BBB Tip: Water Line Coverage Mailing Optional for Homeowners
January 31, 2013

    The Better Business Bureau serving Western Michigan is receiving inquiries from local homeowners regarding mailings from companies offering programs that provide water service line coverage. Many want to know what exactly water service line coverage is. Others state some solicitations look suspiciously similar to mailings from their local utility and are misleading.

Water service line coverage is a protection plan similar to an insurance policy and provides coverage for damage to water and sewer lines from the shutoff at the sidewalk box up to the home, which is the responsibility of the homeowner.

According to plumbing specialists, while leaks can occur in lines, it is not something that happens often. This especially is true in newer communities.

Many consumers contacting us believe mailings are being sent in conjunction with their local utility company; however, this is usually not the case. A close look at the fine print shows disclosures indicating the sender is an independent company separate from the local utility. Homeowners should be aware coverage is completely optional.

Reading the fine print allows you to familiarize yourself with exclusions contained in the policy. Common exclusions include: Acts of God; thawing of frozen pipes; repair of covered parts, equipment and/or systems due to reduction in performance caused by normal wear and tear; repairs when parts are obsolete; costs to correct or upgrade a part, equipment and/or system in order to comply with the law; recalls, defects or class action suits. Additionally, homeowners are often limited to a certain number of claims per year and/or up to a certain dollar amount per claim.

If you are thinking about getting water line coverage, you may want to check with a local, trusted plumber first to learn what types of problems could occur with your water line and how likely it is any of these issues will occur. With that information in hand, you can estimate what the maximum cost of those repairs could be and, considering policy exclusions, decide if the insurance policy would offset the cost of the repairs.

The BBB recommends the following tips to consumers who receive solicitations from water line service companies:

  • Read the service contract carefully and make sure you have a clear understanding of it, especially each of the exclusions. Some of the policies are riddled with exclusions, while others are not.
  • Avoid purchasing coverage over the phone without seeing a contract with all details that you discussed in writing.
  • Shop around. Some providers are better than others in terms of price and, most importantly, customer service.
  • Make sure you're familiar with the company's cancellation policy in case you change your mind after signing up.
  • Check the company's BBB Business Review to see if there are any unanswered or unresolved complaints or if the company has a pattern of similar-type complaints.