gas lines. Some of those letters may have your utility’s name and logo or be an insert in your utility bill. The Office of the Ohio Consumers’ Counsel (OCC) offers the information to consider when deciding whether to purchase a utility line warranty program.
What are utility line warranties?
Utility line warranties are designed to cover all or part of the cost of repairs to utility lines that run to or inside a home and would otherwise be the customer’s responsibility. Utility companies frequently partner with third-party companies to sell and administer utility line warranties.
It may be unclear who is responsible for utility lines. Generally, utilities are responsible for the lines outside your home. Property owners are typically responsible for lines from the meter that lead inside their house. Check with your utility to know where their responsibility ends and yours begins. The best time to do this is before a repair is needed.
What do utility line warranties cost?
Typically, companies offering utility line warranty programs charge between $4 and $15 per month, depending on the type and the number of programs you enroll in. Depending on the company, the monthly fee covers up to $4,000 toward applicable repairs or replacements. Some plans have deductibles that must be paid by the homeowner toward each repair.
How often are line warranties used? Are they worth the cost?
Utility line repairs are rare. A study of water repair permits in San Fransico, a city with many very old homes, showed that less than 1 out of 300 homes had water or sewer line restorations or permits in a recent year. Utility line warranty advertisements quickly note that some repairs can cost thousands of dollars. However, many needed repairs are much cheaper, sometimes less than $500.
Additional things to consider before signing up for a line warranty plan:
- Many customers may never need to replace or have repairs made to a utility line. Copper water lines typically last 30-80 years, and copper electric lines may last 50-70 years. And if repairs are needed, paying out of pocket may often be cheaper than a warranty over time.
- Check with your homeowner’s insurance provider. Utility lines may be covered, or the coverage may be available as a rider on your policy for less than the warranty cost.
- If you live in a neighborhood more than 40 years old where pipes and lines are still the originals and if your neighbors have had replacements, you may want to consider purchasing a plan.
- For telephone lines, most problems typically occur every 20-30 years.
- Many companies will not cover repairs to pre-existing conditions in the line and have provisions to inspect the insured line within a few months of the program start date.
- Talk with the company before spending money to know what is covered and how a condition is determined to be pre-existing.
Electric, Natural Gas, and Water
Line warranties may provide partial or full payment for repairs to your electric, natural gas, or water lines. These programs cost an additional fee that may be billed separately or added to your monthly utility bill. Many programs cover problems such as cracks in natural gas and water lines, aging electric lines that could cause outages inside your home and the lines (except gas) that travel from the curb to your home.
Many local telephone companies offer inside-wiring maintenance plans. Some programs include a replacement telephone or telephone jacks. You should gather as much information as possible to make a well-informed decision before signing up for a plan.
Who can help?
For more information on the available warranty programs, customers may call their local utility company. Before signing up for a utility line warranty program, consumers should learn about the company through a review service like the Better Business Bureau at www.bbb.org.
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