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American Home Shield

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Bad faith insurance lawsuits have been filed against American Home Shield and its subsidiary companies, alleging the companies improperly denied customer claims. Some American Home Shield lawsuits have been settled, including one that alleged the company paid illegal kickbacks to realtors. American Home Shield policyholders who feel their claims were improperly denied may be eligible to be part of an American Home Shield settlement or to file a lawsuit against the company.

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American Home Shield

In June 2011, a lawsuit was filed against American Home Shield by customers who alleged contractors were paid a bonus for improperly denying claims. The lawsuit, which seeks class action status, was filed by Bridgette and William Gaudet, and alleges American Home Shield denied claims regarding appliances on the grounds of "lack of maintenance," or "pre-existing condition" despite not carrying out an inspection of the appliances when the policy was issued.

American Home Shield Settlement

In 2010, American Home Shield settled a class action lawsuit filed on behalf of US citizens who purchased or were issued a Home Service Contract by American Home Shield or its affiliates between July 24, 2001 and October 19, 2009. According to the "Notice of Class Action and Settlement," (in the lawsuit Faught v. American Home Shield Corporation), the lawsuit alleged American Home Shield "engaged in a pattern and practice of failing to fulfill its contractual obligations to its customers." This allegedly included failing to provide repair and replacement services even when customers were entitled to those services, and improperly denying claims during the first year of home service contracts.

American Home Shield denied any liability or wrongdoing in the lawsuit. As part of the settlement, American Home Shield agreed to set up a review desk to consider submissions from class members who had their claim denied during the class period.

Bad Faith Insurance

Bad faith insurance occurs when an insurance company improperly denies policyholder claims or delays processing those claims. Some bad faith insurance practices include failing to pay out a claim in a timely manner, requiring policyholders to fill out paperwork repeatedly, failing to conduct a proper investigation into a claim or using unreasonable excuses for not paying out a claim.

American Home Shield Kickback Lawsuit Settlement

In the summer of 2011, American Home Shield Corporation reportedly settled a class-action lawsuit that alleged the company paid fees to realty brokers and agents for promotion of the company's home warranty policies. According to reports, the lawsuit included people who purchased warranty coverage from American Home Shield Corp between May 2008 and March 2011, potentially as many as 500,000 consumers.

The lawsuit alleged that American Home Shield paid kickbacks to realty brokerage agencies and agents in violation of the Real Estate Settlement Procedures Act, which prohibits any payment for referrals of settlement services. American Home Shield denied any wrongdoing. According to some reports, home warranty policies typically cost between $400 and $500 dollars. Realty brokers and agents generally receive fees of between $60 and $90.

Similar lawsuits against other home warranty companies are reportedly pending. Home warranty companies and realty associations say the warranties are not settlement services and are therefore not in violation of the Real Estate Settlement Procedures Act.

American Home Shield Home Warranty Legal Help

If you or a loved one has suffered damages in this case, please click the link below and your complaint will be sent to a lawyer who may evaluate your claim at no cost or obligation.

Last updated on Jan-11-12

LEGAL ARTICLES AND INTERVIEWS

New Home Warranty Lawsuits and Horror Stories
New Home Warranty Lawsuits and Horror Stories Fort Lauderdale, FL: Home insurance to protect one's investment from fire, flood and other forms of catastrophe is a given regardless if a home is new, or used. However, new homes usually feature an enhanced level of protection for the consumer, separate from their home insurance policy--a home warranty that the home is built properly according to updated codes. Some contractors self-insure, while others rely on third-party providers. Sadly, having a home warranty—regardless of the provider or the builder—does not always carry the peace of mind one would ordinarily hope for or expect [READ MORE]

American Home Shield Lawsuit Alleges Improper Denials
American Home Shield Lawsuit Alleges Improper Denials Montgomery, AL: Customers of home warranty companies, such as American Home Shield can take heart that some previous home warranty lawsuits have resulted in settlements. One American Home Shield lawsuit resulted in a settlement, although the company did not admit any wrongdoing or liability in the settlement [READ MORE]


READER COMMENTS

Posted by
Anonymous
on
AHS send a tech out in 2014 to replace the compressor in A/C., we paid for the coolant. Now in 2015, our A/C went out again come to find out AHS and the first tech ordered and installed the wrong compressor. Now its scheduled for repair, AHS has denied covering the coolant cost even though it is their negligence that the A/C is broken. We are out of the $450 we put into the first coolant, while the first technician and AHS steady taking our money for service fees and monthly payments. We sent a complaints after complaints to corporate, waiting for a supervisor to call us back that was 5 days ago after the reps constantly tells us they will call you they are investigating the problem. They did have time though to call the company that is replacing the compressor, to tell them they will not cover the coolant though, really after your negligence. You ordering the part, you sending the tech out to fix it. I really need info on a lawyer

Posted by
marlys duray
on
I fought with them and the appliance company for my dryer for over a month. Finally when one of the reps kicked the complaint up to corporate did I get results. Now I am going through the same thing with my washer. It needs a new transmission and pump. They are passing the buck back and forth and in the meantime I am waiting for a complete breakdown and expect one of these days for standing water where I will have to wring my clothes out by hand. Nobody offered to kick this matter up to corporate this time. I am filing a complaint with the bbb tomorrow morning on both of them and will suggest to the realtor that she may want to quit suggesting to her buyers that they carry a warranty through AHS.

Posted by
Anonymous
on
We have been using AHS for over 16 years including numerous repairs to our 2 air conditioner units. They have arranged for repairs and we continued to paying the annual fee. On or about the 11th or 12th of March we put in a request for air conditioner repair. On March 18th Crystal Air Inc. came out and inspected the unit. They told us that the compressor was bad. They also said that some building codes had changed and they did not think AHS would pay for the code change which required a larger cement base for air conditioners. They expected AHS to replace the compressor but we would probably have to pay for the cement base. They said they would send the claim in and if AHS did not cover the code change we would have to pay for the new base. AHS told us they were reviewing the claim the 2 times we called for an update. Today 4/3/15 we received a letter dated March 3oth that denied our claim. The letter said that since we did not have a filter that should have been on our unit; the missing filter caused the liquid refrigeration to get into the the unit and burned out the compressor. We had never been told that our units needed a filter the numerous times AHS had sent companies out to repair our air conditioning units over the past 16 years. It appears as though they are refusing to replace the unit per their warranty which stated that if they could not repair an item, they would replace it.

Posted by
Georgia
on
Have been without heat for a month. Have sent three techs but still not fixed. Two small kids at home and is 25 degrees outside. When we call to check the status, we wait for 20 minutes each time on the phone.

Posted by
Maryland
on
I've been requesting services on my heat pump since 2004 nearly every year to-date. AHS has provided only enough assistance to keep the unit working. Now that the heat pump needs to be replaced, they are accusing me of failing to provide maintenance and has denied my request for a replacement pump. The unit is literally falling apart because they only would send techs out who agreed to do the bare minimum to keep it running and no more.

Posted by
Maryland
on
I have had ongoing issues with my heating and air-conditioning unit. American Home Shield has always provided the maintenance crew, who would only due minimal work to keep the unit "working." Now that the unit needs to be replaced, American Home Shield says the breakdown is due to my failure to maintain the unit, even though we have a long history of repair requests going back 10 years.

Posted by
California
on
Warranty claim for a pool heater was denied. FAHW said that it is the rodent damage so it is not covered. We asked FAHW several times to send us the evidence that shows the damage is indeed caused by the rodent, but the company refused.

Posted by
California
on
My 16-year-old A/C compressor died. AHS sent out a repairman who falsely wrote in his report that the unit was “poorly maintained,” despite the fact that we just had a maintenance company come out less than three months ago. AHS denied our claim based on his report. We are currently waiting on the second opinion.

Posted by
Georgia
on
I filed a claim with AHS concerning a faulty pool light, filter pump and pool heater. The contractor inaccurately denied my claim. The only company they had to do a 2nd opinion was a company that previously denied a claim that was subsequently overturned by a 2nd opinion.

I paid for an independent contractor to look at the equipment and they agreed that the AHS contractor was mistaken. I feel that this is one big scam and I have emails to prove it.

Posted by
Texas
on
HAD PROBLEMS WITH CLAIMS BEFORE, AND CURRENTLY HAVING TROUBLE GETTING SOME COVERED REPAIRS DONE.

Posted by
Texas
on
Refused to pay for Freon to repair my AC. Also, I have an outside electrical outlet that does not work. They sent two different electricians to repair; neither did. Their contractors are substandard. I still do not have the outlet working after paying for the $75.00 fee.

Posted by
Florida
on
My air conditioner literally exploded. The whole neighborhood heard it/saw it. I had two seperate contractors come out and both said it needed to be replaced. My wife has lupus and I had no choice but to get it done as it was hot outside. I called American Home Shield and was denied the ability to even file a claim.

Posted by
California
on
I had an AC compressor that put out 50 degree air. AHS replaced it with one that puts out 60 degree air. We live in the desert, & the new compressor takes twice as long to reach temperature. AHS says they replaced the old compressor (5 ton) with a 5 ton & that is as far as they will go.

Posted by
Florida
on
AHS denied my A/C claim due to lack of maintenance when they have never inspected my A/C prior. My home is 17 years old and they conclude that lack of maintenance is why my compressor failed. We in fact have had our unit maintained.

Posted by
Texas
on
$6,399 in out of pocket expenses.

Posted by
North Carolina
on
Coverage indicated in contact was not provided.

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