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Home Warranty Companies Affected by Slowdown: Adjusting Prices/Coverage
It seems that the slowdown in the real estate market has Home Warranty companies that service the Salt Lake City real estate market adjusting their premiums and coverages to keep profits up.
Over the past 45 days prices have gone up by about 18% and deductibles (service fees) are up about 10%.
To be fair, some additional coverages have been added to some warranty companies' offerings, but others have actually lowered their level of coverage by removing items from standard coverage or limiting the extent to which the home warranty company will cover certain claims. The cost of "add-on" coverage (for additional appliances, etc.) has also gone up for most companies.
When I asked one particular representative why prices went up, the first response was because of the additional coverage provided (unknown conditions had been added as a standard inclusion). After a little straight talk about the other areas where coverage or prices had become worse the final answer I got was: volume is down.
At any rate, even at the new prices (About $300 for standard coverage) a home warranty is usually a good investment when buying a home. Especially now that Utah's standard purchase contract has been changed to ... more
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