Home is just over 10 years old and has 2 AC units. 2 neighbors have just had their units go out so I'm thinking of extending my home warranty for a year in anticipation of mine doing the same. Is this smart or dumb?

Depends on who you ask. Seems like some people have terrible experiences with the warranty companies and others have decent ones. I decided not to extend my warranty but I don't think it's dumb to keep it. If you have the money and want to hedge bets that way, go for it. Personally I would rather pick the company I use for something that big rather than just using the warranty approved vendors as they don't seem to be the best most of the time.

I won't get into the "are they worth it or not" but would advise you to check into what they will cover.

The seller included one for the house I just purchased. The AC is covered for a max of 1500. For a couple hundred more the coverage increases.

I used to like the AC guy AHS sent out but he is no longer contracted with them. The folks that Old Republic sent out on the rental seemed okay. The system is old but it still puts out cold air. The blower motor and run capacitor both went out and they didn't try to hit me up for a new system.

YMMV

Warranty companies generally use low end contractors who are barely making it in business and then want systems replaced with crappy equipment.

If you want a bad HVAC system, the best thing to do is to use a crappy contractor installing crappy equipment.

I'm in the same position. My AC is 20 years old and won't die. I'm probably giving up at the end of the month and cancelling the warranty.

The HW companies only repair broken parts. People very rarely get full replacements for their equipment. The HW contractors replace coils,compressors etc and leave the rest of the aging equipment alone if at all possible to get it up and running regardless of the efficiency and operating costs.

Overall bad idea in my opinion, and I used to have it the first 3 years of owning my home until everything I called in was in the "not covered category". (Pool equipment, etc etc.)

not worth it, unless maybe you're concerned about not having the cash on hand to pay for a repair.

i cashed out of my HW claim and used it towards a new system i had installed myself. at least they would do that for me, there was no way i was using the guys the HW sent to me.

Keep in mind that the warranty companies don't consider AC an emergency and therefore getting service on a weekend can be tough.

My condenser fan motor took a dump late sat night. I figured out what it was Sunday morning but the places in town that I could have found the motor were closed and Monday was a holiday. The tech just left and has to come back tomorrow because he didn't have the correct motor on his truck.

While the HW service call fee is cheaper than I probably would have spent buying the motor myself and definitely cheaper than paying full price for another company to come out I'll end up spending 3 nights at a friends house.

It's nice to have if you need a full replacement but it typically sucks when you need service in 100 degree weather.

Speed
Quality
Price

Pick two. Or in the case of a HW you picked price and don't get a second choice.

I am in a similar situation in a 12yo house with original (just go one new condenser) AC equip. Since we plan to move in 2 years of less, I chose to get a HW as a hedge. From a financial standpoint after my recently replaced condenser unit, I am about 2k ahead. Even with the $500 of completely BS up charges from the contractor.

But I am frustrated by the quality, complete lack of CS, not following the terms of their own contract, slowness of response, etc, etc. But I bite my tongue and move on.

There is a lot wrong with that industry and it seems to be getting worse. But it does make sense in some situations - like mine or moving into a "new" old house on a tight budget (the wisdom of which is another discussion.)

Just be prepared and understand what you are getting. Read the fine print and get one with the least exclusions. Lately I have been hearing good things about old republic home protection, but have no real evidence.

If you plan to stay in the house and can manage, you would be better off to budget hard and find a good contractor. If a major component fails replace the whole system and reap the efficiency improvement benefit and the higher quality work.

I use Old Republic for my rent house (nothing on personal residence). In the last month, I've had to call them to replace a water heater, replace the AC motor and most recently, snake the main line that had roots clogging it causing a back flow into the master bath/bedroom.

My total for all of that crap with deductibles was less than $300. If I'm paying out of pocket, it would've been well over $1,000 plus more of my time spent chasing down contractors. So far, I've had no complaints (except about my rent house having so many issues).

The warranty is only as good as the contractor that comes out. It took 2 weeks and 3 different companies to get our AC fixed in July.

I used a HW on our AC, and it was great. The contractor came out the day after I called. Showed up on time. Was very professional. Fixed what was wrong, and 6 months later the system is still working fine.

I'm sure there are plenty of horror stories, but mine worked well.

AS someone said, it is all about the contractor. In my experience there are two types.

1) good companies/guys looking to expand or to grow their client base or just supplement. They will still provide the quality they would otherwise. This is the one to hope for.

2) the bottom feeders. These guys know they will get free leads, that they have limit quality control/guaranty worries (the company that did my condenser warranties it for a whole 30 days,) and that they will be able to pad the bill on the bigger replacement jobs with some of the HWC. I think many of these guys never leave the teet of the HWC. It becomes their business model.

I also think that for the typical small repair the experience is better than for the big replacement type things and AC in general in Texas in the summer when they know they have you spread eagle over a barrel.

I just bought a nice home built in 1998. Mostly original AC components. The upstairs quit cooling the second day we owned it...total bummer.
I went through the home warranty company to fix it. They contracted a seemingly good company to come repair it, but it did take a few days to get parts ordered and get approval for repairs (not cool when it's 100 outside), but we had the time and a downstairs AC that was cranking.
They will not replace a unit or system and are very particular about what they will cover (e.g. Rebuilt fan motors instead of new ones, regular thermostats instead of digital/programmable ones).
If you can afford the warenty month to month, but don't have the cash to replace major components when they fail, keep the warranty and think of it like insurance. Still realize that if you have a total failure, where you must do a system change, they will cap your costs, as someone mentioned.
Me, I let the warranty expire after a year and just pay cash to fix stuff.