What to Do if a Home Warranty Company Denies Your Claim

A home warranty can help ease the financial burden that comes with a broken-down appliance or major home system. However, warranty companies don’t automatically approve every claim. 

If you’re facing a denied home warranty claim, you probably feel both frustrated and confused. Let’s review the most common reasons why these denials happen, what your rights are, and what steps you could take to appeal or improve your claim’s odds.

7 Reasons Why Your Home Warranty Claim Might Be Denied

1. The appliance or system isn’t covered 

It may seem obvious, but many homeowners expect a home warranty will cover every component of their house. This simply is not the case. A typical residential service contract will outline what appliances, systems, and components are excluded, or not covered by the policy.

Most home warranty companies have sample contracts available on their websites under their frequently asked questions (faqs) or labeled in the website footer as “Terms and Conditions.” Before you sign any home warranty, carefully read what’s covered and what’s excluded so there’s less chance of surprises.

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

It’s sadly all too common for systems and appliances not to be installed properly. That, in turn, causes them to work improperly—and when that happens, a home warranty typically won’t cover the repairs. First American Home Warranty stands out as one of the few home warranty companies that covers improper installation, modification, or maintenance of items.

Claim denials may also happen if systems or appliances aren’t up to code. Before you sign a home warranty contract, consider hiring an inspector to look at covered items and make sure they’re compliant.

3. The affected parts or components aren’t covered

Home warranties sometimes exclude specific parts of an appliance or system that’s otherwise covered. For instance, your provider might exclude coverage for dryer knobs or dishwasher doors, as these are usually non-mechanical parts.

4. The breakdown is pre-existing

Pre-existing conditions are defects or failures that were present before your warranty coverage. Most home warranty companies only cover issues that happened after the start of coverage. This is one more reason why you may want to have your appliances and systems inspected and tuned up before you sign a warranty contract.

There are exceptions to the norm. American Home Shield is one home warranty company that does cover pre-existing conditions.

5. The item was mishandled or didn’t receive routine maintenance

Claim reviewers at a home warranty company will consider both the nature of the breakdown and why the breakdown happened. If normal wear and tear was the cause behind a claim, the company will typically cover it. However, if it determines that homeowner neglect, mishandling, or lack of maintenance was behind the issue, it will likely deny the claim.

6. You’ve exceeded the coverage cap

Home warranty plans have caps that limit the amount they will pay on major systems and appliances in your home. If you’ve hit your coverage limit during the current term, the home warranty company will deny your claim. 

7. Pets or pests caused the damage

Regrettably, home warranty companies can deny claims if pets damage an appliance by climbing on it or interfering with it. They can also exclude damage from pests. To improve your odds of a future successful claim, keep up with preventative maintenance and teach your pets to stay away from your appliances.

What To Do if Your Home Warranty Claim Is Denied

If your home warranty claim is denied, you can still take steps to pursue coverage. Once you have confirmed the validity of your claim, follow these steps to help dispute the company’s decision:

• Start with appeals: Like regular insurance companies, home warranty companies will outline a claim appeals process in their contracts. Start by reaching out to the home warranty company and calmly making your case. To protect your rights, do not say anything that could reasonably convince the company to deny the claim.
• Get a copy of the inspection report: The warranty company may send a contractor or service technician to your home to evaluate the claim. Try speaking with them directly to get a copy of their inspection report.
• Get a second opinion: You may want to get a second opinion from another repair technician to compare and shed new light on the issue.
• Keep accurate records: Keep a written log of representatives you spoke to, dates you contacted the warranty company and other companies, and what details you share.
• Handle unresponsive companies: If the warranty company isn’t responsive, you can file a complaint with the Better Business Bureau (BBB.) This may prompt further action.
• Know your legal options: If a home warranty company is acting fraudulently or violating the terms of your contract, you may have legal options. As a last resort, file a complaint with your local small claims court or contact your state Attorney General’s office to discuss the issue.

It’s frustrating to have any warranty claim denied. However, persistence and thoroughness are key in the dispute process, and with perseverance, you may still achieve a favorable outcome.

Looking for more information on home warranty companies? Below are expert reviews providing all the details you need. Keep in mind, each of these companies offers a free quote.

• Choice Home Warranty review
• American Home Shield review
• Select Home Warranty review
• Amazon Home Warranty review
• First American Home Warranty review
• Liberty Home Guard review