To Insure or Not to Insure

Homeowners occasionally receive fliers offering protection if one of their utility lines should fail. But do you really need such a warranty? In most cases, homeowners almost never need to replace or repair their utility lines; however, a when a water line, sewer line or electrical line does break it can cost thousands of dollars to repair.

Typically, homeowners are responsible for the service lines that run from the curb stop, or service shutoff to their home. While the water department usually owns the meter to ensure proper billing, the homeowner is responsible for any damage. In some states, the local utility company is responsible for the maintenance and repair of the natural gas line connected to the residence.

Whether or not you need such insurance depends, in large part, on the age of your home. If you live in an older neighborhood, where the homes are more than 40 years old and the pipes and lines are still originals, you may want to consider purchasing such a warranty. Check with your neighbors to see if they’ve had to replace or repair any of their lines then follow up with your local water or utility company if you’re still unsure.

There’s no need to worry about telephone lines outside of the house, the phone company takes care of them. But, phone lines that run inside the house are the homeowner’s responsibility. The phone company will sell you a warranty to cover that wiring but, once again, whether or not you need it depends on the age of the house. Phone wires tend to have problems after 20 or 30 years. Some companies won’t cover repairs because of pre-existing conditions such as wear in a line so they may want to inspect it first.

Most companies offering line warranty programs on average charge an annual fee up to $120, which will cover repairs up to about $4,000. Warranties differ greatly so consumers need to check over them carefully before deciding to sign up. Also, check with your homeowner’s insurance agent to see what, if anything, is covered by that policy.

If you still have questions or aren’t sure whether or not to get the additional coverage, your best bet is to talk with a warranty company before spending any money to see exactly what’s covered and how they determine a condition is pre-existing.

You can also check with someone you can trust, Better Business Bureau® to find a reputable warranty company using the keywords home warranty plan or repair service. Naturally, you can always contact them through bbb.org with any questions you may have.

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About Howard Ain

Howard Ain has been reporting consumer news on Cincinnati television for the past 38 years. He also writes a newspaper column alerting readers to consumer scams. He now joins BBB|Cincinnati as a correspondent.