Popular Mechanics – How to Get the Most From Your Home Warranty

While written in April 2013, this advice from PM is pretty much timeless.

Suppose someone is considering buying a home…READ MORE

The National Home Service Contract Association (NHSCA) is a non-profit 501(c) (6) industry trade organization of member companies serving home service contract providers and consumer interests throughout the United States. For more great industry, media  and consumer information, visit  http://www.homeservicecontract.org or call 913-871-5600.



HomeWarrantyWiz.com Interviews Jeff Powell, President of NHSCA

August 7, 2012

Back in April HomeWarrantyWiz.com published an interview with Counsel for the National Home Service Contract Association (NHSCA), Art Chartrand. In today’s piece we meet the President of that same association. On behalf of First American Home Buyers Protection Jeff Powell is the current President of the NHSCA and I recently talked with him about his duties, the association, and its work. Thanks to Jeff for his time and for sharing more information about the association with readers who visit this website.

What are your duties as President?

My company, as a member of the NHSCA, actually holds the position and I represent them as the appointed person to fulfill the responsibilities given to the sitting NHSCA President. My role is mainly to facilitate, escalate, and prioritize the relevant issues the industry is facing among the association members. All of the member companies are represented by leaders who are highly experienced and engaged professionals in our industry. So the role of the President may imply a greater authority than the other members, but someone must be the one to press everyone to make decisions on issues and move on to new business.

How long do you hold this position? When is the next President appointed and how?

It’s a two year term. The most recent appointment was made at our annual meeting in Chicago this spring. The next President will be decided by nomination and vote by the members, with the likely successor being the current Vice President.

As President do you have a particular role in deciding or vetting new member applications from home service contract companies?

A new member committee decides on applications. That committee seeks to recruit new member companies and also handles the vetting process with new member applications. This process involves all the member companies giving feedback on a company that applies for membership in the association This vetting helps to demonstrate to homeowners which companies are operating legitimately and have the reputation that would best represent the industry’s best practices.

The member companies of the NHSCA include some big company names, your own company included of course. Is there any threshold in terms of customers served, contractor networks, or other company-size-criteria that would limit membership in the NHSCA?

No, there are no specific criteria but the majority of the major players in this industry are already members of the association. Smaller companies benefit though by being members and are welcomed if they meet the standards set by the group members. The experience and resources that the collective companies bring to the association are a great help to the companies that become members. This type of investment of financial and human resources, in the end, benefits the entire industry and that is the goal of the NHSCA.

Some service contracts these days are very specific in terms of what items in or around a residential property are covered. Are there limitations on what sorts of companies can become members of the NHSCA where specific service contracts are concerned, public utility water or sewer line service contracts for example?

The association would consider on a case by case basis any company that applies for membership. The ultimate decision relies mostly on whether the contract the company provides fits the definition of a home service contract. If the answer is yes then the company would be considered for membership.

In a press release this summer there was mention of a numeric coding system for the NHSCA’s member companies. This system seems like a great resource for home owners trying to verify that a home service contract company isn’t a look alike or sound-alike-company-name. Where exactly do your member companies display their NHSCA member number?

The member companies will each decide their own way of displaying the membership information, member number, NHSCA logo, etc. The association is more focused on cooperation than dictating to members how to represent their membership but most members will likely make their NHSCA member information available in their online and offline consumer-facing literature.

There was an article published online back in May in which you commented on the situation with shortages of the old coolants commonly referred to as R-22. For readers who are not familiar with the challenges that HVAC technicians have today getting sufficient amounts of R-22 refrigerants, can you please shed some light on how the changes with the Environmental Protection Agency’s regulations affect home owners whose cooling systems use those older refrigerants? How does having a home service contract pay off if a home owner needs repairs to the cooling system that require recharging with R-22 refrigerants?

The price of R-22 has increased significantly which has led to increased costs to repair air conditioners. A home service contract helps protect homeowners from these additional costs.


National Home Service Contract Association offers advice to homeowners and homebuyers on air conditioner mandates by EPA.

(Lenexa, KS). In 2010, the Environmental Protection Agency placed into effect a ban on the manufacture of new HVAC systems using R-22 refrigerant. R-22 refrigerant, more commonly known as Freon®, is used in systems such as window air-conditioning units, dehumidifiers, heat pumps and central air conditioners.

The purpose is to reduce the amount of hydro chlorofluorocarbons (HCFCs) emitted into the environment.  The EPA then added a gradual  production limits for R-22 refrigerant gas each year down to a total ban by 2020. After January 1, 2020, servicing of R-22-based systems will rely solely on recycled refrigerants or simply not at all. New systems must operate on an air called “410-A.  [Some have argued 410-A is just as bad for the environment, but another story].  The bottom line, if you have not converted your air conditioner to 410-A by 2020, you are going to feel the heat or put out significant dollars to upgrade.  You nd your real estate agent need to consider this development when pricing a new home.

Here is the issue  in a nutshell.  410-A cannot be utilized in older systems which previously used R-22 without making some substantial and costly changes to system components. Most new systems being installed today run on 410-A, but most existing systems still use R-22. Adding to the problem is many manufacturers have skirted the requirement in recent years by continuing to manufacture R-22 units but shipping them “dry” and having local HVAC installers fill with R-22 onsite. As a result, many HVAC professional have stockpiled R-22, but the price continues to rise in many areas to well over $100 a pound. As the price gets even high, consumers choice will be to pay over $1000 for black market or recycled R-22, or just convert to 410-A.  Neither may be in your budget.

“What is going to happen to the poor, those on limited incomes or even average middle class folks who don’t have perhaps $10,000 by 2020 to change out their air conditioners to 410-A?  Given the huge demand leading into 2020, won’t prices even go higher? Is Congress likely to sit by and let people die in the heat?” These are serious questions being asked by NHSCA Executive Director and Counsel Art Chartrand. Will the Trump administration delay the ban or offer other alternatives?

There are other gasses posing promise. Some are marketing R-421a from  RMS of Georgia marketed as Choice Refrigerant that claims it can replace R-22 with the same equipment. Everyone needs to carefully watch this and other new technologies that may affect this issue. Right now, most equipment manufacturers will not endorse R-421a as suitable.

Home service contracts provide service, repair or replacement for various items such as dishwashers, ovens, electrical and plumbing systems – and heating, ventilation and air conditioning systems (HVAC) – that become inoperable due to normal wear and tear during the contract period. Contracts do not provide coverage to upgrade units to meet new EPA rules, including 410-A, which could mean unexpected out-of-pocket costs to home sellers and buyers when replacement of an air conditioning system component is necessary.

“We wish to avoid consumers thinking or hoping that their home service contract will totally pick up this cost. The industry would love to,  but tis is akin to the government mandating all cars run on electricity. Car manufacturers could not cover that conversion cost under warranty. Home service contract providers cannot bear the cost of this huge and unproven governmental experiment either,” said Chartrand.  The good news is while the 410-A upgrade is not covered, the expense will often be far less with a home service contract in place says Chartrand. If 421a or other gasses prove worthy, then even more so. So prepare your existing home with a home service contract in place to help mitigate any cost. And be very aware when buying a new home.

 “We are recommending home buyers order a specific HVAC inspection to determine the exact life expectancy of the system – that is in addition to a routine home inspection,” said Billy Jensen, Fidelity National Home Warranty. “If an older system is still in good condition, and could be operational for another 5-10 years, it may not be a problem.  But if the system is more than 15 years old, and could potentially need expensive repairs or component replacement in the future, it’s probably best to negotiate with the seller.”

As always, the NHSCA suggests homebuyers work with a licensed and seasoned real estate professional to assist them in navigating this issue, as well as ensuring their own understanding of the refrigerant issue and its potential impact on them if a service problem arises, including the specific coverage afforded by their home service contract.

The National Home Service Contract Association (NHSCA) is a non-profit 501(c) (6) industry trade organization of member companies serving home service contract providers and consumer interests throughout the United States. For more great industry, media and consumer information, visit  http://www.homeservicecontract.org or call 913-871-5600.


Interview with NHSCA Executive Director & Counsel, Art Chartrand

HomeWarrantyWiz.com published this interview in 2011 on consumer resources to home warranty consumers


Click to read the original and full  Home Warranty Wiz – NHSCA interview article. The following is an excerpt.

Home warranty is a service that is known by many different names. As an industry the generally preferred terminology for services that assist home owners with the costs and hassles of certain household repair and replacement needs is “home service contract”. But depending on the part of the U.S. a home owner resides in, there may be other commonly used names such as residential service contract and of course, home warranty. The National Home Service Contract Association is made up of some of the U.S. companies that are leaders in delivering home service contracts to home owners. This is distinct from the industry that works with home builders on new home construction warranty programs that cover builder issues and home structure.

The industry that offers home service contracts to owners of existing homes includes many well-known companies such as First American Home Buyers Protection, American Home Shield, and Old Republic Home Protection. This is the industry which the NHSCA and Art Chartrand work to represent and promote best practices within. I spoke with Art about a number of key areas that the NHSCA is lending its energy to in the United States. What I learned is that home warranty customers have a lot to look forward to as the NHSCA improves its ability to communicate with consumers. The home service contract industry also seems likely to benefit from the work that the NHSCA is involved in and ultimately it may see fewer fly-by-night home warranty companies as a result of the access that the organization is giving consumers to information about reputable home warranty companies.

My first questions for Art were about the mission of the NHSCA, something that is described in good detail on their website, www.homeservicecontract.org. First and foremost I was interested in the work that the NHSCA is involved with in the U.S. Capital and state capitals. Legislative relations are important to all industries but Art keyed me in one some reasons why it’s especially important to industries around the consumer space generally referred to as “warranties”. Based on what Art shared with me it seems that federal and state legislators often confuse or associate unduly the home service contract industry or its products with other products such as retail, new product extended service agreements and for automobiles service plans. For this reason the NHSCA spends a lot of time talking with states’ law makers about the home service contract industry to foster a better understanding of the services its member companies provide to home owners. Laws that are intended to protect consumers can sometimes cast too wide a net and wind up snaring services or affecting industries that by definition should not be included. In this respect NHSCA efforts to engage legislators at both the national and state level are a benefit to consumers and the home service contract industry alike.

Interacting with legislators is one part of the work that the NHSCA is committed to but there are also efforts to assist consumers in a more direct way that interested me greatly. I asked Art to tell me about some of the things that the NHSCA is doing to help home service contract customers as well as those who may be considering purchasing this type of service agreement.

As a trade organization the NHSCA does not become involved in resolving disputes between consumers and its member companies. But the NHSCA does seek to be the trade group for the home service contract industry and thus strives to be helpful to consumers as well as the companies providing home service contracts. Consumers who contact the NHSCA for advice can expect to receive the best information available since the NHSCA itself is made up of some of the most prominent companies providing home service contracts in the United States. Member companies are held to high standards and though the NHSCA is not a regulatory body it does communicate with its member companies regarding industry trends, consumer concerns, concerns from lawmakers, and many other relevant topics that consumers may sometimes be interested in knowing more about. The NHSCA website is an excellent place for interested home owners to visit but according to Art, one of the best ways for home owners to get trustworthy feedback about a particular home service contract company is through a local real estate agent. Art spoke highly about the role that real estate professionals play in referring their clients to companies that they believe are trustworthy. Art had this to say about the licensed professionals who assist home sellers, buyers, and owners with such referrals.

“Agents know a great deal personally about how the home service contract companies they’ve referred their clients, have dealt with service calls. This knowledge is invaluable to home owners trying to decide whether or not to do business with a particular home service contract company.”

Art also told me that based on recent years’ statistics somewhere around 2/3 of the home service contracts sold in the U.S. are chosen during a real estate transaction. This would mean that a great number of consumers who choose a home warranty or are provided with one by a seller have the opportunity to consult a real estate professional prior to making the final purchase decision. It makes a lot of sense to put that to a real estate professional since they may have a great deal of first or second hand experience with how different home warranty companies handle service calls from their customers. The point of service is when a home warranty customer really learns how well a home warranty company handles repairs or replacements of covered items in the home. Though the NHSCA does not intervene directly in matters involving its members and customers who have complaints, the organization does seek to provide consumers with ways to report dissatisfaction with particular home warranty companies. In the coming months new features will be made available on the consumer-facing NHSCA website including a complaint and feedback area where visitors to the website can report problems and share their personal experiences. That information, Art told me, does not just hit a dead end but rather is shared with the companies that are named in the complaints. Though the home warranty industry has many reputable companies Art did point out that the less reputable ones will be discovered faster when consumers have the ability to share their stories with the NHSCA and have that information be reviewed alongside similar reports from other consumers. Policing the industry is not the job of the NHSCA but in Art’s explanations of the way the organization wants to engage and assist consumers I saw the potential for some cleaning up in the home warranty industry, specifically where fly-by-night companies are concerned. I asked Art what the NHSCA typically does with regard to reporting suspicious activities to state authorities and this is what he told me.

“We actively work with members, consumers and state regulators. We have contacts in every state with regulators and are constantly trying to educate them and their enforcement bureaus on any suspicious activity. Fortunately, we have had very little, but we need to be vigilant. We are a very regulated industry, so we also contact new companies directly and offer to guide them to proper regulatory compliance.”

Art added, “Real Estate agents are our best friends. They understand a solid home service contract industry is a win, win, win for everyone.”

The NHSCA is not a regulatory entity, nor is it a consumer advocacy group per-se, but the work that it does has the potential to make a positive impact in both of those arenas.

I asked Art to sum up what the NHSCA seeks to be for those it works for and his answer was a simple one, “Serving consumers and providers, one call at a time.”


The National Home Service Contract Association (NHSCA) is a non-profit 501(c) (6) industry trade organization of member companies serving home service contract providers and consumer interests throughout the United States. For more great industry, media and consumer information, visit  http://www.homeservicecontract.org or call 913-871-5600.