Daly City is about to become one of the first cities in California to offer homeowners a warranty to protect against costly sewer repairs.
Homeowners in the city are required to maintain sewer and water lines from the point of connection at the public sewer line all the way to their residences.
Under the Service Line Warranty Program, owners of single-family and multifamily dwellings will have the option to pay $9.25 per month to receive coverage of $4,000 for underground pipe repairs, plus $4,000 for street repairs, on a per-incident basis.
City Manager Pat Martel said the need for the warranty program came to light when resident Cathy Pantazy approached the city on behalf of the Daly City Council of Homeowners and Residents Associations. Pantazy, president of the Saint Francis Heights Neighborhood Association, said Daly City sees about three incidents per month that would be covered by the new warranty.
Vice Mayor David Canepa said most homeowners are surprised to learn they are responsible for the underground pipe back to the street connection, and even more surprised to learn their homeowners insurance doesn't cover sewer repairs.
Pantazy said many of the city's homeowners are retired and living on fixed incomes. She pointed to one example of an elderly couple living on Callan Boulevard who had been financially devastated by the cost of unexpected sewer repairs.
Martel said the homeowners associations originally asked the city to create an insurance program to cover unexpected residential sewer repairs. She said this would have been problematic because it would have put the city in the position of being an insurance provider. She said that as a nonprofit entity, the city would have been forced to arbitrarily impose a fee on every homeowner.
Martel said the warranty program the city chose to adopt is a much better option.
The warranty provider is a Pennsylvania company called Utility Service Partners. Participation is voluntary. According to a staff report, Utility Service Partners has an A+ rating from the Better Business Bureau and a customer satisfaction rating of 96 percent. Staff said 99 percent of claims the company handles fall within the coverage amount.
Pantazy said the warranty is normally offered at a cost of $9.50 per month, with cities pocketing a 25-cent commission. She praised Daly City for waiving its commission and passing the savings along to homeowners.
Canepa said he was glad Daly City was among the first in the state to offer the program, and he said he'd like to see other cities in San Mateo County follow suit.
"It's very forward-thinking," he said.
San Diego and Palo Alto have also entered into agreements to offer the Service Line Warranty Program.