American Home Shield Review
American Home Shield can protect you from some kinds of unexpected home repairs — but limitations, exclusions, and disagreements over repair quality have led to rampant customer dissatisfaction typical of the home warranty industry as a whole. Customers who skip the fine print in their contracts could be in for an unpleasant surprise when something breaks and it either isn’t covered or they have limited choice in repairs or replacements.
American Home Shield promises to protect their customers from having to shell out major cash for large and unexpected home repair costs — a claim that’s put it atop the home warranty industry. Its three plans cover your home’s major systems (like plumbing and electric), appliances (like dishwashers and hot water heaters), or both. If any of them go kaput, AHS sends a technician to repair or replace the item. All you have to pay out of pocket is a small service call fee ($75, 100, or $125, depending on the plan).
Still, almost all home warranties come with serious drawbacks. AHS’s contracts are rife with conditions that limit when the warranties can be applied, and it removes certain decisions (like choice of contractor or color of replacement appliance) from consumers. If you fail to research exactly what you’re getting, you may be left unhappy when your dishwasher gives up the ghost.
American Home Shield wins points for offering flexible plans that don’t require home inspections or long waiting periods, but its warranties come with conditions that leave lots of customers unsatisfied.
Like most home warranty companies, American Home Shield is loaded with disgruntled customers who didn’t understand those limitations until after purchase. It’s true they will repair or replace broken systems and appliances in most cases, but several stipulations in the fine print allow AHS to set the terms of repair or replacement — and in some cases wiggle out from covering you at all:
- “AHS has the sole right to determine, according to the terms of this contract, whether a covered item will be repaired or replaced.”
- “AHS is responsible for installing replacement equipment and part of similar features, capacity and efficiency, but not for matching dimensions, brand or color.”
- “Instances beyond AHS’s control may prevent AHS from providing a repair or replacement of a covered item. In these instances, AHS will provide you cash in lieu of the repair or replacement services. The amount will be based on what a consumer without this contract would pay after negotiating the best price for such services in your area.”
- “AHS will determine what services constitute an emergency and will make reasonable efforts to expedite emergency service.”
There’s also some confusion on how those limitations affect the components of each system or appliance, especially when they overlap. An example: Your plumbing system is covered — but not bathtubs, sinks, or showers. These restrictions inevitably lead to frustration when customers discover repairs aren’t covered after they need them — or that they aren’t guaranteed their exact choice of replacement.
But the warranty isn’t useless: A broken fridge might cost several hundred dollars to fix; a busted heater could set you back by a few thousand at minimum. In those cases, paying $30 to $50 a month might be a solid deal. Focusing on exactly what you are (and aren’t) getting before signing is key. Also, since home warranty prices are determined through quotes, it pays off to shop around. Testers who surfed providers’ quote systems eventually found a plan for $40 per month with Choice Home Warranty and $34.95 per month with Home Service Club. But coverage varies wildly, so pay attention to more than price: Create a list of must-haves before diving into the quote process.
A Closer Look At Features
Varies by location and covered items
Air conditioning, including ductwork
Service Call Fee
$75, $100, or $125
Years In Business
Better Business Bureau Rating
If you want a flexible warranty they can customize to your needs
If you prefer to select your own technicians and appliances
- Flexible, custom plans: American Home Shield offers three basic plans — a Systems plan, an Appliance Plan, and a Combo plan. But the Build-Your-Own option allows you to pick what you want covered exactly. Over the phone, representatives will work with you to customize your policy during the quote process. One tester’s home doesn’t have air conditioning, so the rep removed that from coverage to lower her rate.
- 24/7 service requests: American Home Shield responds to service requests at any time of day or night. But they usually only pay for repairs during normal business hours (a big problem if your A/C dies on a summer Friday night). AHS will cover emergency services — but they solely determine what constitutes an “emergency.”
- Choice of service call fees: Choose between $75, $100, or $125 service call fees. Higher service fees lower monthly premiums: Testers who chose a $100 service call fee saved $9 per month over the lower $75 fee.
- Network of qualified technicians: American Home Shield’s network of over 11,000 independent contractors and 45,000 service technicians mean they can get qualified professionals on service calls anywhere in the nation.
- Short waiting period: Most home warranty companies require a 30-day waiting period before activating your policy. American Home Shield’s is a scant 15 days.
- No home inspection required: Some home warranty companies require a house call from inspectors to verify that your appliances and systems are tip-top before approving your warranty. American Home Shield doesn’t — the quote process can segue directly into a policy purchase.
- Getting a quote requires patience: The online quote tool wasn’t working when testers tried it, so they called and were put on hold for nearly 10 minutes before speaking to a human. Once they did, testers report the rep was very helpful and effective at walking the tester through the different plans and restrictions.
What Others Are Saying
The Chicago Tribune highlights one customer’s difficulties in getting AHS to fix his broken air conditioner as an example of all the problems one might encounter. The customer says:
“They're very polite on the phone. You really got the idea that they were going to help you out. But it was just horrific that you could go nine weeks without air conditioning."
Angie’s List reports that home warranty companies have the dubious distinction of being one of the worst-graded categories on their website. One American Home Shield customer said of his experience: “I did the math, and I figure you’re paying all this money for the warranty and then you pay $50 to $75 for every service call. It really doesn’t add up. Plus, the people they sent to do the work were late and unprofessional. I got real put off.”
Other Home Warranties We Like
The Home Service Club offers three home warranty plans in 48 states. The Systems and Appliance plans are comparable to American Home Shield’s, but HSC’s Comprehensive plan adds on plumbing stoppage coverage, gas leaks, pest control, and more. They also have three service call fees: $65, $95, and $125.
Like AHS and Home Service Club, America’s 1st Choice Home Club offers three plans. A Bronze plan that covers only heating, air conditioning, and water heaters is a fine choice for those who need only a basic warranty to cover only the most expensive fixes. The Silver plan covers major appliances, and the Gold plan covers appliances and all major systems in the home. You must call for a quote.
First American Home Buyers Protection lacks the flexibility of some of the other home warranty companies. Their two plans don’t cover certain systems, like air conditioning, that come standard with most home warranty companies — that costs extra.
The DIY Approach
You can avoid home warranties and protect yourself from unexpected breakdowns on your own. Saving $100 away every month in an emergency fund nets $1,200 by the year’s end a comfortable cushion that should be enough to cover most home repairs. Bonus: If those repairs aren’t necessary, you have the makings of a vacation fund.
Investing in a home warranty is a bit of a gamble anyway: It’s impossible to predict if or when your home systems might falter. According to a survey by Decision Analyst, repairing a broken refrigerator could cost between $223 and $1,500. The policy quote we obtained from AHS would cost $516 annually plus $100 for every service call. A $1,500 repair would justify the monthly payout, but if the repair amounted to anything less than $1200, we’d have saved money by building an emergency account.
So is a home warranty right for you? Consult your intuition and do some math: Consider the age and value of your home systems and appliances. Determine how much money you can afford to sock away each month in an emergency fund. Then spend some time quote surfing. In most cases, a steadily growing emergency fund removes the need for a home warranty. As an added benefit, you’ll earn the independence to choose your own appliances and service technicians on your schedule.
The Bottom Line
Only you can decide if an American Home Shield warranty makes sense for your abode. Do the math, always read the fine print, and measure if the potential savings are worth the exchange of freedoms and limitations that come with any home warranty.