What to do if a home warranty company is refusing to pay for repairs to an air conditioner?

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What to do if a home warranty company is refusing to pay for repairs to an air conditioner?

I have a home warranty. I have had this warranty for over 3 years. My air conditioner, after working fine for the years that I have had the policy, went out so I called the warranty company. They sent a technician out to look at the unit. It turns out that before we bought the home (apparently this was missed during our home inspection) someone had repaired the air conditioner unit and put a wrong sized part on it. As it turns out the original part was not available because the unit was old and the part could no longer be bought. So they “made do” and put a part on it that was not made for this unit and “made it work” by holding it up with a 2×4. As I said it worked this way for years without our ever having known it was even there. Now, the air-conditioner is in need of coolant because this part has a leak in it. The warranty company is refusing to cover it siting “improper installation”” as the reason. The warranty contract does say that they only cover normal wear and tear and that it does not cover problems from improper installation. My argument is that it has worked perfectly for years so the problem is not improper installation but normal wear and tear. Also, they covered this unit and took my policy dues for 3 years while “covering it” so they know that it has worked properly. This company demands arbitration to solve a dispute. So, my question is, do we have a case or are we going to be defeated by the technical language of the contract?

Asked on June 13, 2011 under General Practice, Georgia

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

1) First, if there is an arbitration clause, you are most likely going to have to arbitrate; the courts tend to favor arbitration and enforce arbitration clauses.

2) If the part was improperly installed at the time the warranty was purchased AND there was no reasonable way for you to have  known that, you probably have a good argument that the warranty company has to either a) cover the repair or b) refund what you paid for the premium--when you are an innocent party and the air conditioner was effectively non-coverable when the policy was purchased, the company can't keep your payments but not cover. It would seem to need to either agree to cover or else treat the contract as void from the beginning (due to the nonconformity) and return the money.

3) If anything nonconforming was done to the A/C after you bought the policy, then they can probably disclaim coverage.

If it's a large enough expense to warrant it, you may wish a lawyer to represent you. If it's not large enought to justify an attorney, then you have to ask yourself how hard do you want to fight.


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