A direct mail campaign offering warranty coverage for damaged water, sewer and septic lines has homeowners wondering about the authenticity of the offer and if they have sufficient coverage to pay for repairs if they occur.
Homeowners own the water service and sewer/septic lines on their property, and should the lines become damaged by roots, rot, clogs, leaks or freezing temperatures, the homeowner is responsible for any repair or replacement. While some homeowners may have coverage for such damage through their own insurance policy, others may not, and likely won’t be aware of the lack of coverage until the damage has occurred.
Adam Weishar, director of public works, says the Municipal water and wastewater system currently supplies approximately 8,200 residential service connections combined, and that “the pipes from the property line into the home are the property owner’s responsibility; the Municipality only repairs within the road allowance. If a third party is installing servicing and damages existing water and sewer services, in my experience, they have repaired or covered the costs of repair as a result of their negligence.”
In late 2019, Service Line Warranties of Canada (SLWC) approached the Municipality with the intent of forming an agreement that, with the Municipality’s endorsement, would permit SLWC to offer its warranty service to residents. The service is not available to individual homeowners and must be endorsed by the Municipality in which it is offered. It is not an insurance policy, but instead a warranty service. Warranties are available for three products; the external sewer line, external water line and septic/well systems. Coverage cap levels are $5,000 for water lines, $8,000 for sewer lines and $3,000 for interior plumbing coverage. SLWC says 99 per cent of claims fall below the cap levels. Warranty premiums are paid by the month, quarter or annually.
The proposal was presented to Council on Jan. 13, 2020 and was given the go-ahead to move forward. Its implementation was delayed by the onset of the pandemic, and direct mail pieces didn’t start going out until late summer and early fall of 2020.
SLWC pays for all costs associated with promoting the program, including the direct mail campaign. While there is no charge to the Municipality, it will receive an annual royalty fee of five per cent of the revenue collected. The royalty will be placed back into municipal funds that are utilized to offer services.
The Municipality has been clear that no personal data or information was shared with SLWC, as per the agreement.
SLWC recruits local contractors to provide service should a repair be needed, and ask that clients provide feedback after a repair is completed, to ensure they are happy with their service and the work was performed properly.
Kincardine is not the first municipality to make an agreement with SLWC. Similar agreements have been made with almost 60 other towns, townships and cities in Ontario, including Goderich, Hanover and Saugeen Shores.
“There has been a fair amount of concern over this program,” said Weishar. “We (the Municipality) are impartial, we simply wanted to educate the public and provide them another option to ensure they have coverages should they wish to obtain. If people wish to be removed from the mailing list that is possible by contacting the company or reaching out to us for assistance. Our role, in reality, was to offer comfort that the program is legitimate and not a scam.”
SLWC is endorsed as a vendor of choice by the Local Authority Service, which was established in 1992 by the Association of Municipalities of Ontario. The Local Authority Service works with Ontario’s municipalities to provide a list of preferred vendors who leverage economies-of-scale and cooperative procurement efforts.
Homeowners should check with their own insurance providers to assess their coverage, before signing up for any service.