Consumer Publications List

Don't Be Alarmed by Home Security Systems Sales Tactics

A Maryland woman received a phone call telling her that she had won a free home- security system. After the system was installed, she was told she would need to sign a three-year contract for monitoring and pay a monthly monitoring fee to the company that installed the alarm. She refused to pay and was told the equipment would have to be removed. Angry, she refused to let the installer take the system out, and refused to pay the monthly fee. Now she has an alarm system that does not work.

Another Maryland woman decided to purchase a home security system. After comparing prices, she chose the company that had the lowest price. When the installer arrived, he told her the price she had been given was for a wired system, not the wireless system she wanted. She ended up paying more for the wireless system. A few days later, she saw an advertisement from the same company for the wireless system she had purchased at the price she had originally been quoted. The company denied her request for a partial refund.

More and more people are turning to home security systems to protect their houses from break- ins. The Consumer Protection Division has received many complaints from consumers who were misled when they purchased home security systems or monitoring contracts, who didn't understand the terms of their contracts, or who were unhappy with the system they purchased.

Selling Home Security

The home security business is highly competitive and companies use a wide variety of gimmicks to get consumers to sign a contract. Here are some you may encounter:

• Giveaways, discounts and sales: Some security system companies offer a free system, free installation, or free monitoring for a given period. Sometimes, this comes in the form of a "prize." Other companies use coupons, flyers or telemarketing to announce discounts on some part of the home security system. These offers could include free installation if you buy a certain system, a free month of monitoring if you sign a long-term contract, or some other "money off" offer.

• Fear tactics: You may be approached by a knock on your door from someone who was installing a system for one of your neighbors. Sales representatives often quote crime statistics for your neighborhood and encourage you to purchase a system by telling you that houses without systems are more likely to be burglarized, or suggesting that by not having a security system you are putting your family at risk.

• Bait and Switch: Some companies advertise a low price or give you a low quote by phone, but when a sales representative or installer comes to your home, they will try to sell you a bigger system. For example, the price quoted might include three sensors, but when someone visits your house, they may say you really need six.

Choosing a System

As with any purchase, you should evaluate your needs and compare prices before you make a decision. When deciding on a home security system, don't be persuaded by fear tactics or promises of deals and savings. Don't allow yourself to be pressured into making a quick purchase to take advantage of a "one time only" price cut, or something you have "won." Although brochures and sales representatives might try to persuade you that your home is not safe without a security system, you need to decide for yourself. When deciding, consider cost and convenience. You have to arm and disarm the system each time you leave or enter the house, or open a window, and you may have false alarms that annoy neighbors. Some people find the system is more trouble than they had anticipated.

If you do feel you need a security system, compare systems and complete costs. Complete costs will include hardware and monitoring, if necessary. Because the home security industry is so competitive, you may be able to negotiate prices, but make sure you are comparing the same items in each estimate. Some companies give you a price by phone that includes a few sensors and a motion detector, but later tell you that you need more sensors to protect your whole house. To avoid this problem, don't rely on phone estimates.

Call three or four companies and ask to have a representative come to your home and give you a written estimate. Make sure the estimate includes a list of all sensors, detectors, control panels and other pieces of equipment you will need. When you compare prices, be sure you are comparing the same things. Find out whether you will own or rent the system, how many and what type of detectors and sensors are included, whether the price includes monitoring and what the monitoring includes. Also get a written estimate on the cost of monitoring and the required contract length, if there is one. And be sure the estimate includes a written statement about whether you will own or rent the security system. Also, find out if the system can be monitored by companies other than the one you are buying it from.

You may be able to negotiate such things as installation cost, monthly monitoring fee, contract length and equipment cost, but be sure to get all estimates and promises in writing.

Finally, when you decide on a company, read the contract carefully before you sign to be sure you understand all of the terms. Once you've signed the contract, you are generally obligated to its terms.

March/April 1998

Maryland Attorney General's Consumer Protection Division Consumer hotline: (410) 528-8662 or 1 (888) 743-0023 toll-free