Home Warranties:
Smart or Scam?

Key Takeaways

  • Webinar Structure and Interactivity: The transcript begins with the webinar introduction, emphasizing the interactive elements such as polls to engage the audience. This approach is effective in gauging participant knowledge and expectations.
  • Home Warranty Explanation: The session covers essential aspects of home warranties, including what they cover and do not cover, helping landlords understand the benefits and limitations of such plans.
  • Financial Implications: The webinar highlights the financial benefits of home warranties, noting the potential savings on repair and replacement costs which can significantly impact a landlord’s yearly expenses.
  • Service Process: Detailed explanations are provided about how the home warranty process works, including claim filing and contractor dispatch. This information is crucial for landlords to manage expectations and understand their responsibilities.
  • Comparison with Insurance: The session differentiates between home warranties and insurance, clarifying which types of damage or issues each one covers. This distinction is vital for landlords in optimizing their property protection strategies.
  • Interactive Q&A: The webinar includes a live Q&A segment, where attendees can ask specific questions, making the session more relevant and informative for their particular needs.
  • Technical Details: Detailed explanations about how to file claims, the role of deductibles, and the use of preferred contractors provide practical knowledge for landlords to effectively use home warranties.

Transcript

Krista Reuther:

Well, why don’t we get this show on the road? Samantha, if you’d like to kick us off.

Samantha Yadav:

I would love to. So you’re all here for the home warranty webinar. My name is Samantha. I’m with the education and community team here at TurboTenant and we are joined by Krista Reuther, who’s also on the education and community team here at TurboTenant. And we have an esteemed guest, Liv, is joining us from Armadillo. So we will jump in and talk about home warranties, kicking off with a poll.

Krista Reuther:

There we go. Ah, too fast. I’m so good at clicking. Oh, please fill out that poll and just ignore the slides.

Samantha Yadav:

So on this poll, we would like to know how many rental units you own or manage. If you have attended a TurboTenant webinar before, we’d also like to know your best guess on how much does the average landlord pay in repair and replacement costs of key home systems and appliances annually. So throughout the year, what is your best guess on cost? Well said.

Krista Reuther:

We like to do this little check-in to make sure that we get to know you and to just hook you with a little piece of data that we will be going through over the course of this presentation. So do click in and let us know your thoughts. Okay, if you have a closer… Oh, go ahead. I was just giving them ten more seconds. What do you see so far, Samantha?

Samantha Yadav:

So far, I’m seeing that the majority of landlords are guessing in relation to question three, the average cost is $4,000 annually for replacement costs and repair costs of key home systems and appliances.

Liv Coffman:

Well, that’s tenured folks who are guessing well on the call.

Krista Reuther:

Let’s look at this together. So demographics are always interesting. It looks like we have a lot of landlords with one to four units today. Great to have you. And of course, some smatterings across the board there. Good divide on people who have come to webinars before versus not. But let’s get into the meat of it with this average cost question out of curiosity.

Liv, I’m not going to ask you because you are an expert. But Samantha, if you had to guess the average cost for landlords in terms of maintenance every year, what would you guess?

Samantha Yadav:

Gosh, I’m going to get crazy and say $6,000.

Krista Reuther:

Whoa, that’s so crazy that you’re right. So crazy. Yes, what a champion. It is $6,000 on average per year in maintenance costs for landlords. So that is something worth keeping in mind as we move through.

Samantha Yadav:

Right. So here are some takeaways that we hope that you leave with today after the webinar. The first is that home warranty plans cover normal wear and tear on designated appliances. We also want you to know that home warranty plans work with your landlord insurance to complete your rental property coverage.

And then finally, finding coverage that’s suited to your needs and portfolio is simple. So we’ll talk through all these points. And if you do have questions along the way, we have our chat available as well as that Q&A where you can send questions for us to answer at the end of the session today.

Krista Reuther:

I absolutely couldn’t have said it better myself. Now, before we hop into everything, first off, we are going to record this webinar for you and send it over as soon as possible. So by the end of the day tomorrow, you will have a recording of this presentation along with the deck so that you can click into any of the resources that we share here. And like Samantha said, let your questions fly, whether that’s in the chat or through the Q&A. We love to hear them.

So keep them coming. And with that, let us hop into home warranties. Now, something that I think is really interesting is how many questions we got about whether or not home warranties were a scam.

There was some confusion about what they actually do if they can really fulfill what they say they do. So let’s make sure we’re all on the same page first about what a home warranty is. My computer’s moving so slow.

Okay. Oh, and then too fast. Technology is super fun. I’m having a great time. Hold please. All right.

There we go. So what is a home warranty? Well, this is a service plan that is going to cover key appliances and systems in your home or rental. And it covers the cost to repair or replace those covered items if the damage is caused by normal wear and tear. If you’re not sure what constitutes normal wear and tear, we have a blog that you should read. It’s linked out on this page.

So when you get this deck by the end of the day tomorrow, click in. We will tell you everything you need to know about normal wear and tear. But for now, let’s step into what a home warranty does not cover. A home warranty is not going to cover these items that we’ve listed. So starting off with cosmetic problems, if there are dents, scratches, other purely cosmetic issues that don’t affect the item’s functionality, that won’t be covered. In the same vein, if there is misuse of the appliance or intentional human damage, let’s say you invited the baseball team to come practice their batting on your refrigerator, the damage that ensues is not going to be covered by your home warranty plan. Improper installation is also not going to be covered, nor will maintenance neglect issues, preexisting damage, costs that exceed your coverage limit, or external events. That last one might be giving you pause what constitutes an external event. Let’s say a car drives through the wall of your rental and hits your refrigerator. I don’t know why everyone’s beating up on your refrigerator, but that’s how it goes sometimes. That would not be covered under your home warranty. So there is a lot of confusion that comes up about home warranties versus insurance plans. And to help illuminate that difference, we have another poll.

Samantha Yadav:

Yeah, so here’s that poll. Got two questions this time. The first question, landlord Larry’s rental was infested with bed bugs. Would a home warranty cover this situation? Then the second question, the range in landlord Lisa’s duplex burnt out suddenly. Would a home warranty cover this situation?

Krista Reuther:

Man, landlords Larry and Lisa are sure facing some hard problems right now.

Liv Coffman:

All right, both of us are absolutely terrible.

Krista Reuther:

Yeah, truly. We’ll give you about 20 more seconds to let your thoughts be heard, and then we will explain each one so that we can make sure we all know the difference between what you would expect a home warranty to cover and what. All right, five, four, three, two, one. End.

There we go. Okay, so it looks like with the first situation and the bed bugs, most of you said no, this would not be covered under your home warranty plan. Liv, does that sound about right? That does sound about right.

Yeah, those pesky bugs, they are not covered under the plan. And then for question two, you guys are some smart cookies. If a range burnt out suddenly, the home warranty plan is very likely to cover that and let you repair or replace it. All right. So, here we are again, landlord insurance and home warranties. So according to house method and the balance, you can really tell the difference in insurances versus home warranty plans in two ways. One is considering whether or not it’s required, and the other is what it covers. So let’s start with whether or not the policy is required. When it comes to insurance, you are required to have some kind of insurance policy covering your properties interior, exterior, and liabilities. That’s going to be required by your lender in most cases. I’ve never heard of a case where someone could purchase a property without some form of insurance on deck.

So thus, this one is required. Landlord insurance, you would probably expect to pay between $2,650 and $2,766 per year for that policy. Unfortunately, there’s no average cost for landlord insurance, which is why we have an expected rate here. And this rate is actually based on the cost of homeowner insurance, since that tends to be 10 to 15% less expensive than landlord insurance.

So we took the average cost of that, drilled down for this expected rate. On the other hand, home warranties are not required. They are optional. And like we’ve said, and we will continue saying they will cover appliances and major home systems like the plumbing, electric, and HVAC systems from damage due to normal wear and tear. The average cost for a home warranty plan is going to be about $600 per year. But I do want you to keep in mind that this is the cost for a single property. If you have, let’s say, four multifamily properties around town, your price is going to be different than what you see here.

And there are a lot of different factors that go into figuring out that pricing. So don’t be afraid to ask questions. We’ll even help you figure out which questions to ask in the presentation. And of course, if you want to learn more about landlord insurance, we have a resource for that too. So click in when you get this deck.

But for now, let’s talk about what each of these plans cover. I’m afraid to click too much. But we’ll know because it will say part two, which is very exciting. It’s always good to have a visual cue. There we are.

All right. So a really clean way to distinguish between insurance plans and a home warranty service plan is that insurance pays for unexpected damage. See here, it’s like damage caused by outside forces, fires, termites, a burglar, the roof falls in. All of that would be something that you would go and talk to your insurance company about versus a home warranty. That pays for the cost of damage that you would expect to incur because it’s just normal wear and tear. So insurance is unexpected. Home warranty is expected costs. That’s a good way to separate the two in your mind.

Liv Coffman:

I always show insurance covers what we hope will never happen and home warranty covers what will inevitably happen or what will happen between one and two times every single year. Well said.

Krista Reuther:

Okay. So I know I’ve thrown a lot at you. We are going to get into some frequently asked questions here, but I’m curious if there’s anything popping up at the moment that we should go over. Yeah.

Samantha Yadav:

One question has come in. What is, if we can touch on quickly, the difference between the landlord insurance and the renter’s insurance?

Krista Reuther:

Yeah, absolutely. So landlord insurance is going to cover you as the landlord and the property itself. Renter’s insurance covers the renter’s belongings and any kind of liabilities that they might run into as a renter. So landlord is property insurance. Renter’s insurance is more personal belonging insurance.

Samantha Yadav:

Perfect. And then we have one question that came in through our Q&A here. This may be answered later, but just to keep it in your mind, I’ve just purchased my first multi-unit property, three units. What I need to have three separate warranties or will one warranty cover all three units.

Krista Reuther:

That is a good question. Liv, is that something that you could tackle?

Liv Coffman:

Totally. So when you work with the Armadillo team, we’ll customize your coverage on a per unit basis. We want to make sure that you have appropriate coverage per unit. Sometimes they’re different. I’ve spoken to landlords that have different appliance sets and different sides of the house. So we can fully customize that coverage to make sure you’re getting what you need and that you’re really, really happy. So yes and yes.

Samantha Yadav:

Perfect. And then we have one more come in before I scoot you along. Would a home warranty cover malfunctioning smoke and CO detectors?

Liv Coffman:

That is a big question. Will you repeat that? Sorry. Yeah.

Samantha Yadav:

Would a home warranty cover malfunctioning smoke and CO detectors?

Liv Coffman:

So it depends. That’s one of those things where we would have to have the diagnosis done by the service provider and look at the root cause of the issue. So I don’t want to speak specifically to that scenario, but in a lot of cases when we’re looking at the systems and appliances that impact those things, the answer will be yes, but sometimes it will be no.

Samantha Yadav:

Perfect. I think we’re caught up for the moment if we want to scoot along.

Krista Reuther:

Beautiful. Thank you so much. All right. So let’s jump into some frequently asked questions. Now, when I was inviting all of you lovely people to join us today, I had a field where you could enter questions that you had. So we drew some of these questions from those lists, from that list that you sent in. Starting off here, are home warranties worth it?

It’s a big question. The financial situations are going to differ between landlords, but throughout my research, I feel like the answer is yes. If we look at the numbers for how much maintenance costs landlords per year, along with the stress that goes into making sure that all of the Ts are crossed and the Is are dotted, I think having a home warranty service plan saves you a lot of stress and some money.

We’ll go into the pros and cons later, but what I want to focus on here is again, just going back to the data. So annually, property owners should expect to pay between 1% and 4% of the property’s purchase price in major repairs on average. And that’s just average. If you have been in the unfortunate situation where you’re about to start the season and let’s say your AC blows out, you’re in for quite a bit of money to get that fixed and you do need to get it fixed. And as we have learned through surveying you guys, most landlords actually take on maintenance management themselves. So over three-quarters of you take that on and put that stress on yourself, which means if you had a home warranty service plan, maintenance would become more manageable. Also, if you wanted to fact-check the $6,000 annual spend on maintenance here is where you can do that when you get this deck. It’s pretty interesting stuff, but that is quite a bit of change to have just lying around. And if you have more than one unit, it really starts to stack up. That’s why to me, the answer is yes. All right.

Liv Coffman:

So let’s talk about it. How many people are working from home today? I think about myself, I think about the two other folks on the call. A lot of your tenants are working from home. We’ve seen since 2020 this crazy influx of people using their appliances and using their systems with way more frequency than ever before. So naturally, the excess wear and tear is going to happen more and more. And as things have gotten more expensive, again, since 2020, those maintenance costs of one to 4% of your property’s purchase price have just gotten a little bit higher. So when we’re looking at all of these things, ranges, water heaters, plumbers, all of these things in my mind have very, very large dollar signs that you could avoid with a little bit of extra help from a warranty partner like us at Armadillo.

Krista Reuther:

Well said. It always floors me just how many systems are in a place that I live and really breaking it down like this makes me think, oh my God, that’s quite a bit of change.

Liv Coffman:

Someone said I spend triple to quintuple on home maintenance. So your $6,000 cost is real in my experience as a landlord over 25 years. Thanks for that. Wow.

Krista Reuther:

Thank you for weighing in. All right. So breaking this down further, let’s look at the pros and cons of a home warranty plan. So of course, starting off, if you have a plan, you’re going to save on inevitable costs for covered items. Like Liv said, appliances break once or twice a year minimum.

Things go wrong. So if you have a plan in place, you can be proactive instead of reactive and end up saving money. Additionally, having a home warranty plan makes maintenance more convenient, especially a plan like Armadillo, which will give them their time to shine, where they coordinate the conversation between your tenant and the contractor, which also saves countless hours of follow-up and makes sure that the actual root issue is addressed as quickly and painlessly as possible. That makes your tenants happy because it gives them a more seamless experience of renting your unit. And it makes them feel more appreciated because you’re quickly addressing the issue so that they don’t have to live with, I don’t know, a garbage disposal that’s like spewing smoke. That just sounds terrible.

I don’t know how it happened. I am not a maintenance man myself, but maybe someday. Of course, there are cons to a home warranty plan and it pays to be aware of those. So one, it’s not a free service.

You will have to pay a service fee and/or deductible depending on your plan. And it’s entirely possible that somehow you struck out you’re very lucky and you have indestructible appliances and systems that are never going to break down. So you would never need a plan at all. Unfortunately, I don’t think many of us have stumbled into indestructible appliances. So the likelihood is that you’re going to need a plan like this at some point.

Something else that’s worth considering here is that home warranties are actually pretty eco-friendly because they encourage people to repair items rather than just replace them off the bat. That can really pile up in a positive way. So according to the US public interest research group, Americans put out 6.9 million tons of electronic waste per year. The average family generates 176 pounds of electronic waste per year.

And so that really adds up. If we focused on repairing instead, we could reduce household spending on electronics and appliances by 22%, which would save the average family about $330 per year. Having that multiplied across the 122 million national households, repairs could save Americans a total of $40 billion annually. That’s not chunk change.

Liv Coffman:

And one thing I will add is when it needs to be replaced, I’ve heard from so many homeowners and landlords that because they have the financial support of a home warranty, they can actually upgrade to a more expensive system that maybe they wouldn’t have otherwise put inside of their rental property. That’s more energy-efficient and more focused on the environment because they had a little bit of extra cash to do that replacement. Beautiful. All right.

Krista Reuther:

So how can you make sure that you are following the process of how home warranties work? Well, it’s simple. This slide is for you. So we’ll keep it general and then live has been kind enough to break down how it works with Armadillo. So by and large, you have your first home warranty claim, you’re ready to go, you’re going to want to contact your provider. They will dispatch a contractor to come out and diagnose, repair, or possibly replace the issue at hand. You will then have to coordinate communication between the

between the contractor and your tenant, making sure that you get all the scheduling worked out, that they understand who pays for what, you will then pay for the service fee or deductible. So the contractor will fix the problem, fingers crossed, although you will want to follow up with your tenant to make sure that the fix or replacement actually worked.

And then of course, unfortunately, if the fix or replacement didn’t work, you’re going to have to repeat the cycle until the issue is resolved. Now, how does this work with Armadillo?

Liv Coffman:

All right. Well, before we get into all the fun stuff, I’ll give you a high-level overview of how it works. I’m going to show you guys something that is a personal favorite of mine.

I think they’re really cute. For every unit that you onboard the Armadillo program, we give you one of these refrigerator magnets that has a QR code on it. This has our direct number to our team of 24-7 home pros. Or if you’re like me, you want to do everything on your phone, you like Google, you like Amazon Prime, you can scan the QR code and you can request service completely digitally. So those are the ways that you’re going to contact us.

We can meet you where you’re at. If you don’t want to talk to anyone ever, we can do it via text or you can pick up the phone, talk to someone, and make sure that you’re actually putting in a claim that makes sense for your property. Our home pros are there 24-7 to make sure you’re advised in making a claim that makes sense.

B. So with other incumbent home warranties, typically you’re kind of stuck with the network of service providers. We give landlords full autonomy to say, “I want to have Armadillo do this from start to finish.”

Again, I want them to do it. I pay for a service. I want them to service my home and we’ll send out a qualified contractor. We’ll take them to your property. We’ll coordinate with your tenants on your behalf if you would like that. We’ll take all of the stress off of you with our network of home pros. Or if you’re like a lot of landlords who are kind of localized, you have properties that are close to home. Sometimes you already have really strong established relationships with service providers. You have Joe Schmoe, one, two, three plumbing. That’s a terrible name for plumbers.

Sorry if there’s any Joe’s on the call. But you’ve used him for 10 years. You want to continue to give him your service but capitalize on the benefits of a home warranty financially. You can use our technicians or you can use your own. Like Krista mentioned, we do have a service fee and/or deductible. You’ll see that word kind of varying among providers.

So they are the same thing. You do have to pay that to accept a claim. We charge your service fee on the date of service and/or if you use your own service provider, we’ll deduct it from your reimbursement costs for that claim. The contractor or the home pro is going to fix the issue. Whether that is a repair or replacement, we’re going to attempt to repair it first. But if it’s an unrepairable item, then we’ll step into a place where we’re looking to replace it and we’ll help you replace it or we’ll give you the cash to pick out your own. And point E, we’re going to pay for covered repairs and replacements up to the limit of liability that we’ve chosen for your home.

To my point earlier, we can decide for your unique rental properties based on the value of your appliances, the value of your home, what limits make sense so that you can get replacements with the same like kind and quality that you have today.

Krista Reuther:

Fantastic. All right. And I think we are lucky enough to actually be able to see this in action. Yeah. All right. So let me just press a button here. So I am sharing the sound.

Liv Coffman:

I could actually voice over it if you want to mute it. That might make more sense. Okay. Heck yeah. All right. You, my CEO, Matan, you’re a very lovely human, but I’m going to voice over it. There we go.

Okay. So as you can see, he’s on his phone. He’s using the digital way of filing a claim.

This is completely digital. He’s picking what appliance is broken. I think that he picks a refrigerator. From here, you can scan your appliances. So we have those uploaded in advance or you can put in the serial numbers. We give you tons of options on common things that are happening to refrigerators or other systems in the home. But if you want to add more context or give us some detail or let us know, “Hey, this is an emergency situation. This is what’s happening,” you can add a free form message and say, “X is happening with my refrigerator. Please come out tomorrow.

Please come out this day.” From here, you’re selecting a couple of different timeframe options that you and your tenant are available to either be on the property or not. If those times end up not working, we can coordinate again with you and your tenant on behalf of Armadillo and make sure that there’s someone on the property and that we’re going to be able to handle this quickly. From there, we put in your credit card information.

You are not charged that deductible until the service appointment actually happens. Super, super important. And then it’s done. That took like 30 seconds, 45 seconds. You’ve completely submitted a claim. No hassle, no call centers. And now you’ve gotten a tracking link to your email so you can track your claim in real time. Amazing. Easy peasy. I put two minutes. If you’re a little bit slow on your phone, it’s going to be two minutes. But if you’re quick and efficient, you can really handle this for your tenant super, super quickly.

And I put this note here. What if I want to use my favorite plumber? I guess for some reason I love plumbers. If you have trusty pros that you’ve used on your properties for years, we are not going to make you wait four, five, six weeks to get a check in the mail for that service. We’re going to reimburse you that same week, sometimes even same day, via Venmo, via PayPal. We have functions in place to make sure that you’re getting your money back for that service extremely quickly if you’ve paid that service provider.

Krista Reuther:

Amazing. Thank you so much for breaking that down for us. And oh, it’s showing us again. Let’s go. Technology. It’s so fun and fresh and sometimes just wants to focus on all of the cool stuff we can do. Alright. But if you’re anything like me, you’re probably sitting there wondering, well, how do I choose a home warranty plan? And the answer is to be very inquisitive. You want to ask a lot of questions, make sure that you understand what you are purchasing and what it covers. So I would recommend asking all of these questions.

We have a couple more on the next slide. But ones I want to specifically highlight here, you want to know how much your deductible or service fee would be and what the cost of the service plan is per month. Also, something that came up a lot was a question of whether or not home warranty plans were tax-deductible. Liv, do you want to speak to that?

Liv Coffman:

Home warranty plans are in fact tax-deductible. This is a huge perk for landlords. Yay. Big yay for that.

Krista Reuther:

Absolutely. So again, we will send this over to you so that you have all of these questions in tow. You can feel really confident as you’re having these conversations. Something else to keep in mind are questions about actually submitting service requests.

So of course, we’ve gone through and shown you how to do it with Armadillo. But if you are looking to shop around, make sure you understand how you would submit your service requests and how quickly they’re answered. You’re also going to want to make sure you understand if there are any limits in terms of the number of service calls you can make because that is going to be very important.

And you don’t want to run up to your last service call and be told, “oh, no, can’t come out. Sorry about that.” So definitely keep that in mind. And very importantly, have I read the fine print? If reading fine print does not sound like a good time to you, that’s a little weird.

Just kidding. Actually, according to a survey, 99% of survey respondents didn’t read fine print and they accidentally agreed to surrender the naming rights of their firstborn child as a result. Paying attention to the fine print is quite important. Here’s an example of some fine print from our friends at Armadillo. All right.

Liv Coffman:

So fine print is to Krista’s point, terrible. Who wants to sit on their couch and read a 15 page contract to understand how it’s going to work for their tenant? Not me.

I doubt any of you would like to do that. I’ve personally read a lot of home warranties because I’ve been in this business, but we, as Armadillo decided that we could take a little bit of a different stake in the way that we cover things. So I’ll talk about it some on the next slide, but we removed a lot of that fine print, that noise that makes claims just get excluded. I saw a comment in the chat earlier that was like, I filed a claim for this and they came out and it was excluded. This was an uncovered item that happens all the time with warranty products and we felt that we could do it a little bit better. So our contract as a whole is only two pages. This is the paragraph of exclusions. You could read that in about two minutes and really understand how your warranty is going to work for you and your landlord or you and your rental properties.

Krista Reuther:

Absolutely. Oops, speedy consolence. There we go.

Liv Coffman:

Part two of that slide. The other guys, we really, really looked at the industry and there are a lot of great players out in the space, but we’re a new age of home warranty. We sometimes even joke that we’re the anti-warranty company for landlords because we’ve made really conscious decisions to just do things a little bit differently, from fine print to service, to giving landlords and homeowners full flexibility and autonomy to the way that we support them. We looked at the industry with a lot of depth before developing our product to really understand the key complaints that landlords and homeowners had today. We, as average nerds over here on the Armadillo team, aggregated all of that data and we removed over 80% of what’s typically excluded in a warranty.

That’s a very, very large number. There’s typically fine print all over some of these contracts. I’ve seen the weirdest, most nuanced, specific to an appliance brand exclusions in some warranties.

It’s crazy. Some of them have very large general exclusions and then another paragraph of exclusions per category. So you have refrigerator coverage. Here’s what’s not covered for your refrigerator.

It’s just confusing. It doesn’t result in a good consumer experience and we wanted to avoid it. Like you saw on the digital app, you can request service in less than two minutes at any time. A lot of our incumbent partners have long call center lines with terrible hold music and just old school experience.

Flexibility, like I already mentioned it, but I’m going to sing the song and dance again. You can use your own service provider or we can do everything for you from start to finish. And 24 seven support. We’ve had New Year’s Eve refrigerator breakdown emergencies that have had someone on the other end of that phone line.

So we are here to support you as a landlord in your tenants 24 seven, 365 other warranty companies are sometimes limited to those eight to five or eight to seven call centers. I like what I’m hearing. And yes, David will send you our phone number. Awesome.

This is my slide too. So this is just a couple of highlights of how it looks as a landlord. You have the digital phone interface, but something I love to highlight is if you’re a landlord with multiple properties, someone asked a question earlier, do you have to have multiple plans for different units? The answer to that is yes. But as an example on the left side of the screen, we can see 1059 West Main Street, 13 Cornelia Street, each different unit has the ability to file claims and you’ll have all of those separated. So you’ll be able to manage your liability limit per year. Each unit is going to have separate coverages. So you’re not getting those intermingled.

You’ll know exactly how much you have left in coverage per unit and be able to manage those all separately and really have a deep understanding of what’s covered on each of those properties in an easy place to manage. I mentioned the tracking links. This is what they look like in real-time. You can track that claim from start to finish in an app, but technology is great. Love technology. I use it all day long, but having really good people on the other end of your issues is super important and is a huge ethos of Armadillo.

You have a dedicated home pro to every single claim that is an Armadillo stakeholder who will walk you through the experience, educate you on what’s covered, how it’s covered, when you’re getting your reimbursement. So we have the cool, fun technology, the awesome QR codes, but you are also paired with really, really great people.

Krista Reuther:

Very great people, I would say. Personally vouched.

Liv Coffman:

Okay, case study time, personal favorites. So on the left, just before we dive into this real landlord scenario that happened recently, this is the average repair and replacement for some of the things that home warranties cover. So plumbing, air conditioning, oven and range. We love the range.

We talked about it earlier. Refrigerators, water heaters. These are large dollar amounts. This is getting two claims are pushing us up on that $6,000 a year. We see on average with landlords and homeowners 1.67 repair or replace claims per year. That’s significant loss to your revenue and your bottom line. This is a really great case study of a refrigerator claim that happened recently for one of our landlords.

He has five units with us and refrigerator is broken. It was leaking. We had to go out there, figure out what was wrong, and we decided this doesn’t need to be replaced. It just needs to be repaired.

But that repair was still pretty expensive for $1,447 .66. That is a lot. So some of that is labor. Some of that is diagnosis. Some of that is the valves, tax, PCB lines, but all of that leads to a pretty large dollar amount.

And if that’s not something you’re expecting in a given month, that’s frustrating. So this is what he would have paid if he did not have our service. But this is what he actually paid. It saved him $1,347 .66 because he paid his $100 deductible and we covered all of the other expenses. But expenses are great.

We can help with those, but it also saved him a lot of time and stress and coordinating with a tenant and just a lot of headache. I mean, yeah. So that is my case study for the day. We see claims that are kind of all over the spectrum of reimbursement. Some of them are very, very expensive. Some of them are a couple hundred dollars, but it all adds up.

Krista Reuther:

Absolutely. And in this economy, too, it’s not the time to be throwing money away if you don’t have to. Not in this economy. All right. Liv, I’ve got to ask you the final question. Are home warranties a scam? Nope.

Liv Coffman:

Personally, I’ve staked my life on home warranty. So I very much believe in home warranties. I’ve seen the good that they do in humans lives. And I believe in home warranty in general. But I know that what we have to offer at Armadillo is really special. I get to talk to our landlords often. I get to see the beauty that it brings and the savings and stress that it alleviates.

So not a scam can actually be a pleasant experience. Crazy. Who likes filing claims? I think we do a great job. So I’m excited to meet some of you guys and hopefully give a not-scammy product to you. Beautiful.

Krista Reuther:

Yeah. I think really knowing what you’re buying, feeling confident enough to ask questions and flesh out whatever deal you’re getting is really important. Armadillo has been lovely to chat with. And I’m not the only one who thinks so. In fact, here are some reviews from landlords and homeowners.

Liv Coffman:

Not going to read these two, but you can read them once the slide deck hits your inbox. But I think we do a great job. We really cultivate incredible experiences with our landlords and our homeowners. And it’s a part of our ethos. So five star reviews are not shy in our world. And I just thought I would share. Beautiful.

Krista Reuther:

Well, thank you so much. Now we have time to take some questions. Samantha, what do we have in the queue?

Samantha Yadav:

Yes. So the question that keeps coming up is about the service times and expectations. So once somebody submits a claim, when can they expect to have a provider? How soon can they have somebody there?

Liv Coffman:

Very great question. So we have, we obviously have different SLAs for like emergency situations versus maybe your ICE machine is not making ICE. But our typical SLAs are we have a service provider in home between 24 and 48 hours. Unless it’s an emergency, we need to get someone out there way, way quicker. On the flip side of that, if you use your own service provider, like I did over the summer for my HVAC claim, I had someone there in one hour because I hot dialled a lot of people and made the first person available come out. And then I was reimbursed on Monday because it was the weekend. So we have a lot of triggers internally to make sure that our emergency situations are handled with excess speed. But our average SLAs just a couple of days and our reimbursements are also usually just a couple of days. Once your claim is done, you’ll have your money right back. Perfect.

Samantha Yadav:

I’m going to go ahead and launch this poll while I grab the next question. If I use my own contractor, this is a multiple part question. Number one, is there an approval process for them? Number two, is there a cap that you pay? And then number three, am I able to see a list of armadillos vendors in my area?

Liv Coffman:

Great question. So question number one, is there an approval process? When you file a claim using your own provider, we give you a pre-approved dollar amount. We’ll send you full instructions on exactly what you need to do, what type of paperwork you’ll need to get from your service provider, but we also give you a pre-approved dollar amount. If it’s above that dollar amount, if it’s going to be a larger claim, we’ll encourage you to have your home pro call our home pros while they’re on site to get that approval process really quickly so that we can go above that pre-approved dollar amount and get the rest of it approved. That’s typically a very, very simple process and no sweat on your back to make your service pro do the call. So yes. And then part two, what was part two?

Samantha Yadav:

Can I see a list of the local contractors or vendors in my area that Armadillo uses?

Liv Coffman:

So we don’t have all of that on our website. If you want to chat about that with me individually, we can help you get connected with the right service providers in the right places. And again, you can also use your own. So you have full control over who comes out. If you would like, we do have a very scrutinous vetting process.

We work with the best of the best in terms of service providers. So folks in all 50 states, I know I saw some questions around, are there some in Minnesota? Is there some in Utah? We do have our product available in all 50 states, and we have most zip codes covered. I think it’s like 99% of zip codes covered. So sorry if you’re in that 1%, just kidding. But no, we have folks for most of the things covered in our product in 100% of zip codes. But if you’re in a very rural area, sometimes, sometimes it might take a little bit longer.

Samantha Yadav:

Perfect. And as a reminder, we’ll send everybody a recording of this webinar with more information on how to get in touch with Armadillo. If you use TurboTenant, you’ll find information on Armadillo in the toolbox of your landlord portal.

Next question. I’ve seen a lot of warranty plans that do not cover improper installation. Is there a determining factor for an installation issue or an appeal process for something if it was deemed to be an installation issue by one tech, but not another?

Liv Coffman:

That is when our team would work really, really closely with the tech to get the correct diagnosis. Again, that’s one of those claims that’s kind of situational. So I wouldn’t be able to give a very generalized answer. But when we’re working with the home pros, we’ll work with our reputable folks. And if they’ve given the advice that something needs to be covered, we’ll get it covered. Perfect.

Samantha Yadav:

If the appliance is repairable, can I request the repair check and pay out of the pocket for the rest if I want to replace it? Absolutely.

Liv Coffman:

That happens all the time. Some folks are like, you know what, just hand me the money. I want to take care of it on my own. A lot of times, for replacements too, landlords will say, can I just have that dollar amount so I can go and shop it around and pick out what I would like? Absolutely, yes. Nice.

Samantha Yadav:

How long is the waiting period before coverage starts with Armadillo?

Liv Coffman:

Very great question. We have a 30-day waiting period on all of our plans. So if you purchase your plan today, it will start in 30 days from today. And then you’re able to file claims.

Samantha Yadav:

Perfect. And then here’s a question about specific items. Would a ceiling fan, bathroom fan, and/or furnace be covered with a warranty? So if we just want to touch on again the difference between a warranty versus insurance coverage?

Liv Coffman:

We have a suite of products that we can customize for you. We have a really great plan that we offer through TurboTenant. But if you need extra things on it like ceiling fans, which is a covered item, yes, we can customize your coverage to make sure that you’re getting the things covered that you would like. We have multiple different plan tiers that we can put you in to fit your needs. Perfect.

Samantha Yadav:

Let’s see here. If an appliance can’t be repaired, as in there is no part, could you pay for a replacement? Or would Armadillo pay for a replacement?

Liv Coffman:

If it can’t be repaired, then it will be replaced. Nice.

Samantha Yadav:

Okay, so we’ve got some questions coming into the chat here. So do you provide a multi-year policy?

Liv Coffman:

For existing homes, we have month-to-month plans and an annual plan, but they are on an annual term basis. We will renew you in the next year. So you’ll get your renewal typically 60 days before at that same monthly rate or that annual rate. But if you’re purchasing a new home, we do have annual plans available. But that is only in the case of purchasing a new home. So if you’re already on the property, it’ll be a month-to-month or an annual plan.

Samantha Yadav:

Are service fees and deductibles also tax-deductible in addition to the home warranty plan fee? I don’t know. I do not know that answer.

Liv Coffman:

I will come in our follow-up if someone wants to drop me that email address. I can follow up with you directly. Got it.

Samantha Yadav:

Let’s see. When you call to set up your warranty plan, do you need to have all of the serial and manufacturer numbers on the initial call, or the number of the appliance? What information do you need to set up?

Liv Coffman:

You need your first name, last name, email, phone number, and property address. From there, we’ll chat. We’ll figure out what plan works for you. Afterward, you are more than welcome to upload your serial numbers and your appliances just so that you have them all housed, but not a requirement by any means. Perfect. It’s a way simpler purchase than insurance. We don’t need a ton of information upfront. Absolutely.

Samantha Yadav:

Do your vendors and contractors come out on weekends?

Liv Coffman:

They do. We have what we call internally a yellow booking process. We have claims, Armadillo Homes Pros, who work over the weekend. If there’s an emergency situation, we’ll get someone out there regardless of what day of the week it is.

Samantha Yadav:

In scenarios where you use your own person for repairs, is it best practice to have them do the work or wait until the warranty company approves the work?

Liv Coffman:

Great question. The best practice is to file the claim first because we’re going to give you all of the instructions, and that way we’re notified so we can match up the date of service with the date of the claim. That is an important thing to pay attention to. If you know that something is wrong, file the claim. Let us know that it’s happened so that we can document it in our system. We’ll give you those instructions. If it’s under that pre-approved, you don’t have to give us a call. But if it’s above that pre-approved dollar amount, you will need to give us a call to make sure that we can cover as much as possible for you with all the contacts needed.

Samantha Yadav:

Perfect. What is the average annual cost range for a warranty service?

Liv Coffman:

Great question. It depends on what you want covered. We have plans that are $29 a month. We have plans that are $109 a month. There’s really something for everyone. Our lowest-cost plan I think is like $360 a year somewhere around there, so lower than the national average. But across the board, we see plans averaging about like $550 to $700.

Samantha Yadav:

If you’re on vacation and not available, would your claim be addressed before the deductible has been paid?

Liv Coffman:

Sorry. I’m just trying to think about how to get it. Could you reread that question for me?

Samantha Yadav:

Yeah. If you’re on vacation and not available, would the claim be addressed before the deductible has been paid?

Liv Coffman:

So the way that it works is if you file the claim, you are not charged that deductible until the date of service. So it’ll get charged through us if you’re using our network on that date of service. So that $100, $75, whatever deductible we align on. If you’re using your own service provider, it’ll just get deducted from that total reimbursement. So if you are on vacation, you file a claim and you book service in advance, you’re not going to get charged it until that service appointment actually happens.

Samantha Yadav:

Nice. Okay. So someone has mentioned that they took a look at our link, but if they want to tailor their plan, how would they go about doing that to bulk it up for what we offer? Make it a little bit larger.

Liv Coffman:

A very interesting question. If you’re on the website, there is like the get covered button at the very bottom, or it says get covered for my properties. But then it says if you want customized coverage for your properties, talk to an Armadillo Home Pro and guess whose calendar it takes you to? Mine. You can chat with me directly and we’ll get you set up.

Samantha Yadav:

Can a tenant file the claim or does it have to come from the landlord?

Liv Coffman:

However you want to handle it. We’ve had landlords be like, I’m going to put this refrigerator magnet. Here’s the sign on. If something happens, I trust you, just let me know. As a previous tenant of a property that was an Armadillo-protected home, my landlord was out of the country. He was always vacationing. I think I financed his vacations. But he was like, you can just log in.

You can do it. I coordinated with the service provider directly. They came out, charged him easy peasy. But that’s just up to you and your tenant. So if you want to give them that responsibility, we can coordinate with them directly and make it super easy.

Samantha Yadav:

Perfect. And you’ve included your calendar link in the slides that everybody will receive tomorrow. But if they were to contact Armadillo on another day, not using your link, what is that customer support process like?

Liv Coffman:

For purchasing or for claims. Either way. Well, if you’re a landlord through TurboTenant, you’ll probably get routed to me. But if you reach out to our team, you can do that in a couple of different ways. On our website, there’s a chat where our Armadillo home pros live. So you’ll meet folks like the lovely Taylor, the lovely Mario, folks who can answer your questions in real time and they’ll get you put in the right spot. Again, you can call us. We’re going to pick up the phone, whether it’s a claim or just a general question, pretty much, anytime during the day. But that chat is a really great place to go in and ask questions and then get routed to the right direction. Or you can reach out to me directly.

Samantha Yadav:

If a repair person comes multiple times for the same fix, do I get charged multiple times? That’s if they’re repairing the same thing over and over again.

Liv Coffman:

We don’t like that. We try to avoid that at all costs. We try to make sure that doesn’t happen. But if that does happen and it’s the same issue, we run into situations where that has happened occasionally. I want to make sure that you’re not paying a deductible over and over and over for the same issue. So most of the time we’ll just waive those unless it was like six or 10 months later.

It really just depends. But if it’s the same issue, you’re not going to have to pay over and over and over again for the same issue. We’ll make it right by you.

Samantha Yadav:

Let’s see. Does your service haul away old appliances or upgrades to meet code?

Liv Coffman:

Great question. Code upgrades are not covered. That is one of the things in those terms and conditions that is not a covered item. So if in that will happen if there are extra access charges to bring a system up to code, those elements are not going to be covered. Hauling away appliances, it’s sometimes looped into that labor rate because the service providers are the ones who are doing that. So on a case-by-case issue, yes.

Samantha Yadav:

Perfect. Let’s see. Someone else is asking if there are discounts for multi-unit complexes.

Liv Coffman:

We have lots of different price points for different tiers of units. So that’s where you’ll work with us directly and we’ll make sure you get the right pricing for your units directly. So yes.

Samantha Yadav:

Is the deductible the same as the service call fee?

Liv Coffman:

Yes, those words are synonymous. On the website, it’s deductible. Some folks will call it a service fee. It’s the same thing. Perfect.

Samantha Yadav:

Let’s see here. We might have caught up. Oh, two more came in. Let’s see. If a repair requires opening the wall or ceiling, would repairing the wall also be covered? It would not be, no. Okay. Do HVAC repairs include refrigerant retrieval and disposal if required?

Liv Coffman:

If required, yes. Unless that’s indicated that it’s a code upgrade and that’s the reason that it’s happening, but that would fall under the HVAC terms and conditions.

Samantha Yadav:

Okay. If I’ve lost your question in the chat here, please feel free to resubmit your question either in the Q&A or the chat. Got one more. Oh, are appliances the main items covered?

Liv Coffman:

Great question. Depending on your plan type, it can be appliances, plumbing, electricity, other things covered. It really just depends on what your priorities are for coverage. Most landlords, every landlord has appliances to some extent, so the landlord plan is a really great one-size-fits-all, but if you need more than that, that’s an option.

Perfect. Tracy says, but California is really expensive. Yes, California is super expensive. Even though those pre-approval rates are the same across the board, your total liability limit is totally up to us. If you say live, California is really expensive.

I know what the service providers here are going to be charging. Let’s get you in a plan with higher liability limits to accommodate those differences just because that pre-approval is, it’ll be a naturally smaller amount than your full coverage. Once we get the rest approved, it’s not going to matter. You’re going to have up to that liability limit in total coverage, so it will get covered.

Samantha Yadav:

Okay. For a short-term or mid-term rental plan fee, is it more than a regular rental? No. Short-term or mid-term plan. Okay.

Liv Coffman:

So, if it’s an Airbnb or if you have people coming in and out of your home, we have folks who use Airbnb who use our service, there’s no cost difference. Our plans are the same across the board and you can use them as you would like. Perfect.

And I think, oh, go ahead. I was going to say to that point, folks who are using short-term and mid-term rentals typically sometimes have more excess wear and tear on their appliances because you have a lot of folks coming in and out, so a very strong use case for the product.

Samantha Yadav:

Got the last question here. Is it true that people attending the Zoom meeting get a big discount on the home warranty program? I believe no, but the benefit of attending live is that you’re going to get these or register, you’re going to get these slides and you get indirect contact with Liv.

Liv Coffman:

Plus, TurboTenant folks, if you’ve been on the landing page, you see that we have a really great price already on the TurboTenant landing page. So, just by being a part of this wonderful ecosystem with our friends at TurboTenant, you already get some special treatment from us.

Samantha Yadav:

And if you want to find that Armadillo information, again, that’s in your landlord portal under the toolbar, and it’ll be in the follow-up email that we send tomorrow.

Krista Reuther:

Absolutely. All right. We are right at time, and I don’t want to keep people away from their snacks. So, Liv, thank you so much for joining us. You have been a mastermind. We were enchanted to meet with you and learn everything we could about home warranties. Samantha, as great as always. And of course, landlords, thank you so, so much for attending today. Please keep an eye on your emails. We will be sending this deck along with the link to Armadillo’s plan so you can check those out. If you have any questions, feel free to reach out. Otherwise, I hope you have a great rest of your day.

Liv Coffman:

Thank you guys for having me. And don’t forget, summertime is a very cruel summer for systems and appliances. So, it’s the perfect time. Cruel summer.

Krista Reuther:

Thanks so much, everyone.

Presenters

Krista Reuther
Krista Reuther
Senior Content Marketer
Liv Coffman
Liv Coffman
VP of Insurance and Partnerships at Armadillo
Samantha Yadav
Samantha Yadav
Landlord Experience Specialist

NEWSLETTER SIGN UP

TheKey is the weekly newsletter for landlords, by landlords.

Subscribe to get tips, news, and hacks for even the most seasoned landlords.

Education

More Resources and Tips

Join the 550,000+ independent landlords who rely on TurboTenant to create welcoming rental experiences.

No tricks or trials to worry about. So what’s the harm? Try it today!