Gas Line Repair Puts Homeowner at Risk of Economic Shock

Gas Line Repair Puts Homeowner at Risk of Economic Shock

Shannon, a Southern California Gas customer, was at risk of economic shock when learned she had a problem with her gas service line. Service was temporarily discontinued to her home after a leak was detected. 

“The gas company could detect that there was extra gas being used,” Shannon said.

An Unexpected Repair is an Unexpected Expense

Without gas service, Shannon was unable to enjoy many of her home’s basic necessities in the interest of health and safety. Returning service would cost thousands of dollars, putting her at risk of economic shock.

Economic Shock

Shannon’s situation isn’t unusual – more than 50 percent of American homeowners needed a home systems repair over a 12-month period, according to the Winter 2019 edition of HomeServe’s Biannual State of the Home survey. These situations can cause economic shock, a large and unexpected expense that negatively impacts a household.

Economic shock is even more common than emergency home repairs, with 60 percent of U.S. households having experienced economic shock, such as emergency home repairs, within a year, according to The Pew Trusts. Unfortunately, more than a third of homeowners have $500 or less set aside for home repairs.

A repair like the one Shannon needed could cost, on average, $20 to $30 per foot, but up to $75 per foot, depending on the work done. Luckily for Shannon, SoCal Gas had partnered with HomeServe, a leading provider of home repair solutions, and Shannon had enrolled in HomeServe’s service line protection program.

HomeServe Offers a Solution

“When we found out there was a problem and the gas was turned off, we called HomeServe,” Shannon said. “They contacted a plumbing company to come out and determine the problem.”

Economic shock

HomeServe dispatched a licensed and insured network plumber, Frassica Inc., to Shannon’s home. The line was old and deteriorated – dating to the late 1960s when the home was constructed – and needed replaced from house to meter.

“[HomeServe] does whatever they can to make sure the customer’s necessities are met,” John, a Frassica technician, said. “HomeServe goes above and beyond to do what needs to be done; the best warranty company that you could work for.”   

The job included extensive concrete work and 250 feet of trenching, which would have cost $10,000 to $15,000, a substantial economic shock.

Save Money and Worry With a Policy

“With HomeServe, they are saving a tremendous amount of money,” Ken McCarthy, Frassica owner, said. “We’ve had to cut multiple sections of concrete and dig trenches. Some people couldn’t afford to pay for this, but that’s the value of HomeServe. For a nominal monthly fee, they’re covered when projects like this come up, and they get good value.

“These types of plumbing failures happen. I own a plumbing company, and I also have a HomeServe policy. Anyone who is a homeowner has experienced plumbing failures or will.”

Shannon knew the job would be large but didn’t realize the extent of the work.

“It was a much bigger job than we anticipated, but there was no out-of-pocket [costs],” she said. “The entire repair is being covered by HomeServe.”

Shannon was happy to have service returned, free of the worry of economic shock.

“I’m very satisfied with HomeServe,” she said. “I would absolutely recommend this type of warranty because you truly don’t know when something is going to go wrong. They came through for us and saved us a lot of money.”

Economic Shock Can Catch Consumers Unaware

Energy consumers want engagement and for utilities to provide solutions. As the industry goes through a rebranding period, many energy providers are looking to utilize their own expertise and resources to expand their offerings in synergistic ways.

Position Yourself as a Trusted Partner

Home energy analysis and energy efficient rebates programs are great ways to position your utility as a trusted partner, but they lack human touch and nothing makes them stand out from what every other energy provider offers. This is why utilities are turning to affinity partnerships to expand their service offerings.

You can differentiate yourself by offering education about electrical safety and energy efficiency – something of which 88 percent of homeowners approve – while simultaneously offering an optional emergency home repair plan to protect them from economic shock, or a large, unexpected expense.

Many Homeowners Are Unprepared

More than one-third of Americans have $500 or less in savings in the case of an economic shock, and that increases to 54 percent of those who have a total annual income of $50,000. A Charles Schwab study showed 60 percent of American live paycheck to paycheck, and The Pew Trust found 60 percent had an economic shock in the previous twelve months.

Economic shock threatens about one-third of Americans.

The Biannual State of the Home Survey, conducted by The Harris Poll, reports the financial impact of home repairs, the state of the American home and researches home ownership trends. In the fall edition, the survey found more than one-third of homeowners would prefer a deductible-free emergency home repair plan like HomeServe’s offerings. The number was double that of those homeowners who would prefer to pay a rider on their home insurance offering a deductible. In addition, 69 percent of homeowners would prefer their local utility to offer an optional emergency home repair plan from a third party.

Homeowners Are Worried About HVAC

In addition, the HomeServe Biannual State of the Home Fall 2019 survey shows 50 percent of homeowners had an economic shock within the past 12 months. HVAC systems accounted for the most needed repairs, about one-in-five, and nearly half of homeowners are worried about the state of their HVAC system. Many homeowners are shocked by the cost of HVAC repairs, despite the size and complexity of most systems and safety requirements.

One-in-four homeowners had an HVAC repair in the past year and nearly 50 percent are concerned about their systems.

In the past year, HomeServe has sought to address our customers’ concerns about HVAC breakdowns by purchase HVAC repair companies in Washington, D.C.; Cleveland, Ohio; and Grand Prairie, Texas. These hubs will enable us to better serve our – and our partners’ – HVAC customers.

Educating Customers is Key

Education about improving energy efficiency and safety is key, but HomeServe also offers education about service connection responsibilities. In a previous State of the Home survey, more than 40 percent of homeowners surveyed didn’t know they were responsible for maintaining their service connections.  A total of 18 percent were unsure who was responsible, while another 11 percent thought their homeowner’s insurance would cover the repair expense and 13 percent believed the utility was responsible.

Customers want utilities to offer optional emergency home repair plans.

If homeowners don’t know who is responsible for service connection maintenance, they will likely contact the utility if there is an issue. Then you will have the unenviable task of letting them know they are on the hook for thousands of dollars in an emergency home repair they may not be able to afford.

To learn how you can educate homeowners about their responsibilities and help them avoid economic shock, contact us.

Gas Service Line Repair is a Financial Shock

“When I came home that evening, I smelled gas very strongly,” Dorothy said.

It’s every homeowner’s nightmare – a gas service line failure. Dorothy, a Houston resident and CenterPoint customer, learned that her gas service line, although only 15 years old, was leaking.  

An Unexpected Problem

Jose Carbajo of Texas Quality Plumbing and his crew were quickly onsite, where they assessed the problem. Jose realized the gas service line was PVC, which was no longer up to code in the area.

“We’ll dig, trench, about 50 feet and install new [gas service] line that’s up to code,” Jose said.

Not only had the gas service line not lasted long, but replacing it would cost $3,000. However, Dorothy couldn’t delay, because she would have no gas service to her home until the gas service line was repaired. Leaving it as it was, was unsafe and untenable.

Financial Shock Can Prove a Hardship

Dorothy had experienced a financial shock, or a large, unexpected expense. The effects of a financial shock, such as an unexpected home repair or a sudden loss of income, can be devastating, and the United Nations estimates 40 million Americans are living in poverty. Estimates range from three-in-four to three-in-five Americans who are living from paycheck to paycheck.

Many homeowners are not prepared for a financial shock. However, 60 percent of American households endured one in a calendar year, according to the Pew Trust. Among those who experienced a financial shock, 55 percent of households struggled to make ends meet afterwards.

The HomeServe State of the Home Fall 2019 survey found more than half of Americans had a home repair in the prior twelve months. Meanwhile, one in five has nothing set aside in a “rainy day fund.”

A Solution Emerges

Luckily for Dorothy, CenterPoint partnered with HomeServe, a leading provider of emergency home repair plans, including gas service lines, electric service lines, water heaters and HVAC systems. When Dorothy received educational materials about the possibility of gas service line failures through the partnership, she signed up for gas service line protection.

“I signed up [for gas service line coverage] in July, I believe, never thinking this would happen, but it did, and I’m very glad that I had it,” she said. “When I called, the agent was very helpful, answered any questions I might have, reassured me that I was covered, which made me very happy. The contractor that HomeServe sent out was very helpful and ready to fix whatever it was.”

Jose and his team installed a new, safe, code compliant gas service line for Dorothy. It didn’t cost her a penny, thanks to CenterPoint and HomeServe.

National Tune Up Day: Get Ready for Winter

With fall comes cooler weather, hot drinks, sweaters and … heating system maintenance? That’s right, it’s time for National Tune Up Day!

The colder it gets, the harder our heating systems work, and the more likely they are to break down if there is an ongoing problem. No one wants their furnace or boiler to break down, and annual maintenance keeps it in good working order. However, because many heating systems are out of sight, some homeowners pay them no mind, until they aren’t working correctly.

Regular maintenance keeps heating systems chugging along, because 29 percent of home energy usage is heating-related, according to ENERGY STAR. For every year of maintenance and cleaning that is skipped, the energy bill increases by 5 to 10 percent, according to House Logic. So, an annual tune up keeps heating systems energy efficient and lasting longer, providing additional years of service.

What Does a Tune Up Include?

A tune up should include inspection of the system and cleaning of filters and coils and service, which can include testing fuel pressure, airflow, thermostat controls and pilot lights. During the inspection, a HVAC technician will examine the heating system for signs of wear-and-tear, such as cracks; look at the motor and compressor; and ensure that all parts are in good shape.

Once the system has been properly cleaned, a technician will replace any worn-out parts, such as fan blades or capacitors and, in some cases, lubricate parts. The technician will look for anything that will potentially cause a system to breakdown or cause extensive damage if left unchecked.

How Much Will It cost?

Most tune ups will cost between $100 and $200, depending on whether services include both the heating and cooling systems, the size of the home and the age of the system. However, once a HVAC system breaks down, it may cost several thousand dollars to repair. Labor costs average from $100 to $150 per hour, and that doesn’t include parts. The average repair cost is from $160 to $400 for furnaces, with the high end at $900.

The HomeServe State of the Home survey reported more than one-third of homeowners have $500 or less set aside for an emergency repair, 13 percent had difficulty finding a reliable HVAC technician when they needed one, and 17 percent required a HVAC system replacement or repair in the past year.

A tune up can prevent these expensive problems – and can be scheduled at a convenient time. When technicians must come out on an emergency after-hours call, the price increases.

Why Should a Licensed Technician Perform a Tune Up?

Homeowners should always hire a licensed HVAC technician with appropriate insurance to perform a tune up. It isn’t just about cost and convenience, it’s also about safety. Clogged flues, chimneys and filters can cause carbon monoxide to back up into the home, causing headaches, dizziness and nausea – even death. Carbon monoxide detectors can prevent carbon monoxide poisoning, and so can regularly cleaning out the heating system.

The technician will also check and tighten any electrical connections to ensure none are faulty and a potential fire hazard, according to the Home Advice Guide. Faulty electrical connections can short out the system and reduce its lifespan. Technicians will examine gas and oil connections, making sure they are in good working order. Dirty or leaking gas or oil connections don’t only hurt energy efficiency, but are a major health hazard, according to Energy Star.

HomeServe established National Tune Up Day, Sept. 25, in 2014 to remind homeowners to keep on top of needed maintenance. Homeowners are encouraged to mark National Tune Up Day on their calendars and schedule a home heating system tune up before it gets cold and they discover there’s a problem.

“With some simple preventive measures, homeowners can avoid potentially costly heating system issues this winter, and this is a timely reminder to schedule a tune up as soon as possible,” John Kitzie, HomeServe CEO, said.

HomeServe offers home heating protection plans, including plans that provide tune ups for homeowners who want protection from emergency heating repairs.  HomeServe also offers service plans for water, sewer, electrical and other home emergencies. All plan holders have access to a repair hotline that is accessible 24 hours a day, 365 days a year. The hotline brings local, licensed and insured technicians right to their home for repairs.

Utilities are looking for opportunities to connect more deeply with customers. HomeServe helps to improve customer engagement for our utility partners through the integration of complementary home repair programs with utility initiatives. This includes as energy efficiency and safety, offering customers greater access and choice. Partnership allows the utility to leverage HomeServe’s marketing and communications expertise to educate their customers through a variety of channels. For more information, contact us.

An Electrical Hazard: How to Avoid One During the Holidays

It’s the holidays, and your rate payers are looking forward to family gatherings, gifts and decorating, but they probably aren’t thinking about the risk of an electrical hazard.

No one wants to think about the potential of electrical hazards causing property damage or tragedy at the holidays, but with increased visitors, cooking large meals and holiday lights, the potential for a fire, electrical or otherwise, is higher than any other time of the year.

Christmas trees are involved with an average of 160 reported home fires annually and holiday décor, excluding trees, causes 780 fires annually, with a total of six deaths, 49 injuries and $22 million in property damage each year from 2013 to 2017, according to the National Fire Protection Association.

Your Christmas tree can be an electrical hazard.

Two out of five Christmas tree fires started in the living room and 44 percent involved electrical hazards. One-fifth of décor fires began in the kitchen, and 16 percent began in the living room, family room or den.

Since your customers want to hear from you across many platforms – and, when they do, their satisfaction with your services increases, you may want to share some safety tips to avoid electrical hazards during the holiday season. It’s right in your wheelhouse, shareable, easily digestible and can cross platforms.

The Tree

If purchasing an artificial tree, buy one that is flame retardant – it won’t stop a fire, but it will resist burning, burn more slowly and extinguish more quickly than one that isn’t flame retardant.

If purchasing a live tree, buy one that isn’t dry – the needles shouldn’t break or pull off easily. Keep it watered daily and at least three feet away from open heat sources such as fires or space heaters. Dry trees are a fire hazard. Check out this video from the US National Institutes of Standards and Technology demonstrating the increase in flammability of a dry tree.

The Lights

Examine lights before you use them. There shouldn’t be frayed or exposed wires, broken bulbs or damaged sockets. If a string of lights is damaged or malfunctioning, it’s become an electrical hazard, so you should discard it.

Look at labels. Lights meant for indoor use should only be used indoors, and likewise with those meant for outdoor use. Lights and replacement bulbs also should be tested and certified by the Underwriters Laboratories (UL) to make sure they meet safety standards.

Your holiday lights can be an electrical hazard. Only use lights rated for outdoors when decorating outside.

Don’t overload electrical outlets. Don’t plug more than one high-wattage item into an outlet at a time and don’t connect more than three strings of lights together.

If you’re using extension cords, don’t plug too many lights into one cord and don’t plug too many cords into one outlet. Check the wattage the cord is intended for and don’t exceed it. Cords shouldn’t be run under carpets or furniture, pinched by windows or doors or run through high traffic areas. Don’t remove the third prong, because this grounds the cord and prevents electrocution.

If using a cord outdoors, don’t leave it on the ground, because water can get into the connection and cause an electrical hazard. Instead, elevate the connection with a brick or rock. Outside, use Ground Fault Circuit Interrupters (GFCI) outlets to prevent water-induced shorts.

Avoid nails, tacks and staples that may pierce wires. Instead, invest in some insulated hooks that will prevent damage to the lights – and electrical hazards.

You should not leaves lights unattended. A timer can be utilized to ensure lights are switched off automatically at times when everyone in the home is out or asleep.

Store safely. When the lights are returned to the attic or the basement at the end of the season, they should be stored in a water- and pest-proof container.

The Meal

This seems like common sense, but remain aware of the stove or oven while in use. With all the visitors and activities, distractions can occur. A timer can be used as a reminder to check food that is cooking.

Be aware of potential fire hazards – clean up grease spills and keep pot holders, towels and oven mitts away from burners.

Keep an eye on wattage. Some kitchen appliances can demand a lot of power – only plug one into any one outlet to prevent it from becoming an electrical hazard. Any outlet that could encounter water or liquids should have a GFCI.

Be prepared in case there is an emergency. Ensure that fire extinguishers and smoke detectors are operating properly.

With just a little thought and preparation, your customers can have a safe and happy holiday season and avoid electrical hazards.

Utilities are looking for opportunities to connect more deeply with customers. HomeServe helps utilities improve customer engagement for our utility partners through the integration of complementary home repair programs with utility initiatives such as energy efficiency and safety, offering customers greater access and choice. Partnership allows the utility to leverage HomeServe’s marketing and communications expertise to educate their customers through a variety of channels. For more information, contact us.

Millennials Buying Housing Face Difficulties Finding Affordable Homes

Christie Myers, Managing Director of Opportunity Dallas, addresses the affordable housing challenges of Millennials.

Felicia’s story isn’t unique, but her determination, despite the hand she’s been dealt, is admirable.

A Constellation of Rising Stars

Seven years ago, Dallas Mayor Mike Rawlings started the Mayor’s Rising Star Council. We selected six sophomores from five Dallas High Schools and promised to be with them for an academic year. After a year, the class graduated, and the Council gave them iPads and said, “good luck.”

The following fall, as a new class of students was being selected, the prior class came knocking. They asked to stay on. The Council agreed and six years later, we have the first class of students graduating from college.

A Challenging Journey

One of those students is Felicia George. Felicia graduated in the top 20 of her Lincoln High School class, going on to study Animal Science at Texas A&M. You may assume she had an easy road and, like many other A&M kids, went with a toolbox that equipped her for what was to come.

Felicia George is one of many Millennials buying housing and facing difficulty finding affordable homes.

However, Felicia’s journey has been a challenge. Her single mother lives in a two-bedroom apartment with her Nanna, uncle and two younger brothers. She didn’t have stability in her upbringing. Chaos and insecurity would be better ways to describe her childhood and young adult years. It didn’t stop her. She would get close to giving up, but she never did.

An Uncertain Future

In May, Felicia will graduate from college. When a student you mentored for seven years looks you in the eyes and asks how she will break the cycle or change the trajectory of her family – what do you say? What can you say?

A Purdue University study showed Dallas residents need a six-figure salary to achieve “happiness” in the city. A diploma doesn’t give Felicia or the thousands of Millennials returning to Dallas for the “American Dream” an equitable chance at affordable housing. Like many others, Felicia will leave school balancing her ambitions with a sense of responsibility to her mother and two brothers.

She can move home, but it’s unsafe. Felicia can’t get to a potential job in a reasonable time via transit. She can’t afford a car, because she spent every dime paying tuition. Felicia won’t pass a credit check, because no one taught her the importance of building credit or how to begin.

Felicia’s story is not unique, although her tenacity and grit separates her. The opportunity to obtain affordable housing would allow her to meaningfully change course for her and her family.

Affordable Housing is Elusive

However, affordable housing remains elusive for many Millennials buying housing, even those who have not come from a lifetime of struggle and poverty. According to a study by Go Banking Rates, monthly rent was by far the biggest expense. It came in at an average of $1059.51 a month for a one-bedroom apartment. The site estimates that the average millennial needs to work 68 hours to pay that off.

Millennials buying housing also may find it more difficult, since they’ll pay 39 percent more than Baby Boomers did when purchasing their first home, while under a staggering student debt load. Despite that, Millennials buying housing accounted for nearly half of all homes purchases in 2018.

However, 63 percent of Millennials regret purchasing a home, according to a Bankrate Poll. Zillow found that more than 80 percent regretted at least one aspect of their home purchase, and 36 percent resent unexpected repairs or home maintenance, such as a malfunctioning furnace. In addition, almost half of Millennials feel their handyman skills aren’t up to snuff, according to The Harris Poll.

Utilities are looking for opportunities to connect more deeply with customers. HomeServe improves customer engagement for utility partners through home repair programs with initiatives such as energy efficiency and safety, offering customers greater access and choice. A partnership allows the utility to leverage HomeServe’s marketing and communications expertise to educate their customers through a variety of channels. For more information, please contact us.