EPCOR is defending a new marketing agreement for waterline rupture insurance that it entered into with U.S.-based company HomeServe.
Under the agreement, HomeServe mailed letters bearing the EPCOR logo which encourages Edmonton homeowners to read the enclosed material about the company's water break insurance. The envelope also contains a HomeServe insurance application.
Although the envelopes bear the names and addresses of homeowners, EPCOR spokesman Tim Le Riche says the utility did not give HomeServe information about its customers, which is against the law in Alberta.
"EPCOR did not provide any privacy information about any customer," Le Riche said. A HomeServe vice-president says the names and addresses were purchased from a third party company.
HomeServe got into trouble with authorities in Ohio, Kentucky, Georgia and Massachusetts after its marketing campaign appeared to come directly from the local utility and not the company. The company paid fines and promised to change its marketing practices.
Le Riche says his company has done its due diligence and believes that HomeServe's problems are in the past.
"We believe that it has reasonably dealt with its issues in the United States and that we believe that this is a reasonable option for Albertans and people in Edmonton to consider for themselves," he said. "It's entirely optional."
At a cost of $10 a month, the insurance aims to protects homeowners against costly repairs from a waterline break. But contractors told CBC News the chance of this happening is low.
"I wouldn't buy it for my house," said Jason Lavender, owner of Strathcona Excavating.
Lavender said water lines to very old houses occasionally do break, but the chances of it happening to a home built in the last 35 years are small. The cost of fixing a break runs between $2,000 to $5,000.
"Maybe it's trying to put a scare into people that if it does happen, it'll be a big bill," he said. "People don't understand."HomeServe is also contacting EPCOR customers offering to sell them insurance coverage for electrical wiring faults and repairs inside their home.
Le Riche says the insurance may not be right for everyone, but some may find it beneficial.
HomeServe recently entered into a marketing agreement with EPCOR, which is the first Canadian utility the company has worked with. Le Riche will not say how much HomeServe paid EPCOR to enter into the agreement.