# Heating and Cooling Protection Plans



## trying2Bfrugal (Jan 25, 2014)

My air conditioner and furnace are about 15 years old. Since I moved in to my place a few years back I have been paying per month about $20+tax for heating protection plan, and another approx $20+tax for cooling protection plan. Both with Direct Energy.

So far the only thing I'm getting for my A/C is my annual maintenance. I haven't had any repair done.

For my furnace I also have my annual maintenance. I have also had a few inspection (technician visit due to problems, including minor problems) and repairs, averaging to about 1 repair every 2 years.

Given the age of my appliances and how much I have used the services, is it still worth paying approx $40+tax to Direct Energy? Am I better off getting new A/C and/or new furnace? Or do I just quit these services altogether? Or do I continue with these?

What are your thoughts ?

Thank you.


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## Spudd (Oct 11, 2011)

For AC, I see no point in getting the cooling protection plan. If the AC breaks, you can live without it in most of Canada, at most you'll have a few uncomfortable days in the height of summer. You can live without it until you save up the money to buy a new AC (and now, you can start putting that $20/mo into a "new AC" account someplace like ING or PCF).

A 15-year-old furnace probably has another 10-15 years of life left in it. I see no point in getting a new furnace while it's still working. If you decide to discontinue the protection plan, if/when it breaks you can get an estimate as to how much it will be to repair it and then make the decision whether to repair or replace. Replacing it will be 2-3k (basing that on my furnace shopping from 2006). We got the top of the line 2-stage high efficiency furnace and it was around 3k installed. It's really up to you whether you think you will spend >$20/mo on furnace repairs in the meantime. Does the protection plan cover getting a whole new furnace if it's deemed unrepairable?


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## Beaver101 (Nov 14, 2011)

Somewhat same thought as Spudd but unless the OP is a HVAC specialist (which I doubt) and is able to split the plan payment (i.e. just pay $20/month+tax), I would stick with the furnance maintenance plan.


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## Just a Guy (Mar 27, 2012)

A new furnace is between 3,000-7500 installed. From what I can tell, the main difference between the prices is the profits for the company. Older furnaces lasted forever (30 years was not uncommon), but the newer ones have a lot of plastic parts which tend to have failures just after the warranty expires (say 6 years). These parts are generally easy to replace, but expensive (like the blower fan at around $1000...not enough to justify a new furnace) usually making the furnace company a huge profit once again. The part probably costs less than $100 to make.

Should you pay the insurance? 20/month is $240 per year...if you pay for 6 years, my math says it's cheaper to not pay. If it's an older furnace, they tend to have even more life in them...


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## OhGreatGuru (May 24, 2009)

There seems to be some misconception that Direct Energy's plan will cover replacement of a furnace.
From Direct Energy:
_Parts Not Covered by Your Plan
... For eligible Heating Units, the following parts are not covered by your Heating Protection Plan: *heat exchanger*, heating coil (air handler), heating sections (boiler), firebox/combustion chamber*, furnace filters, low and high water cut-off valves, external metal or plastic venting all associated parts, external drain tubing and all associated parts, external line/low voltage wiring, condensate pumps, back check valves, batteries for programmable thermostats and boiler feed valves, draining of the heating system. *Replacement of the complete Heating Unit is also not covered under your plan.* Zone thermostats/controls and energy management controls are not covered by your Plan._

The main reason for replacing a furnace is when the heat exchanger goes. Guess what, they don't repair or replace heat exchangers, and don't replace the furnace under this plan. There is a long list of things they do cover, but they are elements that are pretty reliable and/or cheap to replace. (Oh, and don't expect a furnace to last 30 years anymore.)

PS: If you have an oil furnace you have to have an annual servicing to meet Ontario regulations, and simply to keep it running. It usually doesn't cost much more to add some protection for parts replacements. But with gas, which will run well for a long time without servicing, its another story.


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## Beaver101 (Nov 14, 2011)

Would it not make sense to just keep the heating "maintenance" plan so that the HVAC tech can do an annual inspection and/or tune-up if required so as to keep the furnace going for a few more years? I'm assuming the $20/month + tax includes the "maintenance" and not just an add-on repair/parts replacement plan.


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## wendi1 (Oct 2, 2013)

$240 plus tax a year will cover your checkup and a quite a few parts. This is a very good deal for Direct Energy, not for you.


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## Just a Guy (Mar 27, 2012)

Sort of like all the fools in eastern canada who "rent" $350-$500 water heaters for $50/month...never made sense to me, which is why I never bought any Consumers Water Heaters stock, even though the talking heads loved it.

Of course, it's a great scam while it lasts, and people are stupid...hmmm, I may have to revisit that stock.


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## marina628 (Dec 14, 2010)

The yearly service call is about $130.00 - $170 ,most new furnaces/HVAC have a 5-10 year warranty that includes parts for $500 -$1000 total .Probably works out better if you just pay out of pocket for the actual expenses but consider when you need a New unit to try to work out a good warranty deal for a flat rate.


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## Beaver101 (Nov 14, 2011)

wendi1 said:


> $240 plus tax a year will cover your checkup and a quite a few parts. This is a very good deal for Direct Energy, not for you.


 .. on checking with a family member who handles this expense, you're right. That's not a good deal to continue with.


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## Beaver101 (Nov 14, 2011)

Just a Guy said:


> Sort of like all the fools in eastern canada who "rent" $350-$500 water heaters for $50/month...never made sense to me, which is why I never bought any Consumers Water Heaters stock, even though the talking heads loved it.
> 
> Of course, it's a great scam while it lasts, and people are stupid...hmmm, I may have to revisit that stock.


 ... and smartaxxex are such pr1cks.


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## Synergy (Mar 18, 2013)

Personally I'd pay pay out of pocket and skip the monthly maintenance plan fee. If you're handy you can learn how to DIY the yearly maintenance. As a DIY'er to be safe you'd want to install a separate CO detector within the furnace room, if the levels build up above threshold limits contact a professional! I'd still recommend a professional inspection every few yrs even for those that decide to DIY. It's nice to be able to do your own, I like to do my gas fireplace inspection and maintenance 2x/year.


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## Ponderling (Mar 1, 2013)

I own my conventional gas fired storage tank water heater. I got rid of the 12 year old rental unit two months after closing. Took it to the depot myself to save the $120 'collection' fee. New one was about $350, and was gas plumbed the same day the furnace went in. I shut it off once a year, and drain it from the drian port to get rid of sediment same day I look after the furnace. Pulled the sacrifical anode once about 3 years ago to inspect it, and there was no sign of any substantial corrosion to it, so I must not have very corrisive water here, coming out of Lake Ontario.

Had a 40 year old low efficiency furnace, one loud fan speed blower. I knew its days were numbered. Economics to go to a higher efficiency furnace with DC fan showed the benifits of replacing it sooner rather than later. 

No maintance contract. Each spring I pull the cold air return filter (usually change it at Christmas as well) , wash out the electrostatic precipitators ( messy job), get the vaccuum with brush end on it into the blower via the precipitator hatch, and vaccuuum it clean. Drain the preciptiator pump, unscrew the top, scrub algae out, and leave a mild chlorine solution in it so it won't grow until a/c season starts and it will be running agian. 

Once so far the ignitor has failed, as they do from time to time. As chance had it I had a spare one around from a gas dryer fix job the month before. So the furnace was a DIY fix between 11pm and 1am one chilly December evening. I now keep an ignitor in stock.

Occasionally in times of low humidity, usually early in the heating season, the water trap can get low on water, and then the inducer pressure differnetial sensors get confused that the wall vent outlet is blocked. Squirt a syringe with 100mL of water into a filling port, reboot the cpu by cycling power, and the issue is solved for another one to two years. 

I know I am an outlier on this sort of stuff, but what I do is an easy counter to shelling out to get someone else to maybe do as rigorous a job.


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## carverman (Nov 8, 2010)

trying2Bfrugal said:


> My air conditioner and furnace are about 15 years old. Since I moved in to my place a few years back I have been paying per month about $20+tax for heating protection plan, and another approx $20+tax for cooling protection plan. Both with Direct Energy.





> So far the only thing I'm getting for my A/C is my annual maintenance. I haven't had any repair done.


What are they doing on the A/C for annual maintenance?

My gas furnace is now 20 years old and still going strong. Up to now, I have not spent any money on a maintenance plan, although they are like insurance (peace of mind).
Last year, my furnace quit in January and I figured out what the problem was, but had no part to fix it (Ignitor) so I called a emergency service to come in and repair it to ($238 with the part and tax).
After the part was replaced (January 2013) I decided to spring for a yearly maintenance plan at the ridiculous price of $262 (with taxes for 12 months). 
It hasn't failed. They came in an vacumned out the furnace, and cleaned the filter for that price, as the furnace has been working fine ,
since that part was replaced and after 20 years, it finally burned out.

I didn't renew the service plan...it's a ripoff. Might as well pay for a serviceman to come and repair it when it actually needs it and I have found one
on Kijji that will do that for far less than the others. 



> For my furnace I also have my annual maintenance. I have also had a few inspection (technician visit due to problems, including minor problems) and repairs, averaging to about 1 repair every 2 years.
> 
> Given the age of my appliances and how much I have used the services, is it still worth paying approx $40+tax to Direct Energy? Am I better off getting new A/C and/or new furnace? Or do I just quit these services altogether? Or do I continue with these?


Why do you need to change the furnace or A/C if they are working well? Getting a new furnace or a/C is NO Guarantee that you will not have problems with these new units that don't last as long and breakdown more often. If it ain't broke..DON'T FIX IT is my philosophy when it comes to furnaces and A/C.


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## carverman (Nov 8, 2010)

Spudd said:


> *A 15-year-old furnace probably has another 10-15 years of life left in it*.
> 
> Yes you should be able to get 25 to 30 years out of the older style 2 stage furnaces, but not sure if those new high tech condensing ones will even last 15 years.
> 
> ...


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## the-royal-mail (Dec 11, 2009)

I agree with wendi1. Companies invent these "protection plans" to protect their financial interests, not yours.


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## carverman (Nov 8, 2010)

Ponderling said:


> I own my conventional gas fired storage tank water heater.


So do I. Bought it at Home Depot and installed it in 2000...GE Smart tank..still going strong after 13 years, even though it only had a 9 year warranty.
Saved at least $360 per year ($30 a month) x 13 yrs =$4680 by NOT renting it! 



> Had a 40 year old low efficiency furnace, one loud fan speed blower. I knew its days were numbered. Economics to go to a higher efficiency furnace with DC fan showed the benifits of replacing it sooner rather than later.


Or you can convert the old fan motor (PSA) to a new tech ECM motor and save on power. They are quiet start up quietly and slow down quietly. I have one in mine and it is great!
These ECM retrofits are suppose to be at least 25% more energy efficient..and on a 1/2 hp fan motor that can be significant savings that will make it pay for itself in a couple of years of use. 

http://www.soperssupply.com/customer/sopsup/pdf/Evergreen_IM_Installation_Guide.pdf




> Once so far the ignitor has failed, as they do from time to time. As chance had it I had a spare one around from a gas dryer fix job the month before. So the furnace was a DIY fix between 11pm and 1am one chilly December evening. I now keep an ignitor in stock.


Mine failed after nearly 20 years. I am going to order a spare one as well. So far in 20 years of service,(excluding the A/C which I had to completely change a couple of years ago, because
all the refrigerant leaked out on the outside condensor) and after 15 years, it was time to change it to a more efficient compressor, I haven't had any problems with my gas furnace. 



> I know I am an outlier on this sort of stuff, but what I do is an easy counter to shelling out to get someone else to maybe do as rigorous a job.


Well it helps to be familiar with certain components on the furnace and be able to read the diagram on how the sensors and parts interact. I can do that
with a small VOM meter myself,and if I don't carry any spare parts, so I have found now, a reliable free lance gas furnace tech that will come over and replace it
a lot cheaper than these ripoff maintenance plans.


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## Beaver101 (Nov 14, 2011)

> ... so I have found now, a reliable free lance gas furnace tech that will come over and replace it a lot cheaper than these ripoff maintenance plans


 ... If I recall correctly (but would need to check with family member who looks after this expense), I think one of the requirements of the "warranty" plan on the furnace is that you would need to have a maintenance plan (and with the company who installed your unit) in order for it to be in effect. Don't recall for this requirement on the A/C though.


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## OurBigFatWallet (Jan 20, 2014)

We just had our one year inspection on our home. When the furnace came up the builder said to not buy any furnace filter over 1000 (apparently stated on the box) as anything higher decreases the air flow. Also he said furnaces are built to last 15 yrs and anything beyond that is dicey. Oh and he also mentioned to not move the thermostat any more than 2 degrees what is comfortable. Reason being it takes way much more power to heat up the house again to reach the comfortable temp if it is turned low regularly. Interesting points that came from an inspector with 20+ years experience in residential homes


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## Spudd (Oct 11, 2011)

I don't believe his thermostat claim. From this site: http://energy.gov/energysaver/articles/thermostats they say:


> A common misconception associated with thermostats is that a furnace works harder than normal to warm the space back to a comfortable temperature after the thermostat has been set back, resulting in little or no savings. In fact, as soon as your house drops below its normal temperature, it will lose energy to the surrounding environment more slowly. The lower the interior temperature, the slower the heat loss. So the longer your house remains at the lower temperature, the more energy you save, because your house has lost less energy than it would have at the higher temperature. The same concept applies to raising your thermostat setting in the summer -- a higher interior temperature will slow the flow of heat into your house, saving energy on air conditioning.


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## carverman (Nov 8, 2010)

Beaver101 said:


> ... If I recall correctly (but would need to check with family member who looks after this expense), I think one of the requirements of the "warranty" plan on the furnace is that you would need to have a maintenance plan (and with the company who installed your unit) in order for it to be in effect. Don't recall for this requirement on the A/C though.


Hmm..if the wazrranty on the new furnace is lets say 5 years x 240 a year...that's $1200 that goes into the service plan provider's pocket in those 5 years. 
Now what can fail in the first year on a brand new installed furnace. practically nothing. So that's $240 wasted. 

Year 2 to 5 ..maybe a sensor or ignitor..that's $240 that the manufacturer will cover anyways..so that's still $1200 in the maintenance plan's pocket..big ripoff!!.
but if it fails at temps at -20C and you have no heat..it's a different story..unless you have a INDEPENDENT furnace tech lined up before hand to call.

I remember seeing last fall that Direct Energy in Toronto convinced a senior lady to throw out a perfectly good furnance,about 3 years ago, and install one of their brands..which failed in the 3rd year and *they came several times and weren't able to make it work reliably..forget the brand..but it took many months.* She called an independent company in to completely replace the furnace AGAIN, and then tried to get Direct Energy to re-mburse her..they refused. So she got the Global TV reporters to get involved before Direct Energy 
agreed to refund PART of the cost of the second replacement furnace.

http://globalnews.ca/video/921584/toronto-senior-buys-second-furnace-after-direct-energy-a-no-show


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## Beaver101 (Nov 14, 2011)

Based on that story, then what's the use of a warranty anyways? Something is amissed here ... I need to further check on this myself. But thanks for the enlightenment.


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## carverman (Nov 8, 2010)

Beaver101 said:


> Based on that story, then what's the use of a warranty anyways? Something is amissed here ... I need to further check on this myself. But thanks for the enlightenment.


The warranty is from the furnace manufacturer and is pro-rated for up to 5 years, I believe . The service plan is administered by a local firm. 
I would NEVER go with Direct Energy. There have been a lot of complaints about them in the past.


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## Beaver101 (Nov 14, 2011)

carverman said:


> The warranty is from the furnace manufacturer and is pro-rated for up to 5 years, I believe . The service plan is administered by a local firm.
> *I would NEVER go with Direct Energy*. There have been a lot of complaints about them in the past.


 .. I agree and I don't use them. *DE* used to be with Consumers' Gas (now called Enbridge) but was spinned off to its own entity. Consumers' Gas (yes, the natural gas provider/distributor) customer service was terrible ... especially with the "equal billings" (scam) adjustments, even their own billing department couldn't tell from heads or tails (long story short). :hopelessness:


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