MEMPHIS, TN -
(WMC TV) - The warranty offer is legitimate.
But so are our questions about American Water Resources.
The New Jersey-based company has mailed an untold number of marketing brochures to Mid-South homes. The mailer touts a 12-year-old water and sewer line warranty program.
In a phone interview, Barbara Boyarsky, the company's vice president and general manager, said for $5 a month, customers are guaranteed up to $5,000 in repairs of water or sewer line damage that is determined to be the responsibility of the homeowner. She said the warranty provides an additional $5,000 in protection if roadway repairs are necessary.
Boyarsky said customers simply make one call and file a claim. Then American Water Resources dispatches a local "certified" contractor to do the job.
"And then that's it," she said. "The customer doesn't really have to do anything else. We get the permits. We do the job. We get it done."
She said the company designed the warranty program to take care of water line damage that neither a local utility nor a homeowner's insurance policy will cover -- specifically, water lines running from the home to the water meter.
"The water lines between the meter and the customer home are considered private property, the property of the owner," confirmed Glen Thomas, communications director for MLGW.
An insurance source who spoke on condition of anonymity also confirmed most homeowners' insurance policies do not cover damage to water lines running from the meter to the home.
Boyarsky said the company's water line warranty program has a 93 percent customer satisfaction rate. The Better Business Bureau of the Mid-South gives American Water Resources its highest customer service rating, an A+.
However, the BBB has recorded 26 complaints about the company in three years. The complaints include "problems with product/service," "guarantee/warranty issues" and "billing/collection issues."
The BBB confirmed American Water Resources resolved each complaint with the bureau's assistance.
"We fully manage the system," insisted Boyarsky. "We are self-insured. We service approximately one million customer contracts, and we conduct business in 35 states. So 26 complaints in three years is considered very positive customer service."
Before you consider the water line warranty, be aware of these:
* IT LIMITS YOUR CHOICE OF CONTRACTORS. Under the American Water Resources warranty, you must have repairs performed by local contractors who are under contract with the company. You cannot hire your own contractors or shop for estimates.
* IT'S VOIDED IN FLOOD ZONES. Make sure your home is not within a flood zone before you commit to the warranty's 1-year customer contract.
* IT'S VOIDED BY PRE-EXISTING CONDITIONS AND 'ACTS OF NATURE.' That allows a lot of wiggle room for the company to deny claims.
The warranty includes a 30-day money-back guarantee after signing the contract. After 30 days, you can still cancel, but any refund is prorated.
Consumers considering this should also consider this alternative: set aside a budgeted amount of money each month as a home repair emergency fund. That would give consumers the flexibility of vetting their own contractors with the Better Business Bureau and with state contractors boards.
For another comprehensive report on the American Water Resources warranty program, please read Watchdog Nation's blog.
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