Arizona Attorney General Kris Mayes announced she has resolved a consumer fraud lawsuit against Choice Home Warranty, a New Jersey service contract company that operates in Arizona and nationwide.
The judgment entered on January 23 requires Choice Home Warranty to reform its sales practices and provide meaningful disclosure to consumers before selling warranties. The company also agreed to pay $11.8 million.
ABC15 was the first to report on the Arizona Attorney General's Office filing a consumer fraud lawsuit against Choice Home Warranty in 2019, after receiving numerous consumer complaints.
Customers alleged the company failed to replace air conditioning units and other home appliances it advertised as being covered.
Since 2013, more than 1,500 Arizona customers have submitted complaints against Choice Home Warranty to the Arizona Attorney General, the Arizona Department of Insurance and Financial Institutions, and the Better Business Bureau. The Let ABC15 Know team has also heard from viewers having issues with the company.
Customers frequently reported that Choice Home Warranty's telephone sales representatives failed to disclose various exclusions and limitations that undermined the warranty product's value.
Representatives also allegedly misrepresented what repairs or replacements their warranties would cover.
Choice Home Warranty and its executives were previously investigated by the New Jersey Attorney General for their business practices, resulting in a $780,000 settlement in 2015. However, their conduct appeared to continue even after that settlement.
Choice Home Warranty denies the allegations made by the state and has not admitted any wrongdoing as part of the settlement agreement.
The company sent ABC15 this statement in response to the settlement: “We are pleased to have reached a resolution with the Arizona Attorney General’s Office regarding these claims, which were first raised more than seven years ago. Importantly, the resolution includes no finding of wrongdoing, no admission of liability, and no civil penalties.
While we strongly believe our practices have always been fair and compliant, we agreed to reimburse the State of Arizona for certain legal costs in order to put this long-running matter fully behind us and avoid further expense and distraction.
For more than a decade, Choice Home Warranty has focused on delivering reliable service and peace of mind to homeowners nationwide. We appreciate the opportunity to close this chapter and remain committed to serving our customers with integrity, clarity, and accountability.”
Choice Home Warranty customers who purchased a warranty over the phone between January 1, 2013, and January 1, 2023, to cover a home located in Arizona may be eligible to receive restitution. Consumers do not need to file a complaint with the Attorney General's Office.
The Arizona Attorney General's Office will release additional information at a later date regarding eligibility, including where and how to apply. Restitution will be distributed once adequate funds are received from the settlement.
The Let ABC15 Know team will continue to stay on top of this story, and we will be sure to update viewers when the details on filing for restitution are available.
Do you need help with a consumer problem? Let ABC15 Know! Email Consumer@abc15.com.
This story was reported on-air by a journalist and has been converted to this platform with the assistance of AI. Our editorial team verifies all reporting on all platforms for fairness and accuracy.
