Owning a home is a significant investment, and protecting that investment is crucial. Home warranty offers a layer of protection to homeowners by covering the repair or replacement of essential systems and appliances. When it comes to home warranties, there are so many options out there. But if you want to save money on unexpected repair costs, it’s essential to understand the ins and outs. That way, you can choose the right plan for you. Are you ready to gain peace of mind in safeguarding your home? Let’s dive into the world of home warranty!
Key Points
- Protect from costly repairs and replacements for essential systems and appliances.
- Compare coverage, costs, and fees to find the best plan.
- Homeowner’s insurance provides different types of protection than home warranties. Understanding non-covered items & exclusions is essential before purchase.
Understanding Home Warranties
A home warranty is an annual service contract. It covers repairing and replacing essential household appliances and home system components that may break down over time. These warranties provide coverage for:
- Heating and air conditioning systems
- Electrical systems
- Plumbing systems
- Laundry and kitchen appliances
With varying costs based on the homeowner’s needs, plans can start as low as $46.08 per month* and may differ depending on the service provider.
Having a home warranty offers numerous benefits, including:
- Evading hefty repair or replacement costs of appliances and home systems
- Heightening the house’s sale price by an average of 3%
- Achieving a sense of security
- They guarantee the immediate availability of a service professional to handle any issues that arise, reducing the stress of seeking reliable contractors independently.
Service Contracts and Coverage
Service contracts outline a home warranty’s coverage, including specific systems and appliances such as air conditioning units. Repair or replacement is provided based on the home service plan coverage selected. Service providers like American Home Shield offer various plans for homeowners’ needs. These agreements provide comprehensive information about the range. This includes service fees, any limitations, and any exclusions that may apply.
As the contract outlines, being aware of a home warranty’s coverage limitations is crucial. Elements like exclusions, coverage caps, and the nature of repair or replacement offered could influence the home warranty cost. Choice Home Warranty, a reputable service provider in the industry, reserves the right to provide cash back instead of repair or replacement for any covered system, component, or appliance based on the service expert’s assessment.
Trade Call Fees and Service Requests
Trade call fees are fixed diagnostic prices based on the selected plan a homeowner must pay before a licensed professional is sent to diagnose, repair, or replace a covered item. For example, repairing or replacing an air conditioning unit with American Home Shield incurs a predetermined service fee of $100 or $125.
Owning a home warranty can be beneficial in numerous circumstances, such as:
- fixing a broken dryer for a small trade call fee
- protecting homeowners from the steep costs of singular repairs or replacements
- offering both financial security and peace of mind.
Choosing the Best Home Warranty Company
To find the best home warranty company, it is essential to consider factors such as nationwide networks, trusted contractors, coverage details, and costs. Some of the highest-rated home warranty companies nationwide include AFC Home Club, Liberty Home Guard, and American Home Shield. Homeowners can create a list of the systems they wish to cover and then consult a customer service representative to discuss their requirements and preferences to identify the appropriate plan.
Choice Home Warranty stands out as a respected company due to its superior service, competitive cost, and responsiveness to customer feedback. When selecting a reliable contractor for home warranty work, it is essential to consider factors such as reputation and reliability, licensing and insurance, experience and expertise, cost and pricing, and communication and professionalism.
Nationwide Network and Trusted Contractors
A company that provides services has a vast network of contractors nationwide. The company thoroughly evaluates and selects these contractors to offer services to their customers. To ensure the quality of their service, the company follows a strict selection process that includes background checks, verifying licenses and certifications, and checking contractors’ references. This helps to ensure that customers receive high-quality services from reliable and trustworthy contractors in the network.
Access to a vast network of reliable, pre-screened contractors enhances a company’s credibility, confirming prompt and efficient resolution of potential issues or repairs in a customer’s home. A reliable company should have a nationwide network of trusted contractors to guarantee high-quality service, making it a key aspect to consider when selecting a service provider for your requirements.
Comparing Coverage Details and Costs
Comparing coverage details and costs is essential when choosing the most appropriate plan. A plan can range from $264 to $1,425 per year, depending on the home’s size and features, the extent of coverage desired, the provider, and the service fee for each service instance. Coverage details among companies vary, with each company providing plans that cover various systems and appliances in one’s home. Some companies may offer additional coverage for lawn sprinkler systems, pools, and roofs.
Compared to the cost of individual repairs or replacements for major appliances and home systems, the price of a plan generally leans in favor of the project. By comparing different service providers and plans, homeowners can find the best fit for their needs, considering coverage and cost.
Customizing Your Home Warranty Plan
Customizing a plan allows homeowners to select coverage for essential systems and appliances and additional options for unique needs. A basic plan generally contains air conditioning, electrical and plumbing systems, and significant devices like air conditioning units. Homeowners can add items to their project by buying add-ons or extensions for specific items not covered by the standard procedure, such as a sump pump, well pump, or other appliances or systems they would like to include in their coverage.
Benefits of tailoring coverage include:
- Flexibility to assign scope based on personal needs and preferences
- Ensuring the most essential aspects of the home are protected
- Customization to adapt the warranty to unique features and systems of the home
- Providing comprehensive protection tailored to specific circumstances
- Assurance that the correct level of security is in place for potential repairs and replacements
- Considering the cost
Essential Systems and Appliances
Essential systems and appliances are typically those associated with heating, plumbing, electrical, and major appliances, including air conditioning units. Home warranties generally include air conditioning, electrical, plumbing, heating, and cooling systems coverage. Appliance coverage varies by service provider.
Plans usually cover heating, electrical, and plumbing systems. A service professional is available to fix any related issues.
Additional Coverage Options
Depending on the homeowner’s needs, additional coverage options may include swimming pools, septic systems, and electronics. Most companies offer coverage options for systems, appliances, or a combination. Certain companies may also provide additional coverage options, such as roof coverage, as an optional addition. Compare coverage options carefully to find the best fit for your needs.
Additional coverage for swimming pools in home warranties typically functions as an add-on option, with pool coverage offered for an additional fee on top of the monthly premium. The cost of pool coverage may vary from $100 to $205 per year, depending on the provider. Pool coverage generally contains protection for various pool types. It assists in covering the costs of maintaining and repairing the pool but may not cover every aspect related to swimming pools.
Plans may be tailored to include electronics by selecting optional coverages, which enables customization of the home warranty to include desired electronics.
Navigating the Home Warranty Process
The process includes buying a plan, claiming, and seeking qualified professionals’ services. A home warranty can be obtained for new homeowners during a real estate transaction or within 30 days of closing. To purchase a home warranty, it is necessary to assess your coverage requirements, investigate companies, obtain quotes from multiple companies, analyze sample contracts to understand the terms and conditions, weigh your budget, select the right plan, and thoroughly read the final agreement before purchasing.
When filing a claim with a home warranty company, the process generally entails:
- Examining your warranty agreement
- Communicating with your home warranty provider to report the claim
- Furnishing information concerning the issue
- Paying any applicable service fees
- Having a local repair specialist evaluate and carry out the essential repairs
Purchasing a Home Warranty
The purchase process for existing and new homeowners is generally identical. It is possible to purchase a home warranty anytime during home-buying or after closing. Most policies necessitate a 30-day waiting period between when the policy is signed and paid for and when it becomes active. While buying a home warranty, it’s essential to gather maintenance records of all home systems and appliances and examine the plan document’s coverage limits, exclusions, and other terms and conditions.
Investigating highly-rated home warranty providers and comparing quotes before buying is essential to ensure that the optimal coverage for one’s needs is secured at a reasonable price. It is possible to maintain the existing range with the same provider, transfer to another provider, or stop it altogether.
Filing a Claim and Requesting Service
To file a claim, the procedure typically involves reviewing your warranty agreement, communicating with your provider to report the claim, providing information concerning the issue, paying any applicable service fees, and having a local repair specialist evaluate and carry out the essential repairs. The information required to submit a report typically includes the exact difficulty or issue, applicable records, date and time of the problem, contact details, and any other requested details.
A home warranty company may take 4 to 48 hours to respond to a service request. However, there have been instances where a response took up to two weeks. After a service request is filed, the company will:
- Review the request
- Initiate the warranty claims process
- Contact the homeowner to procure additional information regarding the issue
- Schedule a service appointment with a skilled contractor.
Many companies can file a claim through their website.
Evaluating the Value of a Home Warranty
A home warranty covers repairs or replacements for systems and appliances, saving you money and providing peace of mind. It’s a cost-effective solution for major repairs or replacements, especially for elderly or first-time homebuyers.
The savings calculator on American Home Shield’s website assists homeowners in assessing the potential savings of a plan by responding to a few questions about their home. The estimated range of repair costs for typical household appliances and systems is from $107 to $249, with an average cost of approximately $178. Comparing the price of a home warranty plan to the cost of individual repairs or replacements for major appliances and home systems generally leans in favor of the project.
Saving Money with a Home Warranty
Home warranties can save homeowners money by providing the following:
- Protection from unexpected repair costs
- Budget protection
- Reduction of service call fees
- Coverage for multiple systems and appliances
- Cash settlements
The cost may vary from $500 to $1,200 per year, depending on the company, plan, service fee, and add-ons. The service call fee for repairs or replacements covered by the warranty is generally between $60 and $100.
A home warranty plan is generally more cost-effective than individual repairs or replacements for major appliances and home systems. By comparing different service providers and plans, homeowners can find the best fit for their needs, considering coverage and cost.
Peace of Mind for Homeowners
Home warranties offer peace of mind by protecting unexpected repair costs and access to qualified professionals. A home warranty covers repairing or replacing systems and appliances due to wear and tear. It provides financial security by covering some or all of the costs.
Having a home warranty can provide homeowners with the following benefits:
- Saving time and effort in finding reliable contractors for repairs
- Coverage for expected repair or replacement costs for major systems and appliances, such as HVAC, plumbing, electrical, and more
- Peace of mind and financial protection
Common Home Warranty Myths Debunked
Debunking common myths is significant for a better understanding their value and purpose. One common misunderstanding is that home warranties are equivalent to home insurance when not similar to homeowner’s insurance. Home warranties cover repairs and replacements for major appliances and systems due to wear and tear. Homeowners insurance protects against damage from specific events like fires, theft, and natural disasters.
Another misconception is about the standard exclusions in a home warranty. Home warranties come with actual terms and conditions that define coverage and exclusions. Some standard exclusions include:
- Omissions in coverage
- Denial of claims due to lack of maintenance
- Incorrect installation
- Unauthorized repairs
It is critical to review the terms and conditions of a home warranty plan to understand its limitations.
Home Warranties vs. Homeowners Insurance
Home warranties cover repairs or replacements of specific components that fail due to normal wear and use. On the other hand, homeowners insurance covers losses and damages to an individual’s residence resulting from particular perils, such as fire, theft, or natural disasters.
While both home warranties and homeowners insurance protect homeowners, they cover different aspects of home ownership. Home warranties focus on repairing or replacing major home systems and appliances, while homeowners insurance covers accidental damage to one’s home and belongings and liability protection.
It is possible to possess both a home warranty and homeowners insurance concurrently, offering comprehensive protection for one’s home.
Non-Covered Items and Exclusions
Non-covered items and exclusions in plans may vary by provider. Windows, doors, bathtubs and showers, gutters, and smart home systems are generally not included in a home warranty. Home warranty contracts exclude pre-existing conditions, lack of maintenance, natural disasters, sure roofs, and known appliance malfunctions.
Before purchasing, it’s essential to understand non-covered items and exclusions in a plan. Homeowners cannot extend coverage for excluded items in a home warranty plan. Reviewing the warranty contract is critical to ensure the desired protection for repairs and replacements.
Final Thoughts on Finding the Right Home Warranty
Choose the best home warranty company to protect your home investment, customize your plan, and understand home warranties. Home warranties offer significant benefits, such as saving money on repair costs and providing peace of mind to homeowners. To understand the value of home warranties and homeowners insurance, debunk common myths and learn their differences. Evaluate the benefits of a home warranty and navigate the process to safeguard your home long-term.
Frequently Asked Questions
Home warranties can be costly in the long run and often don’t cover all components or items that are not correctly maintained. Additionally, you may not be allowed to pick your preferred service technician.
A home warranty is a service contract that covers the cost of maintaining household systems and appliances for a set period. It pays for repairs or replacements for significant components such as HVAC or electrical systems and specific home appliances like water heaters, garbage disposals, washers, and dryers.
Home warranties protect the repair or replacement of major home systems and appliances due to normal wear and tear. At the same time, homeowners insurance offers coverage for accidental damage to the home and personal property and liability protection.
