Know what you are buying when you choose an extended warranty. Here is my recent experience with Bankers Warranty. I am posting the letter I sent to Dealers Assurance who are listed on the terms and conditions of the contract with Bankers Warranty as the 'go to' people at time of dispute with Banker's Warranty. Mr X has been substituted for the real name of the the gentleman who communicated with Bankers Warranty on my behalf. The 2 local repair companies have been changed also to ABC Repair and DEF Electronics. My name shows as (ME). Other than these changes, the following letter is complete and exactly as prepared to Mr. X.
The second letter is from Mr. X containing the miserable response from Bankers Warranty.
One more thing, Circuit City and many other retailers use Bankers Warranty for their extended warranty coverage. ASK who the warranty company is BEFORE you pay for the contract...PLEASE BEAR IN MIND THAT THIS WARRANTY COST ME $499...
HERE IS MY LETTER...
Dear Mr. X,
As per our conversation this morning, please find enclosed the letter I wrote to you yesterday outlining everything relating to this issue:
On October 5th 2007, I searched online to purchase an extended warranty service contract for my Sony TV which was still under manufacturer's warranty at the time till 12/5/2007. The TV was purchased new 12/5/2006 for $2599.99 from Circuit City. I found a website called AVDeals/Plasma.com and purchased a 5 year warranty from them for my specific TV type, size and original purchase price for $499.99. This was less expensive than extending the manufacturers warranty with Circuit City. AVDeals /Plasma .com sent me a receipt of purchase.
A few days later, I received in the mail an envelope addressed from Banker's Warranty. Inside I found a contract headed Netbored.com and an almost identical contract headed VAC Service Corp. I figured that Banker's Warranty was in fact the warranty company and all these other companies were getting a small piece of the pie by brokering for them somehow. Either way it mattered not as I had my contract safe in case of breakdown in the future.
A week later I received an email from AV Deals/Plasma.com confirming shipment and providing a customer service number for claims. I put all these papers together safely and had no reason to use them till 1/3/11.
I recently noticed my TV picture had been deteriorating for some weeks and I felt it reasonable and necessary to make a claim on the warranty which doesn't expire till Dec 2011. On 1/3/11, I called the claims number and the gentleman I spoke with said he was from Banker's Warranty and took my information, put me on hold and returned to tell me to expect a technician from ABC Repairs Inc to come to my home to repair my TV between 8am and 12pm the next thursday - 1/6/11, and that I would be receiving a call from ABC Repairs to confirm. A short time later that same afternoon, I received a call from different company called DEF Electronics telling me they wanted to pick up my TV to take away and repair in their workshop. I explained that 1) I paid for on-site service and 2) I already had an appointment with ABC Repairs on thursday. She seemed quite upset and hung up. Later that same day, I received a call from ABC Repairs Inc. confirming the original appointment on 1/6/11.
For the record, the next day I received a second call from DEF Electronics asking me if I had made up my mind to which I replied again that I already had an appointment with a different company. Again the lady seemed upset and hung up. I thought this was a little strange.
On 1/6/11, as arranged, the technician from ABC Repairs came to my home and diagnosed a faulty panel which he said needed replacing. He told me he would get authorization and come back to make repair when the part was in. He mentioned that these parts are expensive so I might end up with a refurbished part depending on my policy. I mentioned to him the other company calling me and he said it happens a lot where referrals get made and warranty companies give out the information to more than one company so I figured that was what happened.
By the next wednesday, 1/12, nearly a week later, I had not heard anything so I called the same Banker's Warranty number as before and asked for an update on the repair. I was told that they had NEVER called ABC Repair Inc, that no appointment was made with them and that they ONLY use DEF Electronics to service TV's. I obviously questioned this because as far as I know I am NOT crazy and didn't make it all up. In fact the man's voice sounded just like the man I had called the week before - he had a distinctive accent - but he insisted I was being untruthful, that I was NEVER told about an appointment and he told me I had to start the whole claims process over again from scratch and would have to pay ABC repair Inc for the call out of my own money. He also said his notes indicated that someone from Banker's had spoken to me regarding this already and I told that person I CHOSE to use ABC Repairs myself. This NEVER happened and of course would be ridiculous.
After I hung up, I called ABC Repairs and spoke to the same technician who came to my house. He gave me the authorization #, work order # and billing code that he was given by Banker's. I then called Banker's back and gave him these same numbers. His attitude changed somewhat when he found these numbers to be authentic because it proved I could not possibly have made them up and had NOT been lying to him . He said he would refer the case to someone else who would call me.
On 1/13, a lady called me from Banker's Warranty to advise me that someone from ABC Repairs would be out to my home to look at my TV to see what was wrong. I advised her that someone had ALREADY been out the week before and had already diagnosed the problem. I also pointed out that even though the first gentleman at Banker's had insisted that Banker's NEVER use ABC Repair, here they were again making appointments with the same company and I told her how rude the man was to me. She apologized and said she wasn't even told I had already had the technician in my home and to forget she called...strange again.
I then received a call from a gentleman in the claims department at Banker's Warranty 1/20. He explained they had now decided NOT to repair my TV but would mail me a check for $328.64 instead. He also read from what he said was my contract indicating that this was a depreciating policy and read a whole set of terms and conditions that were NEVER disclosed to me. NONE of these conditions were stated on MY copy of the contract and I told him so. He said he would mail me a copy so I could see it for myself. I also inquired as to how this amount of $328.64 was calculated. He could not explain and said the computer works it out.
Today in the mail, I received a check for $328.64 in an envelope with NO details on how it was calculated and NO letter. In a second envelope was a copy of my contract again with no letter and to my surprise it was EXACTLY the same as my contract with no mention of any of the terms and conditions he had read to me regarding why they had refused to repair my TV.
I then spoke to an attorney in Raleigh, NC and faxed him all my paperwork for review advising him of this sequence of events. He agreed that nothing was ever disclosed to me to indicate that the warranty company could cancel the contract at their discretion whilst 'cashing me out' for whatever amount they felt fit. He suggested I contact you and to also contact the A.G's in all the states quoted on all the paperwork I was sent to formally complain regarding these practices.
At $499.99, my warranty was in fact worthless because under these conditions, the warranty company could cancel the contract at any time and cash out whatever amount they felt as soon as an expensive repair occured. I purchased the warranty in the first place to cover any expensive repairs that may develop. After all, isn't that the whole point of purchasing a warranty?
I am sending you copies of all the paperwork I have quoted here and would appreciate you initiating a claim against this company regarding this issue.
HERE IS THE RESPONSE...
I had sent a copy of your correspondence to the Contracts Manager at Bankers Warranty Group (BWG) and did receive a response. Here is his answer regarding the issue about having two repair services respond:
As for the service center issue that (ME) experienced, it appears that the service center that was originally dispatched through ServicePower failed to formally accept the dispatch (though they did so verbally when initially called by BWG’s agent). In order to avoid delays in service, if a dispatch is not claimed within a certain period of time, it automatically rolls over to the next service center on the list, which is what happened here. However, since the original service center had only confirmed their acceptance verbally (rather than formally through Service Power), there was no record of the first s/c being dispatched. BWG apologizes for the confusion and frustration that Ms.(ME) must have experienced because of that.
In regards to the quality of service provided, BWG records their calls and I received the following response:
I have not had an opportunity to have the calls pulled for quality assurance, but I will have our quality team review them and take any appropriate corrective actions necessary with the agents if they are determined to have acted unprofessionally.
In response to the issue of the value of the TV and the amount of coverage toward repair, I received the following:
As far as the ACV issue goes, there isn’t really much to add from my e-mail below. Even if the contract were interpreted as a per-claim LOL (which BWG disagrees with), the result would be the same since the only deduction (other than the cash settlement) is from the diagnostic fee for the same claim. Ms. (ME) television would be uneconomical to repair even if she were to pay for the repairs herself (given that the repair estimate exceeds the cost of new televisions today as TV prices have gone way down over the past couple of years). As such, she would no longer have the same covered television anyway (as the contract is not transferable to a new product). Ultimately, however, BWG maintains that the correct interpretation of the limit of liability is as applied to the contract as a whole.
I believe that I mentioned to you on the phone that I was currently discussing a very similar complaint from another contract holder with BWG and although I don’t personally interpret the contract language the same way they do, I can’t completely disagree with the wording either. I can understand how the limit of liability towards repairs is interpreted but I feel is should be written in a more concise manner. The contract states “The limit of liability for the dealer under this contract shall be the actual cash value of the product in operating condition at the time of the claim.” Because of the statement “under this contract”, they interpret that to mean the total liability for all repairs performed for the life of the contract. Practically all contracts I usually work with refer to the “total”, “maximum”, or “aggregate” liability for all repairs performed under the contract. I believe using these words makes the contract’s definition of the limit of liability under the contract more evident to the contract holders. While technically the contracts are defining the maximum liability for repairs under the contract, you get to the same point in a more concise manner. Because the contract states “There is no limit on the number of repairs that can be performed on the product covered by this contract.”, most consumers are going to see this as the ability to have the product repaired as many times as necessary regardless of the limit of liability but, because a limit of liability which is equal to the actual cash value of the unit does apply, it takes precedence over the number of repairs. Again, although I don’t completely agree with BWG’s interpretation of the contract language, I can’t disagree with their interpretation either.
Because we are simply their insurance company and our responsibility under our contractual agreement with them is to provide funding to pay for valid claims if they become financially unable to do so, we have no authority to override any claims decisions they make and we cannot force them to approve a claim beyond what they feel is appropriate. We do investigate complaints when a contract holder contact us and if it appears a claim has been improperly declined, we point out the Administrator’s error and they usually correct it. In this case, because they have not really made an “error” in their claim decision, there’s nothing we can do to change their decision.
WHAT A BUNCH OF BS...of course I understand that TV's have in fact gone down in price since I purchased mine. I do NOT expect full reimbursement for my TV. I DO however expect Bankers Warranty to pay for the repair OR exchange for similar. That's all...nothing more ...nothing less...
SO LIKE I SAY...BE VERY VERY CAREFUL WHO YOU DECIDE TO USE IF YOU CHOOSE TO PURCHASE AN EXTENDED WARRANTY...ACTUALLY, GO ONE BETTER AND DO NOT WASTE YOUR MONEY ON ONE AT ALL BECAUSE AS YOU CAN SEE THEY ARE NOT WORTH THE PAPER THEY ARE WRITTEN ON...ESPECIALLY THOSE WITH BANKER'S WARRANTY.