AAA Water Sewer Line Protection Plan

[Lifeblood]

AAA Washington offers a 'Water Sewer Line Protection Plan" for $7.99 per month (see attachment - 2 pages). Our home was built in 1976, and there are no known issues with the water and sewer.  I am inclined to ignore the offer, hope for the best, and be rest assured that our emergency fund could cover any necessary repairs.

Is buying such a plan ever justified?
Is the expense data listed in their flyer accurate or exaggerated?
How long do sewer and water lines generally last?

[Argyle]

No, it's never justified.  If you're worried about your water and sewer lines, self-insure by putting $7.99 in the bank every month.  By the time your lines need fixing -- if indeed that ever happens, which it may well not -- you'll have plenty.  Bonus: you'll also have money in case the roof leaks, there are plumbing problems, electrical problems, the water heater needs to be replaced, or what have you...  Or you could just keep an emergency fund.  In short, this deal is a rip-off.  It might help one in a hundred thousand people who happens to need the service when they have the insurance.  But the odds against needing it are huge.

I did have to have my sewer line replaced a few years ago.  (Installed in 1924, a tree had grown into it.)  I used my emergency fund.  Problem solved.  That's one sewer line problem in 35 years, or $3355 worth of insurance payments, had I bought insurance, not counting interest on the money.  The repairs cost under $600.

[MandyM]

I agree with Argyle - not justified. One point I would like to add is that most repairs are probably point repairs, not the whole line.

As for the service life of water and sewer pipe, obviously that depends on a lot of factors (material, installation method, usage, etc). Without knowing anything, I would assume 50 years. I just bought a house that was built in 1964. The water lines are galvanized metal, which way less than ideal (build up inside the pipe slowly reduces how much water can get through and eventually blocks the pipe). Eventually, I will need to re-plumb the whole house but even with this bad material, it has still lasted 50 years.

FWIW, I'm an engineer in the business of designing new water and sewer systems and rehabbing old ones.

[Lifeblood]

Excellent advice and information. Thank you! It's as if these companies would install a line to suck the money right out of your house.

[Greg]

I have AAA road service for my car but would never buy insurance from them.  Sewer pipe insurance sounds like a real money-making scam for them.

[seattlecyclone]

Yeah, that coverage seems like a ripoff.

My house in Seattle is 100 years old. Last year we had an issue with the sewer backing up. I had a plumber over with a scope to check it out, and it turned out one of the joints between two underground iron pipes had shifted enough to create a choke point in the plumbing system. Some toilet paper or something got caught in there and was preventing other stuff from going down the drain. He removed the blockage (something that I'm pretty confident I could do myself now that I know where the problem is likely to be), and the sewer has stayed unblocked since.

This type of thing is relatively common in older houses. The plumber quoted me about $1500 to dig up the old pipe and replace it. I opted to take my chances and see how long we could go without the pipe shifting more, but we could end up needing to spend that money at any time. We have savings for exactly this reason; the cost of a repair is not nearly large enough to justify buying insurance.

And if your house is only 40 years old, you have even less reason to worry.

[tooqk4u22]

My house in Seattle is 100 years old. Last year we had an issue with the sewer backing up. I had a plumber over with a scope to check it out, and it turned out one of the joints between two underground iron pipes had shifted enough to create a choke point in the plumbing system. Some toilet paper or something got caught in there and was preventing other stuff from going down the drain. He removed the blockage (something that I'm pretty confident I could do myself now that I know where the problem is likely to be), and the sewer has stayed unblocked since.

This type of thing is relatively common in older houses. The plumber quoted me about $1500 to dig up the old pipe and replace it. I opted to take my chances and see how long we could go without the pipe shifting more, but we could end up needing to spend that money at any time. We have savings for exactly this reason; the cost of a repair is not nearly large enough to justify buying insurance.

For you I think the insurance would be worth the money - at $8/month if you paid it for 15 years you would be even.  You have a high likelyhood of needing it sooner. 

[ljp555]

I have a 100 year old house and have been considering this insurance as well (though not with AAA). It covers up to $3K/incident up to 4x/year. On one hand, if I have 1 major repair in my lifetime and the insurance covers it, I will come out ahead. On the other hand, my internet research into the insurance company found a lot of warnings that the policies had so many exclusions, you couldn't be sure that you would be covered when something broke. I've decided against the coverage for now, though I'm not confident it's the optimal decision.

[Thegoblinchief]

Personally, I would self-insure with an emergency fund.

It is worth, however, finding out what the sewer lateral is made of. Some materials have only a 50 year service span.