FALSE! FRAUDULENT?

Michael Sean Quinn*

American Home Shield advertises a home warranty by beginning with a satirical skit where a person goes to a claims adjuster seeking coverage for his malfunctioning air conditional and is told that there no coverage for his air conditioner. Of course, this is false. There is some coverage for air conditioners, just as their is for his house and virtually all of its legal tangible contents, except, for example, for those which are illegal, e.g., a box of marijuana (though the box itself may be covered if it sustains physical damage), or not covered for some other reason, e.g., being very rare art works that may need to be specially scheduled.  

The adjuster is then portrayed as saying that the house is covered for earthquake, volcanoes, and zombie apocalypse.  Of course, the insured is horrified, while the adjuster is pridefully amused.  Here is a second, though less serious error. It is not the case that a zombie apocalypse is not covered unless it does physical damages to the house (and therefore its air conditioner).   This would be true even if the residence in the dwelling were killed or injured. (It might even be true if the apocalypse were only a partial one, i.e., if the world as we know it were not totally destroyed. It might depend on whether the courts would count a zombie attack as an act of war.)

A third error, in some ways the most serious, is that the voice states that the warranty covers what will happen, as opposed to what might happen. Of course, it is false that every air conditioner will suffer malfunction (or physical injury) because of product defect, mistreatment by the residents, or wear and tear. 

Therefore, AHS is not selling a financial-service product for what is certain to happen to each of us.  Moreover, although I haven’t actually seen the warranty, my bet is that it contains exclusions or exclusionary language

Someone could easily believe that there is some sort of racket going on here, and I am not talking about the lunatics of the world that see vile conspiracies almost everywhere. I doubt that this is true in this case and certainly would not say so out loud unless I am  nothing more than formulating a hypothesis. It is reasonably arguable, of course, that ones needs both insurance and a warrant.


However, one should expect disagreement, argument, adverse reasoning, and even  conflict with the warranty company about how much it will pay (assuming it does not deny the claim) in case of needed repair and/or replacement, just as the homeowner may have it with an insurance adjuster.  


(Warranty adjusters, even if only supervising designated repair diagnosticians from  distance, are not infrequently, ex-property insurance adjusters, which is not necessarily a bad thing.) 


Read the warranty in advance. Get a copy and read it several times.  If there is enough money at stake, call a coverage lawyer and pay for an hour or so of his/her time.


*Michael Sean Quinn, Ph.D., J.D.

1300 West Lynn Suite 208

Austin, TX 78703

Office Phone: 512-296-2594
Cell:512-656-0503
Fax: 512-344-9466

Email: mquinn@msqlaw.com 
www.michaelseanquinn.com 

Originally posted on 11/03/2016 @ 5:36 pm

Michael Sean Quinn, PhD, JD, CPCU, Etc

Michael Sean Quinn, PhD, JD, CPCU, Etc. (530)

One of Texas's leading insurance scholars, Michael Sean Quinn is a past chair of the Insurance Section of the State Bar of Texas and has a broad legal practice.

Hits: 2