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Home warranties are similar to homeowner insurance in that they cover appliances and systems rather than just the structure of your house, yet their differences must be carefully considered before making your decision on a policy’s suitability for your circumstances.
Home warranty companies typically offer both appliance- and system-specific plans, as well as combination plans that cover multiple items. Furthermore, each home warranty provider varies in how it handles claims and how its network of service providers functions.
Coverage
Home warranties provide similar coverage as homeowners insurance but differ in that they focus more on maintaining the functionality of household systems and appliances than dealing with damages to the physical structure itself.
Also read: Does home warranty cover appliances?
Home warranties typically provide coverage for repairs and replacement costs associated with appliances that break down due to normal wear and tear, including refrigerators, stoves, dishwashers, and washers.
Most providers offer appliance-only plans while others may include coverage for heating/cooling/plumbing systems as well as plumbing.
Home warranty providers assign service technicians when systems or appliances break, who perform an inspection and diagnose the issue before performing repairs on the spot or ordering new parts for major repairs as necessary.
Should it become necessary to replace an item entirely, an installation specialist is sent directly from the home warranty provider’s network of service technicians; unfortunately, not all areas can be served by these providers.
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Exclusions
Home warranties are service policies designed to offset the costs of repairs and replacements to systems like electrical, ductwork, and plumbing, as well as appliances like ovens and dishwashers.
Premiums, exclusions, and caps on benefits vary substantially among providers; it is wise to select one who offers sample contracts that provide easy-to-read details of their coverage in order to find an option best suited to their needs and budget.
Home warranties typically don’t cover cosmetic damage to kitchen appliances such as dents and scratches. Furthermore, they typically don’t guarantee the make or model of replacement appliances if one becomes necessary.
Read carefully each contract of each provider to avoid denied claims or unpleasant surprises in the future.
Home warranties can be particularly useful for first-time home buyers who may lack familiarity with local contractors and those whose systems or appliances fall outside their manufacturer’s warranty period.
Repairs
Home warranty providers with exceptional services provide homeowners with multiple plans and coverage options, from appliance to system protection plans, as well as elective riders that further safeguard appliances and systems.
As soon as you file a claim with a home warranty provider, they will select an available service contractor from their network to repair or replace your system or appliance.
Once approved, this provider may either cover parts and labor or simply replace your item if necessary; typically you must also pay an administration or trade call fee which serves as your home warranty deductible.
To maximize your warranty, it is vital that your appliances are maintained regularly. This includes draining your water heater every year and regularly clearing out the lint trap on your dryer, in addition to checking oven temperatures so as not to over-bake food or clog burners.
Furthermore, regular maintenance should include cleaning refrigerator coils, vacuuming your washer, and rinsing out the drip pan in your dishwasher.
Replacements
Home warranties cover appliance and system replacements as part of their coverage, though you should carefully read your contract to understand its annual coverage limit; this amount will dictate how much your provider pays when diagnosing, repairing, or replacing an item; Most contracts include an exclusions list as well.
Many appliances and systems come with manufacturer’s warranties that extend beyond your home warranty period, and some credit cards offer extended coverage when purchasing items with them.
At the end of the day, you must decide if a home warranty is right for you based on your budget and savings for emergencies.
Some find peace of mind worth paying an annual premium in order to avoid the stress and expense associated with repairs or replacing major appliances when they break down – just make sure that your provider offers flexible service options and has pre-vetted contractors in your area.
