Before you judge a home warranty by its pricing or its paperwork, find out who stands behind it. The company legally responsible for paying claims under a contract is called the obligor. The obligor may be the company that sold you the plan, or it may be a separate company named in the contract. The contract's own definitions section usually says which one applies, and that answer decides where a dispute would go.
Start with the license and the state
A company that sells home warranty contracts in your state is generally expected to be authorized there, and the rules differ from state to state. Check that the company name on the contract matches the name on the state's published roster. The state insurance department or consumer protection office that oversees these contracts is usually the place to start. Our methodology page explains how we use state rosters when we build our own pages, so you can see what we looked at and what we did not.
Ask about complaint records
Most state regulators publish or will share complaint records for the companies they oversee. Ask how many complaints were filed, which categories they fell into, and whether the company responded. A single complaint says little on its own. A pattern of the same complaint, filed again and again, is worth asking the company to explain in writing.
Find the administrator
Some contracts name one company as the obligor and another as the administrator that handles calls, dispatch, and claims. Ask who you will be dealing with day to day, and ask who pays a claim if the administrator fails to. The written contract should answer both questions. If it does not, ask for the answer in writing before you sign.
Questions to put in writing
Ask how long the company has issued contracts, under what name, and whether it has changed names or owners. Ask who the obligor is, where that company is organized, and what happens to your coverage if the obligor changes. Ask whether a separate company holds the money set aside for claims, and how you would learn if that changed.
Keep the answers with your copy of the contract. A company that answers these questions plainly is giving you the information you need to decide, and a company that will not answer them is telling you something as well.