Home Warranty Claim Denied? Here’s What to Do

By Cynthia Cook Robinson

Whether you’re a first-time home buyer, seller, or realtor, investing in a home warranty plan is an absolute must. When major home systems and appliances break down or face maintenance issues from normal wear and tear, the cost to repair or replace these items can be overwhelming and a home warranty can provide peace of mind.

Even so, many homeowners still feel doubtful about purchasing a home warranty policy out of fear that their claims might be denied. So, what do you do when the home warranty company won’t honor the claim? In the guide below, we’ll explain why some warranty claims are denied and what you can do to try and ensure approval.

Top reasons why your home warranty claim might be denied

  1. The appliance or system isn’t covered 

This might seem obvious, but many homeowners overlook the details of their protection plan and expect all items to be covered. This is why it’s important to read the fine print of your residential service contract before signing on the dotted line. Luckily, most home warranty companies have sample contracts available on their websites under their frequently asked questions or labeled in the footer as “Terms and Conditions.”

  1. The item was improperly installed or faces safety code violations 

When a system or appliance is incorrectly installed (a common occurrence), it’s not going to work properly and will require some assistance. Unfortunately, improper installation cases are almost always denied. However, First American Home Warranty is one of the only home warranty companies that actually covers items that have been improperly installed, modified, or maintained.

Claim denials may also happen frequently if systems or appliances aren’t up to code, so consider getting a home inspection before coverage kicks in to ensure that your items don’t have any code violations.

  1. The affected parts or components aren’t covered

It’s possible your home warranty company doesn’t cover all of the parts in your system or appliance. For example, your provider may not cover non-mechanical parts of items like knobs or handles on a washer or dryer or the doors of dishwashers.

  1. The broken system or appliance has a pre-existing condition

Pre-existing conditions are defects or mechanical failures that may not have been detected by a simple visual exam or mechanical test. These issues pre-date the purchase of your warranty policy and most home warranties only cover items purchased after the start of coverage. However, American Home Shield does cover pre-existing conditions, keeping them at the top of our list for appliance coverage. 

  1. The item did not receive sufficient maintenance

Systems and appliances that break down due to normal wear and tear are almost always covered, but if the items appear to have issues due to the homeowner’s neglect or mishandling, the home warranty company has the right to deny that claim. Likewise, the owner’s lack of maintenance on a particular system or appliance can warrant claim denial.

  1. The damage is caused by pets or insects 

Unfortunately, home warranty companies won’t cut you a break if pets climb on or mess with items in some way to cause damage. Vermin or insect infiltration damage also isn’t covered, so your best bet here is to take as many preventative measures as you can and keep pets and pests away from your systems and appliances.

What to do if your home warranty claim is denied 

If your claim ends up being denied, there are still several steps you can take to try and receive coverage. Once you have confirmed the validity of your claim, follow these steps to help you dispute the company’s resolution and issue an appeal: 

  1. Contact your home warranty provider with your claim information and contract number to make an appeal. 
  2. Communicate your appeal clearly and in a calm manner, keeping a log of any representatives who assisted you, the dates they spoke to you, and any information they provided. This process may seem laborious, but it could be useful to you at a later date.
  3. If a service technician or contractor was sent to assess the claim, try speaking with them directly to obtain their inspection report. If possible and necessary, get a second opinion from another repair person or local contractor for comparison.
  4. Follow your home warranty company’s appeal process meticulously, ensuring you provide all proper documentation and keeping what you need for your records. If the company is unresponsive, you can file a customer complaint with the Better Business Bureau (BBB).
  5. If your efforts are still unsuccessful, you can file a complaint with a small claims court or contact your state’s Attorney General’s office to discuss fraudulent companies.

What to do if your auto claim is denied 

Vehicle repair coverage can be expensive, making vehicle warranties not only beneficial but necessary. Like home warranties, auto warranties also have fine print that requires diligent attention and, if not attended to closely enough, can leave vehicle owners with denied claims.

Unfortunately, denied auto warranty claims can be a common occurrence, leaving many customers to fork out a hefty bill. However, just because your claim may be denied doesn’t mean all hope is lost when it pertains to receiving coverage. Extended warranty services count on people giving up easily, so re-submitting your claim can sometimes result in a claim approval.

Here are a few tips to ensure your auto warranty claim gets approved:

  • Read your contract—Just like with your home warranty, it’s important to thoroughly read through your auto warranty contract to see what’s covered and what isn’t. It’s also helpful to know the ins and outs of your contract, like what the claims process looks like, what the contract cancellation process looks like, and how to receive a refund from your insurance company.
  • Go over submitted claim paperwork—Check the claim paperwork you submitted to the repair shop; it could be possible the repair shop didn’t submit sufficient supporting documentation or they weren’t specific in reporting on mechanical issues.
  • Re-submit your claim with a letter—When re-submitting your claim, submit it with a letter clarifying why you believe your claim was incorrectly denied. Explain what component failed and why it’s covered and that you expect to be covered in full and will not settle for anything less. Make a copy of all documentation for your records before you send it out. 
  • Follow up daily—Once your letter has been sent out, don’t be afraid to call every day until they respond to your claim, and keep a record of the customer service representatives you speak to and the day you spoke.

FAQ about warranty claim denials

Q: Should I get a home warranty plan? 

  1. The short answer is, yes. Dealing with possible claim denial can feel stressful, but home warranty plans can prevent even greater stress in the long run by helping cover pricey repair or replacement costs on major systems and appliances. Read our best home warranty guide to find the best coverage for you and your home.

Q: What are the limits of home warranty coverage? 

  1. Sometimes, home warranty companies will have limits and exclusions on systems and appliances that abide by a certain dollar amount. For example, your company may cover repair costs for a broken dishwasher, but only up to a certain dollar amount, leaving you to take care of remaining repair expenses. Certain limitations and caps on repair costs will be stipulated in your contract, so be sure to read through diligently before signing.

Q: What is an extended auto warranty? 

  1. An extended auto warranty—otherwise known as a vehicle service contract—is an optional plan you can purchase to cover vehicle repairs when your manufacturer warranty expires. Extended warranties usually don’t cover routine maintenance such as oil changes, new brakes, and new tires and could be unnecessary for a car with a reliable track record.

Looking for more information on home warranty companies? Check out some of our other expert reviews to get all the details you need. Remember, each of these companies gives a free quote.

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