What Is A Service Line Protection Plan?

Man digging water line for service line protection plan coverage.

If you are a homeowner, you may have received an advertisement for a service line protection plan. However, you may not understand the purpose of such a protection plan.

Many homeowners do not realize they are responsible for the lines or pipes that run through their property until an issue arises. As the property owner, you are responsible for any connecting lines from your home to the street. 

Let’s say your incoming water line springs a leak. It may be a slow leak that takes a long time to realize, or it can be more evident by discovering a prominent wet spot in your yard. Either way, you are responsible for repairing, not the water company.

An estimate for replacing a water line in your yard runs from $2,000 – $10,000 per HomeAdvisor. The total cost will depend on the distance from the street to the house, whether you need to dig a trench or whether using a trenchless process is possible. For example, the cost per linear foot to replace a water line ranges from $50 to $250. You will be hit with a hefty bill if your home sits far back off the street.

Homeowner’s insurance companies do not include service line protection as standard coverage.

However, your provider may be able to add a rider to your homeowner’s policy that will consist of service line protection coverage. You need to review your coverage with your insurance agent to be confident you have this coverage.

Many utility companies offer coverage as well. These are not insurance policies but function more like a home warranty. You can read this previous blog post for more information on how a home warranty plan works.

Read the fine print whether you go with a homeowner’s policy rider or a utility company coverage. For example, you may not have coverage for all the utility lines that enter your home. 

Policies can include:

  • Sewage
  • Water
  • Gas
  • Electricity
  • Internet
  • Telephone
  • Fiber Optics
  • Steam

These service lines can become damaged by many different means. For example, damage to underground lines can occur due to shifting ground caused by earthquakes or nearby construction, tree roots, or corrosion. 

Some common causes of damage come from:

  • Rodents
  • Freezing
  • Construction
  • Rust
  • Landscaping accidents
  • Digging into the property
  • Wear and tear
  • Electrical or mechanical breakdowns

Service line protection plans each have their distinct coverage policies. Be sure to read and compare programs before deciding which one to purchase.

Some items that may be covered include:

  • Repair of line
  • Line excavation
  • Loss of use if you must vacate
  • Outdoor property repairs
  • Replacement Costs

Again, it is imperative to read the service line protection plan you are considering to understand the coverage available to you. Do not assume all plans are alike.

Some common items not covered under a service line protection plan include:

  • Water well damage
  • Septic systems
  • HVAC systems
  • Fuel tanks
  • Sump pumps
  • Lines that run under but are not connected to the home.

A rider is necessary if you purchase through an insurance company and will increase your homeowner’s insurance bill. In addition, it would be added to your utility bill if you purchase through a utility company. The monthly charge varies.

New York City offers a service line protection plan covering water and sewer lines through American Water Resources (AWR).

Coverage is available to most residential and mixed-use properties with a 2-inch or smaller service line. The cost of coverage is added to your water and sewer bill and costs $66.84/year for water and $114.60/year for sewer.

The program offers unlimited protection for covered repairs with no service or deductible fees. You would simply contact AWR directly to schedule necessary repairs. Service requests will be answered promptly, and the timing depends on the type of repair.

Do you need a service line protection plan? Certainly, purchasing a service line protection plan is an individual choice. Some advice will tell you that a newer home might not need it. I have heard of a newer home having some issues. The age of the house may not be an issue, but it’s more likely that the older home is more likely to be something that can happen. Ask your neighbors if they have had previous problems. 

If you maintain a substantial emergency repair fund, you may choose not to purchase coverage. However, you may benefit from such a plan if you cannot save for a large emergency repair fund. Keep in mind that some policies have a waiting period of at least 30 days before coverage begins.

I have personally seen the value of having a service line protection plan and saved over $6,000 on a costly repair. Unfortunately, we will see more water line issues in our area as winter approaches due to the freezing temperatures. If you are considering adding a service line protection plan, now may be the best time to finalize your decision.

Contact me, Charles D’Alessandro, your Brooklyn Real Estate Agent with Fillmore Real Estate, if you are considering buying or selling a home. As a Brooklyn real estate agent with over 30 years of experience, I understand the real estate process and can help you reach your homeownership goals. Reach me by phone at (718) 253-9500 ext. 1901 or by email at [email protected].

Charles D'Allesandro

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