James Hunter

Home Emergency Insurance Solutions "Recommended by SJWC?"

I received a formal looking letter from the San Jose Water Company signed by Robert Day, Director of Customer Service. It may look official, but it really isn't. The fine light gray print at the bottom of the letter says, "Coverage provided by Home Emergency Insurance Solutions is an  optional, third-party, non-tariffed service. San Jose Water Company customers are not required to sign up for this service in order to receive regulated water utility services from San Jose Water Company.".




Who is Home Emergency Insurance Solutions? Do they satisfactorily serve their customers? What record does HEIS have? What does SJWC get for recommending and probably provided a customer/ratepayer mailing/address information to HEIS?  Did SJWC give my mailing information to HEIS, since the letter used the SJWC logo, was signed by an SJWC employee, and SJWC is probably getting compensated by HEIS and the envelope shows it was mailed in Hartford, CT (an office of Homeserve USA parent corporation).........did SJWC violate my privacy by giving HEIS a mailing list of ratepayers? especially my address?

Let's start with "What does SJWC get out of this", it's likely that they get 10% at least of the revenue from their customers/ratepayers. That's 225,000 customers times $4.95/month or about annually $59.40, if 100% signup, $13,365,000. SJWC gets 10% or $1,336,500 every year and more as the customer base grows. Where does this money go? How much does HEIS make on this insurance?

The Alameda County Water District has also "offered or recommended" their ratepayers HEIS insurance. ACWD published description of the insurance says ACWD gets 10%, per year, of the revenues. It also notes that they have 1% of their customers annually get a leak let's do some math:

82,533 (October, 2012) ACWD customers
$4.95 per month

This is then $4,902,460 HEIS (if 100% signup)

ACWD also says 1% or so of their customers have a leak, some leaks are not covered by the HEIS Insurance. So lets assume that 500 customers/ratepayers have a leak in the water line from the water meter to your home. It doesn't include anything past the point the main water pipe enters your home.

I've seen quotes in San Jose from $1200 for plastic pipe to $2000 for cooper pipe replacing the water pipe from the meter to a home. Let's take the high number $2000. better yet the highest amount HEIS covers in an incident $3000.

500 leaks times $3000 equals $1,500,000

$4,902,460 (premiums) minus cost of incidents (insured covered leaks), (10% ACWD $490,246 plus estimated cost of repairs $1,500,000)

Home Emergency Insurance Solutions makes $4,902,460 minus $1,990,246:


$2,912,214 annual HEIS profit from 
ACWD customers/ratepayers

WOW! The question is is this the HEIS Insurance a fair price for what you may get?
Did SJWC or ACWD do any do diligence whether it made sense for their customers/ratepayers?

What is the experience of other water utilities with HEIS and other organizations?
The above raises some issues about doing business with Home Emergency Insurance Solutions. It also calls into question the $4.95 rate while appearing low may be extremely high for the protection you get, as the model for ACWD showed. SJWC again did not try to be transparent and give their customers any guidance or any disclosure of the terms and benefits for either their customers or SJWC.

After reading that and concerned about my privacy, I looked up SJWC Privacy statements regarding a customers personal information:
The only thing I've signed is a check to pay my SJWC water bill. SJWC says they'll request my "WRITTEN CONSENT", before releasing my personal information.

Apparently the potential to get $1,336,500 or more every year will buy Homeserve USA (AKA Home Emergency Insurance Solutions) a release of my personal information without my written consent, from the San Jose Water Company.

I wonder if California CIVIL CODE SECTION 1798.80-1798.84 applies to the potential disclosure of my full name including middle initial and home address, in a computer format, as well as other customers/ratepayers of San Jose Water Company, as part of their "partner" relationship with Homeserve USA (aka Home Emergency Insurance Solutions).  Wikipedia has a page explaining the California Privacy law and the recourse of customers, with the potential disclosure by San Jose Water Company, to Home Emergency Insurance Solutions.

Home Emergency Insurance Solutions FAQ does say how mailing addresses are obtained:


Q. How are the mailings done? How is mailing information obtained?

While as part of this agreement the mailings arrive in San Jose Water Company-branded envelopes, Home Emergency Insurance Solutions executes the mailings. All of the mailing information used by Home Emergency Insurance Solutions to contact homeowners is obtained from publicly available data sources. 

It's worth reading the page of FAQs, as the perspective of the message appears to represent San Jose Water Company as selecting Home Emergency Insurance Solutions, as a "superior solution", but doesn't really recommend the insurance and doesn't say anything about what San Jose Water Company gets in return for use of their logo and their  "sort of" implied recommendation. It's important, the Director of Customer Service signed the cover letter, but simply says, "passing along the information".

I'd really like more transparency from San Jose Water Company what are they getting as a partner of Home Emergency Insurance Solutions. Should an activity like this be part of the things a regulated utility does, does it really benefit the customer/ratepayers or does it benefit someone else?

Latest posting, 6/25/2015, to the blog on Homeserve USA can be viewed, click here.

34 comments:

  1. We got this notice too.. very offical looking!..But having learned to read the fine print. saw isn't connected to the Water Company at all ! Buyers beware!

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  2. Thank you, James Hunter, for such a thorough and well researched commentary on this very unacceptable behavior by our water company. I was shocked to receive the same solicitation in my mailbox today. I previously received a post card with the SJWC logo which solicited voluntary/optional sign up with HEIS. I researched HEIS on the web and found that they were essentially a scam operation preying on unwitting water company customers but NOT really providing any service (look it up yourself). I wrote a letter to SJWC and the Calif. Public Utilities Commission complaining that this was not a good business practice for our water company. I received a copy of a reply from SJWC to the PUC (Re: IC274347) from Drucilla Redwine (Customer Service Superintendent) which "respectfully disagrees with Mr. Richard's (sic) opinion."
    Her response emphasized the OPTIONAL nature of the offer and that "the postcard referenced served as an introduction to the program and was not intended to provide comprehensive information about the product or SJWC's association..... SJWC is not collection this premium for HEIS. All agreements and payment arrangements are between HEIS and the customer, and not with SJWC." And further, that "Any customer can request to be removed the mailing list by contacting HEIS..." My suggestion that SJWC distance itself from HEIS and withdraw permission for HEIC to use the SJWC imprimatur immediately was completely ignored. I let the issue rest until today when I have received a more extensive solicitation for the same service. I am outraged that SJWC would continue to associate with these crooks.... and, yes, permitting HEIS to use the cover of SJWC is an association. Perhaps it's time to write to the PUC again and request a reply.

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  3. Rufus, I appreciate your concern and your making your opinion known, on this Blog. SJWC is very likely to be getting payments from HEIS for their "support". Other local water agencies/companies are getting a 10% portion of all payment and in at least one case a $25,000 staff support fee was paid. Thanks

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  4. I also decided to have a tankless water heater because I have a big household. All of us can take bath using hot water without it running out. I agree there is a short delay from cold-hot water, but it is okay to with me to wait for just a couple of seconds. You’ll get used to it.

    water softener
    water filter

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  5. I'm glad I checked further on the letter I got from "Home Emergency Insurance
    Solutions". I live in Virginia and this insurance is being offered by a company in Norwalk, Ct.. It leads you to believe a local contractor will perform all services.
    It looks bogus and whether it's a scam or not it is set up to suck people in with typical matter of fact but fear based-you-need-this-insurance-to-avoid-costly-repairs scare tactics. lt tries to look official but you can barely read the logo and the letter is pieced together with a separate mailing label and type designed to try to look like a warrant/official government notice. Thanks for posting this information. I will put it in the shredder where I put it the last time, and try to get off their mailing list. Does anyone know who is behind this? It reminds me of the collection agency tactics that were exposed by 60 minutes years ago.

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  6. In response to the question about who HEIS (Home Emergency Insurance Solutions).

    Home Emergency Insurance Solutions (HEIS), a wholly-owned subsidiary of HomeServe USA (HomeServe), http://www.homeserveusa.com/. From what I can find, HEIS is basically a reseller of home emergency insurance, covering all kinds of failures.

    http://www.yourserviceplans.com/sanjoseplans An example is the SJWC plans
    http://www.yourserviceplans.com Connects to the HomeServe website

    Anyone interested can Google search, "HomeServe USA complaints".

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  7. Thanks James for researching all of this. I will throw these irritating mailings away (again).

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  8. Thanks James.

    I got the same letter with Alameda Water County District marketing us to MUST Buy :)

    Thanks for your blog ..

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  9. I did get this coverage, and even with the exclusions of riots, military unrest, nuclear, flooding, lightning, landslides, etc; it does state clearly under 'coverage' on my policy that "This Policy also covers damage to the water service line caused by freezing and root damage." The pre-existing damage states "a relocated water service line or unauthorized (unlicenced) alterations or a third party doing excavation on your property or in the vicinity of the water services line. $60 a year is a tank of gas and piece of mind to me.

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    Replies
    1. The policy is underwritten by Wesco Insurance Company, received by HEIS via their cool but sneaky SJW logo with the SJWC endorsement. All in all I believe that $60 a year is worth it, as any other insurance policy you have, auto or home, you hope not to use it......but if needed wow your glad you had it. Think about your auto insurance (that you haven't used ever for a collision)- but you have it!!!

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    2. Thanks for your posting, all opinions are welcome. But keep in mind about 20% of SJWC ratepayers are at or below the "poverty" level, the $5/month could be more significant to them. There are three other blog postings on the topic of Homeserv USA and SJWC, I suggest you read them and also post your opinions. Thanks

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    3. Understood. I did look up a couple of other sites and posted there as well. Thanks for blogging out there, as people need to have a sounding board or a starting point for such issues.

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  10. McD, if your interested there are three posts at http://sjwc-rate-increase.blogspot.com/ on different topics about Homeserv USA and SJWC.

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  11. I pretty sure its very good have to share with us and would like to appreciating on this great post. blocked drain colchester

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  12. We recently received a very official looking offer from these folks for our San Rafael house that was built around 1950. $5.49 per month. I'm thinking of contacting the Marin County District Attorney Office's consumer protection.

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    Replies
    1. Thanks for your comment. They seemed to have taken me off their mailing list! (;->)

      They are likely not in violation of any obvious law, just taking advantage of consumers/ratepayers.

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  13. It might be time to update your blog... I just looked up HEIS on the web site of the CT. BBB and its rating (as of 2014) is A+. I've gotten several of these letters over the last couple of years and thrown them all away. It's clear to me that it's not from the water district, but I can see how some people might be deceived. Plus, all the alarmist text makes it sound fishy. Then my next door neighbor had a leak. He had previously gotten the insurance. His $2800 repair was completely covered. They even upgraded his pipe from galvanized to copper at no cost. I think it's important to separate the criticism about the deceptive advertising from the criticism about the coverage itself. While I agree that the advertising should be more transparent, the coverage is pretty well defined, albeit admittedly of narrow scope. Based on my neighbor's experience I plan to get the coverage, as our houses are 50+ years old, and like a prior poster said - $59 a year is cheap peace of mind.

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    1. I'm very pleased to hear they are improving not only their BBB rating, but providing excellent service to your neighbor. Several years ago that didn't seem to be true. I hope my blog helped motivate some of the improvement. I will check their BBB rating and see what comments are being posted in the press and update the blog, as appropriate.

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    2. Just to follow up with you on your comment you posted. As you suggested I took a look at the Homeserv accreditation and A+ rating. I was surprised with what I found, you may wish to take a look at my response, as I found some discouraging information.

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  14. Thank you for this very informative blog post James!! It helped me get to the bottom of these scare tactic 'offers'. This sort of thing should be illegal.

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  15. Thank you for your very informative post James! It helped me get to the bottom of these scare tactic 'offers' I've been getting in the mail. What a slimy thing for HEIS to be doing.

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  16. Replies
    1. Yes, it is legal. The rule is really basic are they providing a product or service, the value to the buyer is determined by the buyer. Caveat Emptor, A Latin phrase for "let the buyer beware." The term is primarily used in real property transactions. Essentially it proclaims that the buyer must perform their due diligence when purchasing an item or service. The economics "appear" to be biased to provide an excellent profit to the seller (Home Emergency Insurance Services) and the associated referer San Jose Water Company (other water companies in the bay area get at least 10% of the premiums). SJWC can under the current rules provide non-tariffed products and services, without the same level of scrutiny CPUC applies to effectively monopoly water business.

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  17. Thanks for taking the time to discuss this, I feel strongly about it and love learning more on this topic. water damage restoration tampa

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  18. Dilbert, I sympathize with your concerns and I would be happy to assist you in reporting your situation to San Jose Water Company. What general area of the city did this occur? Did you see a truck outside your property that had the SJWC or SCVWD painted on it? What was the date and time this occurred? Can you provide a more detailed description of the individual beyond, "Tall lanky dude, perhaps 6' 3”" this would help hair and eye color skin color/race, clothing that was worn? Most of the field maintenance wear shirts with logos? Can you provide digital pictures of your meter and the work that caused some of the problems you've encountered (when the water around the meter goes down)?

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    Replies
    1. I try to validate and confirm all comments, I believe in fair, unbiased reporting/blogging. If the comment is incomplete and a serious complaint or warning to others, I request additional information.

      Trust but validate. Is the rule I apply to things I publish and try to see that comments meet the minimum standards.
      My personal opinions are solely mine and I make every effort to base my blog on verifiable information and provide links to the original data or make note of "bloggers opinion".

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  19. I've re-read your comments and I'm concerned, I've requested you provide added info, in the event you can not provide anything further, to be fair to all the parties I plan to delete your comments tomorrow. Your are posting under the name "Dilbert" rather than posting your comments under your real name or using a valid email address. I can always be contacted at my email j88hunter882@gmail.com, if you would like to contact me directly and based on our conversation I will be happy to re-consider my decision to remove your comments. I will also provide you some background on Michael Krausnick and his comments.

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  20. Dilbert I certainly wish anyone was paying me to whitewash them.....

    Your response confirms my concerns your looking for something other than truth and reality. If you want to post/comment under your real name and have a valid email address rather than attempting to be anonymous and posting unsupported complaints, I'd be happy to work with you.

    I have 5 or 6 postings concerning HEIS and their insurance. If you've taken some time you may have noticed I have presented the info and it has been pretty critical, as well as the use of labor hours by water companies to support non-tariffed businesses, which are very hard to separate man-hours ratepayers.

    If there is no available supporting information you can provide and you wish to remain anonymous, I will remove your comments from the blog.

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  21. The following was sent to my email address by Dilbert:

    Dilbert has left a new comment on your post "Home Emergency Insurance Solutions "Recommended by...":

    So you are part of "Home Emergency Insurance
    Solutions" whitewashing campaign. Providing disinformation to keep people from learning the truth. I hope they are paying you well.

    Carry on, James.

    Immediately preceding this post, I responded to Dilbert's accusations that, I was whitewashing HEIS and the water companies supporting their sales efforts.

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  22. This will be the last post from "Dilbert". His postings concerning HEIS and SJWC were moved to SPAM, as the blogger and editor I'm committed to posting verified information and providing links, to source information, for my readers to make their own conclusions. He refused to disclose who he really is and remains anonymous. Further he failed to respond to my requests for supporting information. This casts doubt about his postings, since Dilbert's specific claims and comments were not verifiable.

    ================================================

    Dilbert has left a new comment on your post "Home Emergency Insurance Solutions "Recommended by...":

    > Your response confirms my concerns your looking for something other than truth and reality.

    You graduated from whitewashing to gaslighting pretty quickly there, James. Let's stop the back'n forth in the hope your ISP never finds out that you're violating Terms Of Usage by advertising (for organized crime, no less).

    --Dilbert

    ====================================================

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  23. Cost/benefit risk analysis. 1%/year probability of $2,000 failure = $20/year. $4.95 x 12 = $59.40/year.

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  24. If I can get either third party confirmation of the analysis or your identity (valid email alias) within a week I'll remove your posting. The probability of a failure is implied as 100 years, is this a fair and reasonable assumption? In reality the cost varies from about $1,000 to $2,000 depending on the pipe and length of the trench required. I agree the price while appearing trivial may not offers reasonable value to the buyers, my opinion as I've indicated in previous posts and the value to the buyer also questioned by the more traditional press.

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  25. nice blog i i like it thank you

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  26. Thank you for sharing such great information. It has help me in finding out more detail about home insurance!

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