Home warranty cost

[Ed Pawlowski]

Had a call from someone selling home warranties. He told me how it would save me money. I asked him how. He said if an appliance broke and had to be replaced, the premium for a year is $600 and the appliance would be $1000 so I'm ahead.

I explained that I've owned a home for 55 years. Adjusted for inflation, that is $33,000 I would have paid in premiums. Over that time, I've replaced a couple of washers, a freezer, a couple of refrigerators, an OTR microwave. Had a couple of repairs. Probably spent about $10,000 that would have been covered by a warranty.

So put that premium in the bank and over time you will be many thousands ahead.

[invalid unparseable]

I feel the same way but mentioned after our range problem when we bought a new range we got $150 five year extended warranty for it.

Some of these damn new kitchen appliances may only last seven years and we had wasted over $500 trying to repair our two year old range. Wife wanted the policy for peace of mind.

Some people may save money with these warranties but on the average the warranty seller profits just like any other insurance policy.

[hubops]

Me too ! just yesterday. It was a real person on the line too. < most of my scam calls are robo-callers >

We didn't get to the cost, after the 15-day free trial because she wanted my bank account info so she could have my Provincial Tax Rebate deposited ... uh huh .. John T.

[gfretwell]

Extended warranties are very lucrative for the companies that sell them.

[Marilyn Manson]

You cannot call, text or email Verizon Wireless without them trying to sell you their Verizon Home Device Protect program. As I have verified, they are *required* to try and sell the product every time they talk to a customer.

Whenever I contact them and they ask me how they can help, I always get that out of the way *immediately* by telling the rep that "I am not interested in the Home Protect program. You can tell your supervisor that the customer requested that you do not try to sell the program during this phone call. Let's just concentrate on the reason that I called, OK?" There is usually a pause, a stutter, and then an "OK".

$25/month plus a possible $49 or $99 charge per service call. If people are actually signing up for that, Verizon (actually Asurion, or both) must be making beaucoup bucks.

[Tekkie©]

On Fri, 3 Sep 2021 13:17:19 -0400, Ed Pawlowski posted for all of us to digest...

C'mon man. You destroyed his scam. Dis he hang up on you or listen? Many stories on this group of how homeowners are bilked by this crap. I wonder what the actuarial rate is? It must be profitable.

By the way--don't you need a vehicle warranty? :-)

[Ed Pawlowski]

Had the car warranty call yesterday. Told him my car was in the flood from the rains of Ida but he still wanted to know how many miles was on it. They just don't give up.

[micky]

LOL. Did he try to reply?

One should not insure against losses he can afford to sustain. He can act as a self-insurer, dispense with the paperwork costs and overhead, and keep the profits.

Unless possibly the post office takes better care of packages that are insured, but I don't think they do.

The only losses most middle income people can't afford are having their house burn down, killing or seriously injuring one or more people in traffic accidents, and dying (probably before retirment) and leaving a spouse who can't live well without the income that is gone, or minor children or those not trained enough to make the kind of living they should be able to make.

My father had 3 life insurance policies, one he bought when only his mother and to some extent his divorced sister and her son were depending on him, maybe one he bought after he married, and probably one he bought after I was born. Interestingly, for two of them he would have been 62 when he died, but the only insurance company to complain was the one for which he was 63, so they would have charged a higher premium.

[gfretwell]

Tell them you have a 97 Honda, they hang up

[trader_4]

Same thing with the car warranty companies on TV. All they talk about is that if your transmission fails it will cost $3000 and showing people saying that they saved me $3000 when my transmission failed. Nothing about how much per month they paid and for how long, versus what they actually got back after deductibles, etc. Even worse, one of the biggest that's on TV, if you look at all the complaints, it's horrific. Stories like customer has a car that they can't drive, it's in the shop, repair guy has wasted hours on the phone on hold, they insist that they have to send someone out to inspect it, claims denied, etc, etc, etc. I am curious about one part. They say when the car has a problem, just take it to your favorite mechanic or the dealer. We know how much dealers charge, typically won't use aftermarket parts, etc. So, how does that work? How many dealers will deal with these warranty companies? I wonder how many independents will? I bet those contracts have plenty of terms and conditions, limits, exclusions, etc that few people bother to read.

Only way this might make sense is if you have a car that you know is very problem prone and you want to pay by the month and hope that they will cover it and you'll come out ahead. But better yet, just sell the car.

[trader_4]

One trick most of these pull is that the 5 year warranty includes the one year or whatever comes with it to begin with, so you're actually getting just four. But I've done the same thing on rare occasions. Like I bought a floor model Kitchenaid double oven on Ebay. Whether it had a KA warranty was questionable, so I bought the SquareTrade warranty for a couple years for $70 on that, which listed for $3000. Nothing went wrong, until recently, when it's now out of warranty. One of the broiler elements is kaput, so it only does the center broil, not full. Fortunately that should be easy and cheap, assuming it's just the element.

[trader_4]

That's one of the worst cost vs benefit examples there are. The post office would have to be losing maybe one in twenty packages to have it make sense. And then the pricks only give you the value of the item, not the postage cost too. So if you send a $30 widget that costs $8 to ship, you pay a couple of bucks for the insurance. If they lose it or destroy it, you get $30, but you're still out the $10. You still have to send the $30 widget again and pay another $10. I always self-insure and I'm way ahead. Exception is priority mail where insurance for the first $50 is included, so that works out well sometimes.

[Retirednoguilt]

at least not in my case. Since retirement from active duty 20 years ago, I haven't been entitled to military dental care and have to pay for it. I've explored many dental insurance plans, including those sponsored by AARP, the VA, and the DoD for retirees. In every case, when I added up the cost of the premiums, deductibles and copays, the annual cost would have exceeded what I've spent for 2/x yr dental exams including routine x-rays every 2 yrs. at my neighborhood dentist. Occasionally, when I needed some work, the cost was higher for that specific year. But when I added up what I would have paid with insurance vs. my actual cost without insurance over the entire 20 yr period, the total difference in cost for all 20 years was less than $150 total. I'll continue to "self-insure."

I agree completely that, "One should not insure against losses he can afford to sustain. He can act as a self-insurer, dispense with the paperwork costs and overhead, and keep the profits."

[invalid unparseable]

Former employer has dropped dental subsidy. Depending where you live the lowest cost policy will pay for two cleanings and xrays for about $240 a year. In my area that cost is about $500 so insurance is well worth it. It is basically useless for any other dental costs but you are better off to be self insured. If you need the insurance for full mouth implant coverage the cost is astronomical but how often do you need that done?

[micky]

I didn't think to include that when you use yourself as the insurer, you always get paid. You're not at the mercy of a cautious or slimy insurance company who makes you jump through hoops to get paid or doesn't pay at all. Trader gave examples of those. So that's 4 reasons it's better to self-insure.

(I guess I was only thinking of my health insurance, which hasn't quibbled about anything, but that's because I have the insurance that pays almost everything so there is little room to quibble.)

And what about that "return of premium life insurance"? Sure, but it charges more for the same amount of insurance. You don't get something for nothing.

OTOH, around 1960, when banks in Indiana (and I figured everywhere) were paying about 3% interest on savings accounts, I would see ads for Calfiornia banks that were paying 5 1/4%. At the time I thought it was a con, because I thought interest rates would be almost the same everywhere. Even though the ads were in a reputable magazine or newspaper.

Now I'm not so sure and I'd like to know more about it. I wish I'd asked someone at the time.

[Tekkie©]

On Fri, 3 Sep 2021 17:15:51 -0400, Ed Pawlowski posted for all of us to digest...

Now that's funny! Could have told him to hold on because you had to pump the water out to read the odometer... on permanent hold...

[Tekkie©]

On Sat, 4 Sep 2021 13:05:11 -0400, Frank posted for all of us to digest...

*Hopefully* only once. 8-}

[gfretwell]

I paid $150 for my GE convection oven off of Craigslist and the book was still taped to the grates. It said it was preowned but I don't think it was ever used. I have less than $200 in this whole project.

[gfretwell]

Maybe I am just lucky but I don't remember ever losing a package in the mail. I know I haven't since Priority mail came along and I mail a lot of stuff.

[invalid unparseable]

I have a partial and considered implants but with two other old bridges decided not to turn my mouth into a money pit. My brother has implants but they can fail too and one did.

I knew the brother of an 85 year old guy that over a period of several months got total upper implants for over $20,000 and a week after completion needed a quadruple bypass. Brother said his mouth looked good and damned if the brother did not live to be 99. My friend only made it to 85.