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Beware of HomeServe repair coverage

Dear Answer Man, I got a weird letter from a company called HomeServe that says I have no repair coverage for the water service line at my home. Is this an approved service through Rochester Public Utilities?

Absolutely not. RPU has its own "protection service" and it's a lot cheaper than what HomeServe is pitching.

Here's the background.

Homeowners are responsible for any repair needed on the water service line from the street to the home. RPU offers insurance coverage called Service Assured for any repairs needed on the line. It costs $1.99 per month and it covers everything. RPU spokesman Tony Benson says the service is provided by RPU, not by an outside vendor.

The letters from HomeServe, also identified in the letter as Home Service USA Repair Management Corp., apparently went out to a lot of Rochester homeowners last month. They claim that on a "recent review of our service area" that the homeowner doesn't have coverage, and they offer it for $4.99 per month, with coverage up to $6,000.


On the face of it, not a good deal, compared with RPU.

Benson says the utility has had calls from customers who are confused by the letters and wonder if they're bogus. RPU has posted a copy of the letter from HomeServe on its website.

I did some legwork on Home Service USA Repair Management Corp. and they're based in Albany, N.Y. I called the Albany number and didn't get very far trying to talk to a corporate manager about the Rochester pitch.

HomeServe has caused issues recently in other cities as well. A quick Web search shows that city utilities in Pueblo, Colo., and Pleasant Hill, Mo. , have had to respond to customers who are confused or suspicious.

The Brigantine, N.J., Police Department has a website where it lists "Scam Alerts." Among those alerts is one regarding HomeServe: "Local residents are receiving mailers from a company called HomeServe for outside water line protection. Be advised that this is a private company, not a government sponsored or endorsed agency! It is not a mandatory fee or program. It is simply an 'insurance' or 'service contract' company. Do your research before signing up if you receive a mailer from them."

Good advice.

Last point: Is insurance coverage for your water service line a good investment? Benson says that RPU's Service Assured program had 70 claims in 2010. Sixty-three of them were for meter valve replacements, which would have cost the homeowner maybe $400 tops if paid out-of-pocket. The other seven were for larger repairs that involved some excavation and would have cost more like $4,000, he says. Again, with the Service Assured plan, they were covered by RPU.



I'M IN BILL'S DEBT:Bill Plummer, an Answer Man fan who keeps a close eye on federal budget and national debt issues, correctly notes that my otherwise magnificent answer regarding the federal debt last week needed fine-tuning.

"Nearly half of the debt is held by foreign investors," I wrote. Well, Bill says, if you call 32 percent "nearly half," that's true. Foreign investors have nearly half of the publicly helddebt, but for all federal debt, it's more like 32 percent.

I also reported on how the national debt went up or down during various presidential terms. I should have been more specific and said it went up or down as a share of gross domestic product, which is the commonly used parameter. As a share of GDP, the national debt exploded during Reagan's first term, slowed during Clinton's presidency, and shot up again during George W. Bush's term.

I owe you, Bill.

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