Flyers sent to PG&E customers caused confusion

Sonoma County resident Bill Skoonberg recently received a flyer in the mail that set off alarm bells.

If you’re a PG&E customer, chances are you’ve received one too.

It says homeowners are often unaware that they are responsible for the outdoor plumbing and electrical systems on their properties, and that HomeServe, a national home repair provider, offers protection plans that can be billed through PG&E.

Skoonberg didn’t understand the connection to PG&E and wondered if his information had been hacked.

“There are a lot of warning signs here for me,” said Skoonberg, who worked at PG&E for years.

He added that the mailer was “out of character for the company I worked for.”

He also questioned the need for such insurance, but “the partnership with PG&E will make people say, ‘Gee, maybe I should take care of it,'” he said.

He’s not alone. Posts on Nextdoor have generated dozens of confused and skeptical responses.

The mailing is not the result of a data breach, but the launch of a partnership between PG&E and HomeServe and possibly other third-party companies.

One of the seven pages in the mailer explains that HomeServe is not a subsidiary of PG&E and that the utility “is not responsible for, and does not guarantee, plans offered by HomeServe.”

But the package also includes a letter from a PG&E vice president, Chris Zenner. “We have exciting news to share with you!” he writes. “As a valued PG&E customer, you have access to home protection plans from HomeServe.”

He goes on to say that “HomeServe is a trusted provider of home security programs” and that customers can now enjoy “the convenience” of having the company’s charges added to their PG&E bill.

PG&E spokesperson Lynsey Paulo told the Press Democrat that “we have received some questions from customers and so we are currently considering that feedback.”

First collaboration

It’s the first time PG&E has partnered with a third-party company to offer consolidated billing, and Paulo said the benefit will allow customers to “reduce the number of bills they pay each month.” It’s a service offered by a number of utilities across the country, she said.

It also provides revenue to PG&E in the form of a fee paid by HomeServe for billing and payment processing services. Most of that fee “is used to reduce rates, keeping the prices customers pay lower than they would otherwise be,” according to a PG&E web page, though Paulo declined to elaborate. percentage.

That web page explained PG&E’s third-party billing program and mentioned a formal selection process. It provided contact information for companies interested in collaborating.

Now though the page states only that PG&E is “currently making updates to this web page” and directs inquiries and attempts to cancel plans to a HomeServe website and phone number.

As a third party, HomeServe is not subject to the jurisdiction or regulation of the California Public Utilities Commission like PG&E and other investor-owned utilities. Utilities do have to file annual reports disclosing new types of partnerships, such as PG&E’s billing services.

The CPUC approved short-term funding for PG&E’s programs in 2023 and 2024, but noted that more information was needed for a long-term assessment “due in part to a lack of detail on how profits from these programs are used to reduce PG&E’s rates . ”

An audit will take place soon and profits from the program cannot be spent in the meantime without CPUC approval.

People think it’s ‘tone deaf’

“While this is clearly optional — there’s no doubt about it — I think a lot of people feel like it’s a tone-deaf approach to getting on top of record-breaking bills,” said Mark Toney, executive director of The Utility Reform Network, a nonprofit organization for consumer interests. who said his organization has also received questions about the partnership. “They say they’re working to reduce costs, but this incentivizes an optional service, an insurance product, that some people will benefit from and most won’t, because that’s how insurance is supposed to work.”

In addition, Toney said, the promotional package that includes the letter from PG&E’s vice president “gives the impression that you are official or that you have to do something or something that PG&E recommends.”

A HomeServe spokesperson said more than 5,100 PG&E customers have signed up since its launch last month. Homeowners can sign up directly with HomeServe, but its main business is partnerships with municipalities. The company has 1,300 such relationships in the US, including 48 in California.

Checking the drawing

HomeServe has drawn research and legal problems in the past marketing regarding some of these partnerships, based on the confusion created among consumers and questions about the actual benefit of the offer. In 2023, the company will… agreed to pay $850,000 for alleged violations of the Kansas Consumer Protection Act. Between 2010 and 2015 HomeServe agreements were reached with attorneys general or other state officials in six states during investigations.

HomeServe has not admitted to any wrongdoing as part of these deals, and HomeServe’s spokesperson said the company is in good standing with all regulatory agencies where it operates. He said customers have saved more than $2 billion in repair costs, and when asked what percentage of policyholders were filing claims, he said, “we are in a customer’s home making some type of repair on average every 46 seconds.”

PG&E’s Paulo said HomeServe went through a competitive selection and vetting process and that the company works with many other utilities. She added that “customers’ decision to opt in or decline the offer will not impact PG&E service” and that “PG&E and HomeServe are working together to ensure customers better understand the relationship.”

On the issue of customer privacy and information sharing, Paulo said names and addresses were provided to HomeServe, but no financial or personal information, such as Social Security numbers, was shared. “Protecting customer privacy is a top priority for PG&E,” she said. Consumer attorney Toney agreed that PG&E is responsible for customer data.

Customers who do not wish to receive marketing materials can opt out in their online account preferences.

“In Your Corner” is a column that puts watchdog reporting to work for the community. If you have a concern, tip or suspicion, you can reach “In Your Corner” columnist Marisa Endicott at 707-521-5470 or [email protected]. On X (formerly Twitter) @InYourCornerTPD and Facebook @InYourCornerTPD.